<PAGE> 1
SEMIANNUAL REPORT JANUARY 31, 1998
OPPENHEIMER
CASH
RESERVES
[PHOTO]
[OPPENHEIMERFUNDS LOGO]
THE RIGHT WAY TO INVEST
<PAGE> 2
CONTENTS
3 President's Letter
4 An Interview
with the Fund's
Manager
6 Statement of
Investments
9 Statement of
Assets and
Liabilities
10 Statement of
Operations
11 Statements of
Changes in
Net Assets
12 Financial Highlights
15 Notes to Financial
Statements
18 Officers and
Trustees
20 Information and
Services
REPORT HIGHLIGHTS
- -------------------------------------------------------------------------------
- - THE U.S. ECONOMY IS THE ENVY OF THE WORLD. Inflation is virtually
nonexistent, long-term interest rates have fallen below six percent, the
federal budget is nearly balanced, unemployment is under five percent, and
economic growth remains strong. --Dottie Warmack, Fund Manager
CURRENT YIELD
For the 7-day Period Ended 1/31/98
CLASS A
With Without
Compounding(1) Compounding
4.70% 4.59%
CLASS B
With Without
Compounding(1) Compounding
4.07% 3.99%
CLASS C
With Without
Compounding(1) Compounding
4.07% 3.99%
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.
1. Compounded yields assume reinvestment of dividends.
2 Oppenheimer Cash Reserves
<PAGE> 3
[[PHOTO]
JAMES C.SWAIN
Chairman
Oppenheimer
Cash Reserves
[[PHOTO]
BRIDGET A. MACASKILL
President
Oppenheimer
Cash Reserves
DEAR SHAREHOLDER,
- -------------------------------------------------------------------------------
These have been very positive times for many American investors. The U.S.
economy has continued to grow at a moderate pace, unemployment has fallen to
its lowest level in 30 years and inflation has also fallen to a record low. In
fact, long-term interest rates have fallen to their lowest level since the
government began issuing 30-year Treasury bonds in 1977.
What benefits does this provide to the average American? First, when
unemployment levels are low, many individuals tend to feel a greater sense of
job security and can command higher wages because there are fewer unemployed
workers vying for their jobs. Second, many homeowners are opting to refinance
their existing home mortgage loans and take advantage of lower financing rates.
And third, because wages are increasing faster than the rate of inflation, a
paycheck may stretch further and investors, as consumers, are able to enjoy a
higher level of disposable income. This extra income can be put to use in many
ways, including allocating more money to investment opportunities.
Some industry analysts have tempered such positive news by suggesting that
if the rate of inflation falls any lower, it might actually trigger a period of
deflation, where we see the prices of American goods and services decline.
While lower prices may sound like positive news, in reality it isn't: When
prices fall too low, it erodes the value of those goods to the producer. That
is, when economic conditions force a decrease in the price of goods, companies
have to sell more of those items in order to make the same amount of profit,
which translates into greater difficulties for corporations to improve their
bottom lines.
At OppenheimerFunds, we do not believe we will see a period of deflation in
the United States. The fundamental factors that have driven the U.S. market
still appear to be in place: an economy that's in its eighth year of expansion
with moderate growth, low unemployment, virtually no inflation and low interest
rates. However, because of economic uncertainties in other parts of the world,
particularly Asia, we expect to see slower growth for stocks in 1998 and a year
in which double-digit returns from the equity markets are unlikely. It's also
possible that we may see investors favor the fixed, more secure interest
payments offered from the bond markets.
In closing, we'd like to reassure you that as professional money managers,
we continue to keep a watchful eye on these situations and are closely
monitoring your fund's investments. In times like these, your financial advisor
can be of invaluable assistance to you in helping review your financial plan
and guide your investments accordingly.
Thank you for your confidence in OppenheimerFunds, The Right Way to Invest.
We look forward to helping you reach your investment goals in the future.
