<PAGE>
OCC ACCUMULATION TRUST
o GLOBAL EQUITY PORTFOLIO
ANNUAL REPORT
1999
MANAGED BY
[LOGO]
OPCAP ADVISORS
<PAGE>
OCC ACCUMULATION TRUST
MANAGED BY
[LOGO]
OPCAP ADVISORS
1999 ANNUAL REPORT
The stock market in 1999 was characterized by two contradictory trends: the
rapid price escalation of many technology stocks, especially those associated
with e-commerce and the Internet, and a widespread malaise among stocks in most
other industry sectors. The Standard & Poor's 500 Index (the "S&P 500") rose
21.0% during the year, returning more than 20% for a record fifth consecutive
year. However, this performance distorted the overall direction of the market.
Without its technology stock component, the S&P 500 would have been down 1% in
1999. In fact, approximately 60% of the stocks on the New York Stock Exchange
declined in price during the year.
The year was especially challenging for value investors such as ourselves.
Quality companies with strong competitive positions, high cash flow and
favorable earnings prospects--the types of companies in which we invest
generally did very well. The stocks of these companies, however, were out of
favor, trailing the market indexes by a wide margin. As a result, our investment
returns generally fell short of our benchmarks in 1999.
We have always been thoughtful in our value style to give consideration to
companies across the breadth of the market, including technology companies. In
fact, we did well with several technology investments during the past year,
including Computer Associates and Motorola in the United States and Ericsson and
Alcatel in Europe. However, in the current ebullient market for technology
stocks, it has become increasingly difficult to find value in the sector.
Regardless of whether the current technology stock craze turns out to be a
bubble that bursts, the technology industry is growing rapidly and creating
enormous economic wealth. Our challenge as value investors, therefore, is to
identify solid companies that stand to benefit from this growth.
At OpCap Advisors, we continue to invest in our people and our operation to
ensure we have the necessary resources to meet this challenge. Our firm has
moved aggressively to hire additional investment personnel and has made
important reallocations of people and resources to best apply investment skills
not only to technology stocks, but to other industry sectors as well. We have
established "sector" groups, involving the integration of our domestic and
international analysts, to ensure timely and complete coverage of investment
opportunities wherever they may exist.
By remaining disciplined in our value style, and taking the necessary actions to
keep pace with an ever-evolving stock market, we are focused on delivering
excellent long-term investment results without taking large risks. We believe
many of the stocks we own are significantly undervalued, providing opportunities
for substantial profits as undervalued securities of financially solid, growing
companies return to favor.
As the new year begins, the U.S. economy remains strong, perhaps too strong, and
there are indications of excessive optimism in the stock market. Inflation has
been kept low for the past several years by an internationally competitive
environment, major improvements in technology, corporate mergers and
restructurings, and low inflation expectations. Recently, however, some of these
factors have reversed. Commodity prices have rebounded strongly, while energy
and import prices are on the rise. These factors suggest to us that inflationary
pressures could increase somewhat in the months ahead and that the Federal
Reserve is likely to raise interest rates further, on top of the four rate
increases implemented since June 1999. We believe these conditions will favor
our value style of investing, which emphasizes companies that can generate a
high level of cash flow throughout the economic cycle.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
The Global Equity Portfolio delivered a total return of 26.5% in 1999, exceeding
the 24.9% return of its benchmark, the Morgan Stanley Capital International
World Index (the "World Index") in U.S. dollars. We are pleased with these
results, which primarily reflected favorable stock selection in Europe and
Japan. The Portfolio's return of 11.6% during the second half of the year
compared with a return of 15.1% for the World Index.
The Portfolio invests in undervalued companies with what we consider to be
superior business characteristics, including strong competitive positions, high
cash flow and positive earnings outlooks. The objective of our value-based
approach is to capitalize on investment opportunities worldwide and deliver
excellent long-term investment results while controlling risk.
For the three years ended December 31, 1999, the Portfolio delivered an average
annual total return of 17.8% compared with 21.6% for the World Index. From its
inception on March 1, 1995 through December 31, 1999, the Portfolio's average
annual return was 18.1% while the annual return on the World Index was 20.5%.
Returns for the Portfolio take into account expenses incurred by the Portfolio,
but not separate account charges imposed by the insurance company.
At December 31, 1999, the Portfolio's top six country positions were: the United
States, representing 36.2% of the Portfolio's net assets; Japan, 11.6% of net
assets; the United Kingdom, 10.9% of net assets; France, 6.3% of net assets;
Sweden, 5.2% of net assets; and Germany, 5.0% of net assets.
During the year, many global stock markets rose sharply, reflecting a high level
of investor optimism about the growth of the Internet, particularly as it may
affect data traffic over fixed and mobile phone lines. This strength was visible
not only in the United States stock market, but also in the European and Asian
markets, where technology issues led stock prices higher. The early success of
mobile Internet services in Japan and a hostile bid for Mannesmann, Germany's
largest mobile operator, propelled many stocks with direct and peripheral
exposure to the convergence of Internet data transfer and telephony. In Europe,
the trend toward consolidation is sweeping across key industries such as
telecommunications, finance, and healthcare, resulting in higher share prices.
European holdings of the Portfolio that benefited from these developments
included Swedish mobile equipment maker Ericsson, which gained 110% during the
fourth quarter alone in the wake of a strong third-quarter earnings report and
growing order books. French fixed line hardware supplier Alcatel increased 66%
during the fourth quarter. The Spanish telephone company, Telefonica, which owns
a large Internet portal and the country's main mobile phone operation, also rose
strongly, as did German conglomerate Siemens. The latter company is in the
process of restructuring its total portfolio of businesses, including a
promising position in telecommunications equipment. EMI Music enjoyed a strong
performance, reflecting investors' enthusiasm for the company's investment in
Internet music sites.
On the other hand, many of our European holdings in traditional businesses were
flat or even lower in price during the year. U.K. remote-retailer Great
Universal Stores fell on fears concerning its catalog business despite the
company's strong presence in consumer credit and in marketing techniques ideally
suited to e-commerce. Other high-quality traditional businesses that languished
included Diageo (global food and spirits company), Great Universal Stores (large
discount retail franchise) and XL Capital (insurance and reinsurance).
We enjoyed an outstanding year in Japan, where our holdings more than doubled in
value by the end of the first quarter of 1999 and kept right on rising. As
prices continued to increase, we began to reduce our Japanese investments
because of concerns about high valuations. While we continue to search for new
Japanese stocks, it is increasingly difficult to identify solid businesses that
trade at discounts to their intrinsic value. We did add cosmetics maker Shiseido
to our Japanese holdings after several meetings with management convinced us
that the company, which had fared poorly in recent years, now has a credible
program for improving profit margins and returns on investment.
In the U.S., the Portfolio's investments consist of a core group of quality
companies that we believe to be undervalued, such as Wells Fargo (banking),
Citigroup (banking and other financial services) and Computer Associates
International (computer software). Our sizable holdings of financial stocks in
the U.S. detracted from performance. Even though the financial companies we own
continue to increase their earnings and create
<PAGE>
shareholder value, share prices of many financial corporations were down in 1999
due to investor concerns regarding the impact of higher interest rates. In the
latter part of the year, we repositioned our financial holdings, taking money
from superlative performers such as Citigroup and using it to purchase stocks
such as Freddie Mac whose share price declined in 1999 despite continued strong
earnings growth.
During the second half of 1999, we established a new position in Anadarko
Petroleum, an oil and gas exploration and production company based in the U.S.
Anadarko is well managed and, in our view, the share price is inexpensive in
relation to the company's business prospects.
Our emerging market investments include small positions in India and Brazil. Our
main investment in Brazil is Telebras, a holding company with controlling stakes
in most of the fixed and wireless telephone companies in that nation which has
provided a solid investment return during the second half of 1999.