/s/ JAMES C. SWAIN /s/ BRIDGET A. MACASKILL
James C. Swain Bridget A. Macaskill
February 23, 1998
3 Oppenheimer Cash Reserves
<PAGE> 4
"WE DON'T USE PREDICTIONS OF FUTURE INTEREST RATES TO SET OUR INVESTMENT
STRATEGY."
AN INTERVIEW WITH YOUR FUND'S MANAGER
- -------------------------------------------------------------------------------
HOW HAS THE FUND PERFORMED OVER THE PAST SIX MONTHS?
Oppenheimer Cash Reserves has maintained a stable share price of $1.00 per
share, while continuing to provide a steady stream of monthly income. In
general, U.S. money market instruments continued to offer investors
characteristically high levels of security and liquidity, providing a safe
haven in the face of world stock market volatility during the past few months.
For the 7-day period ending January 31, 1998, the Fund's compounded
current yield for Class A shares was 4.70%. Without compounding, the
corresponding yield for Class A shares was 4.59%. For the Fund's Class B and C
shares, the compounded current yields were 4.07% and 4.07%, and without
compounding 3.99% and 3.99%, respectively.(1)
WHAT FACTORS HAVE AFFECTED THE FUND'S PERFORMANCE?
The Fund's performance is being driven by economic conditions and interest rate
changes in the United States and around the world. Money market yields are
generally linked to interest rates on relatively short-term corporate debt. As
these short-term interest rates rise, money market investors enjoy higher rates
of return. Although long-term and short-term interest rates typically move in
the same direction, recent global economic factors have driven short-term rates
higher while long-term rates have fallen.
The main reason is that Japanese companies, the world's second largest
issuer of short-term debt, continue to experience financial difficulties.
Because investors perceive a lowered credit quality there, issuers have been
required to pay higher interest rates to compensate for the additional risk. To
compete, American issuers in both the government and corporate sectors have
raised rates on short-term instruments. As a result, despite a drop in
long-term rates arising from increased global demand for U.S. Treasury bonds,
4 Oppenheimer Cash Reserves
<PAGE> 5
U.S. money market yields have actually been rising recently, generating
slightly higher rates of return.
HOW HAVE YOU POSITIONED THE FUND TO DEAL WITH ECONOMIC CONDITIONS AND TRENDS?
We don't use predictions of future interest rates to set our investment
strategy. Instead, we "ladder" the portfolio, with some securities maturing in
a few days, some maturing in a month, some maturing in two months and so on.
With a relatively broad maturity spectrum, the portfolio is widely diversified
and able to take advantage of a variety of market conditions. This
diversification is intended to enable the Fund to provide a combination of
liquidity and safety of principal during times of volatility in other markets.
WHAT IS YOUR OUTLOOK FOR THE FUTURE?
All things considered, the U.S. economy is the envy of the world. Inflation is
virtually nonexistent, long-term interest rates have fallen below six percent,
the federal budget is nearly balanced, unemployment is under five percent, and
economic growth continues strong. Even the devaluation of Asia's currencies and
the uncertain business environment in that region may have the beneficial
effect of preventing our economy from overheating. Today's U.S. blue chip
corporations offer a wide selection of commercial paper and short-term notes
that are currently paying attractive yields. At the same time, with the current
backdrop of heightened credit concerns, our strategy remains constant: to
invest in securities that do not present significant credit risk. We believe
our disciplined approach can help continue to reward investors with a
competitive income stream and safety of principal... and continue to make
Oppenheimer Cash Reserves part of The Right Way to Invest.
1. Compounded yields assume reinvestment of dividends.
5 Oppenheimer Cash Reserves
<PAGE> 6
STATEMENT OF INVESTMENTS January 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
FACE VALUE
AMOUNT SEE NOTE 1
====================================================================================================================
<S> <C> <C>
CERTIFICATES OF DEPOSIT --1.1%
- --------------------------------------------------------------------------------------------------------------------
Deutsche Bank AG, 5.65%, 1/22/99 $3,000,000 $ 3,000,000
====================================================================================================================
DIRECT BANK OBLIGATIONS--5.1%
- --------------------------------------------------------------------------------------------------------------------
Bankers Trust Co., New York, 5.71%, 4/15/98(1) 7,000,000 7,000,000
- --------------------------------------------------------------------------------------------------------------------
National Westminster Bank of Canada, 5.59%, 4/30/98 7,000,000 6,904,383
------------
Total Direct Bank Obligations 13,904,383
====================================================================================================================
LETTERS OF CREDIT--10.9%
- --------------------------------------------------------------------------------------------------------------------
Bank of America, guaranteeing commercial paper of
Formosa Plastics Corp., USA, Series B, 5.55%, 3/19/98 5,000,000 4,964,542
- --------------------------------------------------------------------------------------------------------------------
Barclays Bank plc, guaranteeing commercial paper of
Banco de Credito Nacional SA, Series A, 5.58%, 2/3/98 5,000,000 4,998,450
- --------------------------------------------------------------------------------------------------------------------
Bayerische Vereinsbank AG, guaranteeing commercial
paper of Galicia Funding Corp., Series A, 5.77%, 2/27/98(2) 5,000,000 4,979,164
- --------------------------------------------------------------------------------------------------------------------
Credit Suisse, guaranteeing commercial paper of:
Minmetals Capitals & Securities, Inc., 5.57%, 2/11/98 3,000,000 2,995,358
Minmetals Capitals & Securities, Inc., 5.57%, 3/4/98 5,000,000 4,976,018
- --------------------------------------------------------------------------------------------------------------------
Societe Generale, guaranteeing commercial paper of:
Nacional Financiera SNC, Series A, 5.54%, 2/18/98 2,000,000 1,994,749
Nacional Financiera SNC, Series B, 5.535%, 2/17/98 5,000,000 4,987,700
------------
Total Letters of Credit 29,895,981
====================================================================================================================
SHORT-TERM NOTES--76.9%
- --------------------------------------------------------------------------------------------------------------------
AUTOMOTIVE--2.9%
BMW US Capital Corp.:
5.41%, 4/24/98 3,000,000 2,963,032
5.54%, 2/17/98 5,000,000 4,987,689
------------
7,950,721
- --------------------------------------------------------------------------------------------------------------------
BANK HOLDING COMPANIES--1.3%
NationsBank Corp., 6.056%, 5/26/98(1) 3,500,000 3,503,519
- --------------------------------------------------------------------------------------------------------------------
BEVERAGES--2.9%
Coca-Cola Enterprises, Inc.:
5.58%, 4/14/98(2) 3,000,000 2,966,520
5.71%, 4/8/98(2) 5,000,000 4,947,658
------------
7,914,178
- --------------------------------------------------------------------------------------------------------------------
BROKER/DEALERS--18.8%
Bear Stearns Cos., Inc.:
5.691%, 2/9/98(1) 5,000,000 5,000,226
5.75%, 4/1/98(1) 5,000,000 5,000,000
5.809%, 2/20/98(1) 4,000,000 4,000,409
- --------------------------------------------------------------------------------------------------------------------
Lehman Brothers Holdings, Inc., 5.73%, 5/22/98 6,000,000 5,894,950
- --------------------------------------------------------------------------------------------------------------------
Merrill Lynch & Co., Inc.:
5.639%, 1/8/99(1) 3,000,000 3,000,000
5.70%, 4/16/98 5,000,000 4,941,417
</TABLE>
6 Oppenheimer Cash Reserves
<PAGE> 7
<TABLE>
<CAPTION>
FACE VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Morgan Stanley, Dean Witter, Discover & Co., 6.75%, 3/24/98(1) $3,235,000 $ 3,235,000
- --------------------------------------------------------------------------------------------------------------------
Republic New York Securities Corp., 7%, 4/24/98(1) 8,000,000 8,000,000
- --------------------------------------------------------------------------------------------------------------------
Salomon Smith Barney, Inc.:
5.75%, 3/31/98 4,200,000 4,198,735