In the second half of the year, we began to take a somewhat more defensive
investment posture due to concerns about valuations and the impact of rising
interest rates. At December 31, 1999, the Portfolio's net assets were allocated
57.3% to the common stocks of companies based outside the United States, 36.2%
to the common stocks of companies headquartered within the U.S., and 6.8% to
short-term investments. This reflected a reduction in our U.S. holdings during
the fourth quarter and an increase in short-term investments.
The Portfolio's five largest non-U.S. equity holdings at December 31, 1999 were
XL Capital, a strongly capitalized specialty insurance company headquartered in
Bermuda, representing 2.6% of the Portfolio's net assets; News Corp., an
Australian-based global media and entertainment company, 2.3% of net assets;
Sony, the well-known Japanese electronics and consumer products company, 1.9% of
net assets; Teva Pharmaceutical, an Israeli pharmaceutical company, 1.9% of net
assets; and Skandinaviska Enskilda Banken, a leading Swedish bank, 1.9% of net
assets.
The five largest U.S. equity holdings were Wells Fargo, a financial conglomerate
comprising one of the larger banks in the Midwest and West, together with
national mortgage and consumer finance companies, representing 3.9% of the
Portfolio's net assets; Citigroup, a leading global banking, insurance and other
financial services company, 3.7% of net assets; Freddie Mac, the second largest
insurer of home mortgages in the U.S., 3.6% of net assets; Computer Associates
International, which designs and markets computer software, 3.2% of net assets;
and McDonald's, a premier fast-food company with growing global markets, 2.3% of
net assets.
Major industry positions were: financial services, representing 12.9% of the
Portfolio's net assets at December 31, 1999; banking, 10.5% of net assets;
telecommunications, 8.5% of net assets; technology, 7.4% of net assets; and
consumer products, 6.8% of net assets.
<PAGE>
OCC ACCUMULATION TRUST--GLOBAL EQUITY PORTFOLIO
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT IN
THE PORTFOLIO AND THE MORGAN STANLEY WORLD INDEX+
PERIODS ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
3/1/95* 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
------ -------- -------- -------- ------- --------
Glogal Equity Portfolio 9,970.00 11,872.98 13,654.38 15,568.38 17,637.19 22,315.33
Morgan Stanley World Index+ 10,480.00 12,084.96 13,714.69 15,874.86 19,736.91 24,661.13
</TABLE>
AVERAGE ANNUAL TOTAL RETURN
1 YEAR SINCE MARCH 1, 1995*
26.5% 18.1%
The performance graph does not reflect charges imposed by the Variable Accounts.
Past performance is not predictive of future performance
Assumes reinvestment of all dividends and distributions
+ The Morgan Stanley World Index is an unmanaged index that is not available for
direct investment. It includes reinvested dividends.
* Portfolio's inception.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
SHARES VALUE
- ------------ -------------
<S> <C> <C>
COMMON STOCK -- 93.5%
AUSTRALIA -- 2.3%
MEDIA/BROADCASTING -- 2.3%
30,000 News Corp. Ltd. ADR+................................................................ $1,003,125
-------------
AUSTRIA -- 1.0%
BANKING -- 1.0%
7,700 Bank Austria AG..................................................................... 434,369
-------------
BERMUDA -- 2.6%
INSURANCE -- 2.6%
21,897 XL Capital Ltd...................................................................... 1,135,907
-------------
BRAZIL -- 1.2%
PAPER PRODUCTS -- 0.0%
210,000 Empresa Nacional de Comercio Redito E Participacoes SA+............................. 302
-------------
TELECOMMUNICATIONS -- 1.2%
6,100,000 Telecomunicacoes Brasileiras SA ("Telebras")........................................ 520,011
-------------
CANADA -- 0.8%
TRANSPORTATION -- 0.8%
17,000 Canadian Pacific Ltd................................................................ 365,674
-------------
DENMARK -- 1.1%
FINANCIAL SERVICES -- 1.1%
6,500 Unidanmark A/S...................................................................... 457,443
-------------
FINLAND -- 0.8%
PAPER PRODUCTS -- 0.8%
20,100 Stora Enso Oyj...................................................................... 350,488
-------------
FRANCE -- 6.3%
BANKING -- 1.0%
4,500 Banque Nationale de Paris........................................................... 415,230
-------------
ELECTRONICS -- 1.1%
2,150 Alcatel............................................................................. 493,803
-------------
FINANCIAL SERVICES -- 1.1%
2,000 Societe Generale.................................................................... 465,396
-------------
FOOD & BEVERAGES -- 1.6%
2,850 Groupe Danone....................................................................... 671,801
-------------
INSURANCE -- 0.4%
4,300 Scor SA............................................................................. 189,724