5.77%, 3/30/98 3,000,000 2,972,592
5.884%, 10/20/98(1) 5,000,000 5,000,000
------------
51,243,329
- --------------------------------------------------------------------------------------------------------------------
COMMERCIAL FINANCE--5.8%
FINOVA Capital Corp.:
5.57%, 3/20/98 5,000,000 4,963,183
5.61%, 4/29/98 3,000,000 2,959,327
- --------------------------------------------------------------------------------------------------------------------
Heller Financial, Inc.:
5.62%, 6/19/98 3,000,000 2,935,370
6%, 4/2/98 5,000,000 4,950,000
------------
15,807,880
- --------------------------------------------------------------------------------------------------------------------
COMPUTER SOFTWARE/SERVICES--1.1%
First Data Corp., 5.67%, 5/19/98 3,000,000 2,949,442
- --------------------------------------------------------------------------------------------------------------------
CONSUMER FINANCE--2.9%
Island Finance Puerto Rico, Inc.:
5.68%, 3/31/98 3,000,000 2,972,547
5.71%, 2/17/98 5,000,000 4,987,311
------------
7,959,858
- --------------------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL--4.6%
Associates Corp. of North America, 7.25%, 5/15/98 2,500,000 2,510,064
- --------------------------------------------------------------------------------------------------------------------
General Electric Capital Services, 5.55%, 3/2/98 5,000,000 4,977,646
- --------------------------------------------------------------------------------------------------------------------
General Motors Acceptance Corp., 5.75%, 4/21/98(1) 5,000,000 4,999,445
------------
12,487,155
- --------------------------------------------------------------------------------------------------------------------
ELECTRONICS--1.8%
Avnet, Inc., 5.42%, 4/17/98 5,000,000 4,943,542
- --------------------------------------------------------------------------------------------------------------------
INDUSTRIAL SERVICES--2.9%
Atlas Copco AB, 5.56%, 3/20/98(2) 8,000,000 7,942,477
- --------------------------------------------------------------------------------------------------------------------
INSURANCE--2.7%
Pacific Mutual Life Insurance Co., 5.976%, 2/2/98(1)(3) 5,000,000 5,000,000
- --------------------------------------------------------------------------------------------------------------------
Safeco Insurance Co., 5.47%, 4/13/98 2,500,000 2,473,030
------------
7,473,030
- --------------------------------------------------------------------------------------------------------------------
LEASING & FACTORING--1.8%
American Honda Finance Corp., 5.625%, 1/19/99(1) 5,000,000 5,000,000
- --------------------------------------------------------------------------------------------------------------------
METALS/MINING--1.8%
Rio Tinto America, Inc., 5.55%, 2/27/98(2) 5,000,000 4,979,958
- --------------------------------------------------------------------------------------------------------------------
OIL-INTEGRATED--2.2%
Fina Oil & Chemical Co., 5.59%, 2/26/98(2) 6,000,000 5,976,708
</TABLE>
7 Oppenheimer Cash Reserves
<PAGE> 8
STATEMENT OF INVESTMENTS (Unaudited)(Continued)
<TABLE>
<CAPTION>
FACE VALUE
AMOUNT SEE NOTE 1
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
SPECIAL PURPOSE FINANCIAL--23.4%
Asset Backed Capital Finance, Inc.:
5.60%, 2/9/98(2) $3,500,000 $ 3,495,644
5.73%, 11/23/98(1)(3) 4,000,000 4,000,000
- --------------------------------------------------------------------------------------------------------------------
Beta Finance, Inc.:
5.54%, 2/17/98(2) 5,600,000 5,586,212
5.56%, 3/16/98(2) 5,000,000 4,966,794
5.57%, 4/29/98(2) 3,000,000 2,959,617
- --------------------------------------------------------------------------------------------------------------------
Cooperative Assn. of Tractor Dealers:
Series A, 5.40%, 7/17/98 5,000,000 4,875,500
Series A, 5.95%, 2/17/98 3,000,000 2,992,067
Series B, 5.47%, 4/16/98 5,000,000 4,943,781
Series B, 5.57%, 3/10/98 3,802,000 3,780,235
- --------------------------------------------------------------------------------------------------------------------
Corporate Asset Funding Co., Inc., 5.65%, 2/2/98(2) 2,500,000 2,499,608
- --------------------------------------------------------------------------------------------------------------------
CXC, Inc., 5.65%, 4/6/98(2) 5,000,000 4,949,778
- --------------------------------------------------------------------------------------------------------------------
Enterprise Funding Corp.:
5.38%, 7/27/98(2) 4,190,000 4,079,794
5.67%, 4/8/98(2) 4,994,000 4,942,087
- --------------------------------------------------------------------------------------------------------------------
Preferred Receivables Funding Corp.:
5.55%, 2/17/98(2) 4,000,000 3,990,133
5.55%, 2/17/98(2) 5,900,000 5,885,447
------------
63,946,697
------------
Total Short-Term Notes 210,078,494
====================================================================================================================
FOREIGN GOVERNMENT OBLIGATIONS--1.8%
- --------------------------------------------------------------------------------------------------------------------
Finnish Export Credit Ltd., 5.55%, 7/15/98 5,000,000 4,873,583
- --------------------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE 95.8% 261,752,441
- --------------------------------------------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 4.2 11,615,704
------------ ------------
NET ASSETS 100.0% $273,368,145
============ ============
</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 January 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. Security issued in exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $75,147,599, or 27.49% of the
Fund's net assets, and have been determined to be liquid pursuant to guidelines
adopted by the Board of Trustees.
3. 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 $9,000,000, or 3.29% 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.
See accompanying Notes to Financial Statements.
8 Oppenheimer Cash Reserves
<PAGE> 9
STATEMENT OF ASSETS AND LIABILITIES January 31, 1998 (Unaudited)
<TABLE>
<CAPTION>
==============================================================================
ASSETS
<S> <C>
Investments, at value $261,752,441
- ------------------------------------------------------------------------------
Cash 463,643
- ------------------------------------------------------------------------------
Receivables:
Shares of beneficial interest sold 13,401,407
Interest 363,545
- ------------------------------------------------------------------------------
Other 71,931
------------
Total assets 276,052,967
==============================================================================
LIABILITIES
Payables and other liabilities:
Shares of beneficial interest redeemed 2,075,550
Dividends 372,481
Transfer and shareholder servicing agent fees 112,150
Distribution and service plan fees 31,902
Other 92,739
------------
Total liabilities 2,684,822
==============================================================================
NET ASSETS $273,368,145
============
==============================================================================
COMPOSITION OF NET ASSETS
Paid-in capital $273,373,339
- ------------------------------------------------------------------------------
Accumulated net realized loss on investment transactions (5,194)
------------
Net assets $273,368,145
============
==============================================================================
NET ASSET VALUE PER SHARE
Class A Shares:
Net asset value, redemption price and offering price
per share (based on net assets of $190,494,758 and
190,556,052 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 $69,295,350 and 69,294,415
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 $13,578,037 and 13,577,542 shares
of beneficial interest outstanding) $1.00
</TABLE>
See accompanying Notes to Financial Statements.
9 Oppenheimer Cash Reserves
<PAGE> 10
STATEMENT OF OPERATIONS For the Six Months Ended January 31, 1998 (Unaudited)
<TABLE>
<S> <C>
==============================================================================
INVESTMENT INCOME
Interest $7,818,863
==============================================================================
EXPENSES
Management fees--Note 3 671,258
- ------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees--Note 3 635,309
- ------------------------------------------------------------------------------
Distribution and service plan fees--Note 3:
Class A 182,182
Class B 263,105
Class C 53,768
- ------------------------------------------------------------------------------
Shareholder reports 110,504
- ------------------------------------------------------------------------------
Registration and filing fees 81,109
- ------------------------------------------------------------------------------
Custodian fees and expenses 20,715
- ------------------------------------------------------------------------------
Legal and auditing fees 5,762
- ------------------------------------------------------------------------------
Insurance expenses 2,486
- ------------------------------------------------------------------------------
Other 6,146
----------
Total expenses 2,032,344
==============================================================================
NET INVESTMENT INCOME 5,786,519
==============================================================================
NET REALIZED GAIN ON INVESTMENTS 323
==============================================================================
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $5,786,842
==========
</TABLE>
See accompanying Notes to Financial Statements.