-------------
OFFICE EQUIPMENT -- 1.1%
10,900 Societe BIC SA...................................................................... 496,081
-------------
GERMANY -- 5.0%
BANKING -- 1.4%
9,150 Bayerische HypoVereinsbank AG....................................................... 624,929
-------------
MANUFACTURING -- 1.5%
5,200 Siemens AG.......................................................................... 661,587
-------------
POWER/UTILITY -- 1.4%
12,200 Veba Aktien AG...................................................................... 592,976
-------------
</TABLE>
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
(CONTINUED)
<TABLE>
<CAPTION>
SHARES VALUE
---------- -------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
GERMANY (CONTINUED)
RETAIL -- 0.7%
6,000 Hornbach Holding AG+................................................................ $ 290,117
-------------
GREECE -- 1.0%
TELECOMMUNICATIONS -- 1.0%
35,100 Panafon Hellenic Telecom SA......................................................... 444,015
-------------
HONG KONG -- 0.5%
INDUSTRIAL MATERIALS -- 0.5%
85,000 Yue Yuen Industrial Holdings........................................................ 202,290
-------------
INDIA -- 1.3%
BANKING -- 0.4%
15,000 State Bank of India GDR Reg. S...................................................... 178,500
-------------
TELECOMMUNICATIONS -- 0.9%
34,000 Mahanagar Telephone Nigam Ltd....................................................... 374,000
-------------
ISRAEL -- 1.9%
DRUGS & MEDICAL PRODUCTS -- 1.9%
11,400 Teva Pharmaceutical Industries Ltd. ADR............................................. 817,238
-------------
ITALY -- 1.2%
TELECOMMUNICATIONS -- 1.2%
82,300 Telecom Italia SpA.................................................................. 501,574
-------------
JAPAN -- 11.6%
CONSUMER PRODUCTS -- 5.7%
11,000 CANON, Inc.......................................................................... 437,115
20,000 Kao Corp............................................................................ 570,617
44,000 Shiseido Co......................................................................... 641,675
2,800 SONY Corp........................................................................... 830,381
-------------
2,479,788
-------------
ELECTRONICS -- 1.2%
11,000 Fujitsu Ltd......................................................................... 501,713
-------------
FINANCIAL SERVICES -- 2.4%
9,600 Nichiei Co., Ltd.................................................................... 208,594
47,300 Nikko Securities Co., Ltd........................................................... 598,599
650 Shohkoh Fund........................................................................ 257,341
-------------
1,064,534
-------------
FOOD & BEVERAGES -- 0.8%
19,000 Mikuni Coca-Cola Bottling Co........................................................ 332,877
-------------
HOUSING -- 0.4%
2,900 FamilyMart Co., Ltd................................................................. 193,012
-------------
TECHNOLOGY -- 1.1%
29,900 Canon Sales Co., Inc................................................................ 462,386
-------------
</TABLE>
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
(CONTINUED)
<TABLE>
<CAPTION>
SHARES VALUE
---------- -------------
<S> <C> <C>
COMMON STOCK (CONTINUED)
SPAIN -- 2.6%
BANKING -- 0.9%
6,000 Banco Popular Espanol SA............................................................ $391,355
-------------
ENERGY -- 0.9%
30,000 Iberdrola SA........................................................................ 415,834
-------------
TELECOMMUNICATIONS -- 0.8%
13,260 Telefonica SA*...................................................................... 331,265
-------------
SWEDEN -- 5.2%
BANKING -- 1.9%
72,600 Skandinaviska Enskilda Banken....................................................... 733,764
10,400 Skandinaviska Enskilda Banken (New Series A)*....................................... 103,890
-------------
837,654
-------------
DRUGS & MEDICAL PRODUCTS -- 1.1%
10,200 Pharmacia & UpJohn, Inc............................................................. 462,710
-------------
ELECTRONICS -- 0.9%
16,000 Electrolux AB....................................................................... 402,398
-------------
HOTELS -- 0.4%
18,000 Scandic Hotels AB................................................................... 167,117
-------------
TELECOMMUNICATIONS -- 0.9%
6,000 Telefonaktiebolaget LM Ericsson..................................................... 385,709
-------------
UNITED KINGDOM -- 10.9%
CONSUMER PRODUCTS -- 1.1%
51,200 Reckitt Benckiser plc............................................................... 484,642
-------------
DRUGS & MEDICAL PRODUCTS -- 1.1%
145,000 Smith & Nephew plc.................................................................. 487,175