10 Oppenheimer Cash Reserves
<PAGE> 11
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SIX MONTHS ENDED
JANUARY 31, 1998 YEAR ENDED
(UNAUDITED) JULY 31, 1997
===============================================================================================
<S> <C> <C>
OPERATIONS
Net investment income $ 5,786,519 $ 10,745,370
- -----------------------------------------------------------------------------------------------
Net realized gain 323 2,265
- -----------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations 5,786,842 10,747,635
===============================================================================================
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Class A (4,130,018) (7,785,359)
Class B (1,374,843) (2,546,870)
Class C (281,658) (413,141)
===============================================================================================
BENEFICIAL INTEREST TRANSACTIONS
Net increase (decrease) in net assets resulting from
beneficial interest transactions--Note 2:
Class A 17,524,703 2,937,563
Class B 15,286,319 (31,565,083)
Class C 4,453,446 (2,592,039)
===============================================================================================
NET ASSETS
Total increase (decrease) 37,264,791 (31,217,294)
- -----------------------------------------------------------------------------------------------
Beginning of period 236,103,354 267,320,648
------------ ------------
End of period $273,368,145 $236,103,354
============ ============
</TABLE>
See accompanying Notes to Financial Statements.
11 Oppenheimer Cash Reserves
<PAGE> 12
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
CLASS A
------------------------------------------------------------------
SIX MONTHS
ENDED
JANUARY 31,
1998 YEAR ENDED JULY 31, YEAR ENDED DECEMBER 31,
(UNAUDITED) 1997 1996(2) 1995 1994
========================================================================================================
<S> <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
- --------------------------------------------------------------------------------------------------------
Income from investment
operations--net investment
income and net realized gain .02 .04 .03 .05 .03
Dividends and distributions to
shareholders (.02) (.04) (.03) (.05) (.03)
- --------------------------------------------------------------------------------------------------------
Net asset value, end of period $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== =====
========================================================================================================
TOTAL RETURN(5) 2.29% 4.41% 2.68% 4.84% 3.22%
========================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in thousands) $190,495 $172,970 $170,031 $148,529 $99,361
- --------------------------------------------------------------------------------------------------------
Average net assets
(in thousands) $183,450 $179,948 $149,889 $105,349 $87,908
- --------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 4.47%(6) 4.33% 4.47%(6) 4.71% 3.25%
Expenses 1.33%(6) 1.29% 1.06%(6) 1.36% 1.32%
</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.
4. Less than $.005 per share.
12 Oppenheimer Cash Reserves
<PAGE> 13
<TABLE>
<CAPTION>
CLASS B
- ------------------ --------------------------------------------------------------------------------
SIX MONTHS
ENDED
JANUARY 31,
1998 YEAR ENDED JULY 31, YEAR ENDED DECEMBER 31,
1993 1992 (UNAUDITED) 1997 1996(2) 1995 1994 1993(3)
==========================================================================================================
<S> <C> <C> <C> <C> <C> <C> <C>
$1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- ----------------------------------------------------------------------------------------------------------
.02 .03 .02 .04 .02 .04 .03 --(4)
(.02) (.03) (.02) (.04) (.02) (.04) (.03) --(4)
- ----------------------------------------------------------------------------------------------------------
$1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
===== ===== ===== ===== ===== ===== ===== ======
==========================================================================================================
2.05% 3.07% 1.99% 3.82% 2.35% 4.26% 2.54% 0.56%
==========================================================================================================
$70,924 $ 89,266 $69,295 $54,009 $85,573 $37,378 $46,803 $628
- ----------------------------------------------------------------------------------------------------------
$76,910 $104,970 $69,655 $67,333 $49,226 $35,360 $21,262 $454
- ----------------------------------------------------------------------------------------------------------
1.99% 3.07% 3.92%(6) 3.78% 3.91%(6) 4.15% 3.05% 1.49%(6)
1.55% 1.25%(7) 1.89%(6) 1.84% 1.61%(6) 1.92% 1.89% 2.12%(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.
6. Annualized.
7. The expense ratio was 1.42% absent the voluntary reimbursement by the
Manager.
13 Oppenheimer Cash Reserves
<PAGE> 14
FINANCIAL HIGHLIGHTS (Continued)
<TABLE>
<CAPTION>
CLASS C
--------------------------------------------------------------------------------
SIX MONTHS
ENDED
JANUARY 31,
1998 YEAR ENDED JULY 31, YEAR ENDED DECEMBER 31,
(UNAUDITED) 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 .02 .04 .02 .04 .02 --(4)
Dividends and distributions to
shareholders (.02) (.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) 2.00% 3.84% 2.35% 4.21% 2.51% 0.14%
======================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(in thousands) $13,578 $ 9,125 $11,717 $5,024 $5,604 $1
- ----------------------------------------------------------------------------------------------------------------------
Average net assets
(in thousands) $14,268 $10,930 $ 6,333 $6,040 $2,107 $1
- ----------------------------------------------------------------------------------------------------------------------
Ratios to average net assets:
Net investment income 3.92%(6) 3.78% 3.91%(6) 4.12% 3.19% 1.18%(6)
Expenses 1.88%(6) 1.85% 1.61%(6) 1.97% 1.90% 2.35%(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.
4. Less than $.005 per share.
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.
6. Annualized.
7. The expense ratio was 1.42% absent the voluntary reimbursement by the
Manager.
See accompanying Notes to Financial Statements.
14 Oppenheimer Cash Reserves
<PAGE> 15
NOTES TO FINANCIAL STATEMENTS (Unaudited)
===============================================================================
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, 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.
15 Oppenheimer Cash Reserves
<PAGE> 16
NOTES TO FINANCIAL STATEMENTS (Unaudited)(Continued)
===============================================================================
1. SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
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 of each class. Transactions in shares of beneficial
interest were as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED JANUARY 31, 1998 YEAR ENDED JULY 31, 1997
--------------------------------- -----------------------------
SHARES AMOUNT SHARES AMOUNT
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A:
Sold 352,379,207 $ 352,379,207 539,202,800 $ 539,202,800
Dividends and
distributions reinvested 3,785,879 3,785,879 7,258,877 7,258,877
Redeemed (338,640,383) (338,640,383) (543,524,114) (543,524,114)
------------ ------------- ------------ -------------
Net increase 17,524,703 $ 17,524,703 2,937,563 $ 2,937,563
============ ============= ============ =============
- -----------------------------------------------------------------------------------------------
Class B:
Sold 160,763,474 $ 160,763,474 228,968,814 $ 228,968,814
Dividends and
distributions reinvested 1,121,394 1,121,394 2,072,482 2,072,482
Redeemed (146,598,549) (146,598,549) (262,606,379) (262,606,379)
------------ ------------- ------------ --------------
Net increase (decrease) 15,286,319 $ 15,286,319 (31,565,083) $ (31,565,083)
============ ============= ============ =============
- -----------------------------------------------------------------------------------------------
Class C:
Sold 89,413,992 $ 89,413,992 72,171,736 $ 72,171,736
Dividends and
distributions reinvested 220,449 220,449 343,761 343,761
Redeemed (85,180,995) (85,180,995) (75,107,536) (75,107,536)
------------ ------------- ------------ -------------
Net increase (decrease) 4,453,446 $ 4,453,446 (2,592,039) $ (2,592,039)
============ ============= ============ =============
</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 0.50% of the first
$250 million of 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 net assets in excess
of $1 billion.
16 Oppenheimer Cash Reserves
<PAGE> 17
===============================================================================
Sales charges advanced to broker/dealers by OFDI on sales of the Fund's Class B
and Class C shares totaled $223,858 and $5,272, respectively, of which $13,951
was paid to an affiliated broker/dealer for Class B.
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 six months
ended January 31, 1998, OFDI paid $45,242 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 services and costs in distributing
Class B and Class C shares and servicing accounts. Under the Plans, the Fund
pays OFDI an annual asset-based sales charge of 0.75% per year on Class B and
Class C shares, as compensation for sales commissions paid from its own
resources at the time of sale and associated financing costs. OFDI also
receives a service fee of 0.25% per year as compensation for costs incurred in
connection with the personal service and maintenance of accounts that hold
shares of the Fund, including amounts paid to brokers, dealers, banks and other
financial institutions. At present, these service fees are set at zero for
Class B and Class C shares. Both fees are computed on the average annual net
assets of Class B and Class C shares, determined as of the close of each
regular business day. During the six months ended January 31, 1998, OFDI
retained $263,145 and $53,766, 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.
17 Oppenheimer Cash Reserves
<PAGE> 18
OPPENHEIMER CASH RESERVES
<TABLE>
<S> <C>
=========================================================================================
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
Dorothy G. Warmack, 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.
The financial statements included herein have
been taken from the records of the Fund without
examination of the independent auditors. 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.
</TABLE>
18 Oppenheimer Cash Reserves
<PAGE> 19
OPPENHEIMERFUNDS FAMILY
<TABLE>
<S> <C> <C>
============================================================================================================
REAL ASSET FUNDS
- ------------------------------------------------------------------------------------------------------------
Real Asset Fund Gold & Special Minerals Fund
============================================================================================================
STOCK FUNDS
- ------------------------------------------------------------------------------------------------------------
Developing Markets Fund Discovery Fund Growth Fund
International Small Quest Small Cap Value Fund Global Fund
Company Fund MidCap Fund Quest Global Value Fund
Enterprise Fund Capital Appreciation Fund Disciplined Value Fund
International Growth Fund Quest Capital Value Fund Quest Value Fund
============================================================================================================
STOCK &BOND FUNDS
- ------------------------------------------------------------------------------------------------------------
Main Street Income & Quest Growth & Income Disciplined Allocation Fund
Growth Fund Value Fund Multiple Strategies Fund
Quest Opportunity Value Fund Global Growth & Income Fund Bond Fund for Growth
Total Return Fund Equity Income Fund
============================================================================================================
BOND FUNDS
- ------------------------------------------------------------------------------------------------------------
International Bond Fund Champion Income Fund U.S. Government Trust
High Yield Fund Strategic Income Fund Limited-Term Government Fund
Bond Fund
============================================================================================================
MUNICIPAL FUNDS
- ------------------------------------------------------------------------------------------------------------
California Municipal Fund(1) Pennsylvania Municipal Fund(1) Rochester Division:
Florida Municipal Fund(1) Municipal Bond Fund Rochester Fund Municipals
New Jersey Municipal Fund(1) Insured Municipal Fund Limited Term New York
New York Municipal Fund(1) Intermediate Municipal Fund Municipal Fund
============================================================================================================
MONEY MARKET FUNDS(2)
- ------------------------------------------------------------------------------------------------------------
Money Market Fund Cash Reserves
============================================================================================================
LIFESPAN
- ------------------------------------------------------------------------------------------------------------
Growth Fund Balanced Fund Income Fund
</TABLE>
1. Available only to investors in certain states.
2. An investment in money market funds is neither insured nor guaranteed by the
U.S. government and there can be no assurance that a money market fund will be
able to maintain a stable net asset value of $1.00 per share. 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.
19 Oppenheimer Cash Reserves
<PAGE> 20
INTERNET
24-hr access to account information
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
INFORMATION AND SERVICES
- -------------------------------------------------------------------------------
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. 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, or visit us at our website at
www.oppenheimerfunds.com--we're here to help.
[OPPENHEIMER FUNDS LOGO]
RS0760.001.0198 April 1, 1998