112 SmithKline Beecham plc.............................................................. 1,420
-------------
488,595
-------------
ELECTRONICS -- 1.0%
80,000 Invensys plc........................................................................ 422,963
-------------
ENERGY -- 0.9%
60,000 Enterprise Oil...................................................................... 407,056
-------------
ENTERTAINMENT -- 1.6%
69,000 EMI Group plc....................................................................... 679,880
-------------
FOOD SERVICES -- 1.2%
63,700 Diageo plc.......................................................................... 508,299
-------------
INDUSTRIAL MATERIALS -- 1.2%
117,000 Williams plc........................................................................ 532,952
-------------
PRINTING/PUBLISHING -- 1.2%
72,700 Reed International plc.............................................................. 546,060
-------------
RETAIL -- 1.6%
116,900 Great Universal Stores plc.......................................................... 679,783
-------------
</TABLE>
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
(CONTINUED)
<TABLE>
<CAPTION>
SHARES VALUE
---------- -------------
<S> <C> <C>
COMMON STOCK (CONCLUDED)
UNITED STATES -- 36.2%
AEROSPACE/DEFENSE -- 2.1%
22,150 Boeing Co........................................................................... $ 920,609
-------------
BANKING -- 3.9%
41,400 Wells Fargo & Co.................................................................... 1,674,113
-------------
CHEMICALS -- 2.1%
14,000 du Pont (E.I.) de Nemours & Co...................................................... 922,250
-------------
CONGLOMERATES -- 1.7%
7,700 Minnesota Mining & Manufacturing Co................................................. 753,638
-------------
DRUGS & MEDICAL PRODUCTS -- 1.0%
10,800 American Home Products Corp......................................................... 425,925
-------------
ENERGY -- 0.1%
1,200 Anadarko Petroleum Corp............................................................. 40,950
-------------
FINANCIAL SERVICES -- 8.3%
29,000 Citigroup, Inc...................................................................... 1,611,313
33,000 Federal Home Loan Mortgage Corp..................................................... 1,553,062
12,000 Household International............................................................. 447,000
-------------
3,611,375
-------------
FOOD SERVICES -- 2.3%
25,000 McDonald's Corp..................................................................... 1,007,813
-------------
MACHINERY/ENGINEERING -- 1.6%
14,600 Caterpillar, Inc.................................................................... 687,112
-------------
MANUFACTURING -- 1.3%
6,900 Alcoa, Inc.......................................................................... 572,700
-------------
MEDIA/BROADCASTING -- 1.4%
7,700 AMFM, Inc.*......................................................................... 602,525
-------------
TECHNOLOGY -- 6.3%
31,300 Compaq Computer Corp................................................................ 847,056
20,000 Computer Associates International, Inc.............................................. 1,398,750
6,000 Intel Corp.......................................................................... 493,875
-------------
2,739,681
-------------
TELECOMMUNICATIONS -- 2.5%
7,400 Bell Atlantic Corp.................................................................. 455,562
12,000 MCI Worldcom. Inc.*................................................................. 636,750
-------------
1,092,312
-------------
TRANSPORTATION -- 1.6%
8,800 UAL Corp.*.......................................................................... 682,550
-------------
Total Common Stock (cost - $35,227,722)............................................. 40,598,715
-------------
</TABLE>
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS
DECEMBER 31, 1999
(CONCLUDED)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) VALUE
---------- -------------
<S> <C> <C>
U.S. GOVERNMENT AGENCY NOTES -- 6.8%
$2,925 Federal Home Loan Bank Discount Notes,
1.50%, 1/3/00 (cost - $2,924,756)............................................... $ 2,924,756
-------------
<CAPTION>
<S> <C> <C> <C>
Total Investments (cost - $38,152,478).................................... 100.3% 43,523,471
Liabilities in excess of other assets..................................... (0.3) (111,912)
----- -----------
Net Assets................................................................ 100.0% $43,411,559
----- -----------
----- -----------
</TABLE>
- ------------------
* Non-income producing security
+ Preferred Stock
ADR -- American Depositary Receipt
GDR -- Global Depositary Receipt
See accompanying notes to financial statements.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 1999
<TABLE>
<S> <C>
ASSETS:
Investments, at value (cost - $38,152,478)......................................................... $ 43,523,471
Cash............................................................................................... 68,839
Receivable for shares of beneficial interest sold.................................................. 39,893
Dividends and tax reclaims receivable.............................................................. 35,135
Prepaid expenses................................................................................... 367
-------------
Total Assets..................................................................................... 43,667,705
-------------
LIABILITIES:
Payable for investments purchased.................................................................. 172,004
Payable for shares of beneficial interest redeemed................................................. 40,121
Investment advisory fee payable.................................................................... 5,142
Accrued expenses................................................................................... 38,879
-------------
Total Liabilities................................................................................ 256,146
-------------
Net Assets....................................................................................... $ 43,411,559
-------------
-------------
COMPOSITION OF NET ASSETS:
Beneficial interest shares of $0.01 par value (unlimited shares authorized)........................ $ 26,210
Paid-in-capital in excess of par................................................................... 36,410,702
Accumulated net investment loss.................................................................... (3,139)
Accumulated net realized gain on investments....................................................... 1,607,569
Net unrealized appreciation on investments and other assets and liabilities denominated
in foreign currency.............................................................................. 5,370,217
-------------
Net Assets....................................................................................... $ 43,411,559
-------------
-------------
Shares outstanding................................................................................. 2,620,954
-------------
NET ASSET VALUE, OFFERING PRICE AND REDEMPTION PRICE PER SHARE..................................... $16.56
-------------
-------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1999
<TABLE>
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $48,142)........................................... $ 541,052
Interest.......................................................................................... 56,633
------------
Total investment income........................................................................ 597,685
------------
EXPENSES:
Investment advisory fees.......................................................................... 302,528
Custodian fees.................................................................................... 75,593
Audit and tax service fees........................................................................ 18,172
Trustees' fees and expenses....................................................................... 7,625
Transfer agent fees............................................................................... 5,505
Reports to shareholders........................................................................... 3,434
Legal fees........................................................................................ 895
Miscellaneous..................................................................................... 2,801
------------
Total expenses................................................................................. 416,553
Less: expense offset........................................................................... (687)
------------
Net expenses................................................................................... 415,866
------------
Net investment income........................................................................ 181,819
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain on investments.................................................................. 8,245,602
Net realized loss on foreign currency transactions................................................ (34,255)
Net change in unrealized appreciation/depreciation on investments and other assets and liabilities
denominated in foreign currency................................................................ 648,000
------------
Net realized and unrealized gain on investments and foreign currency transactions............ 8,859,347
------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................................................ $ 9,041,166
------------
------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1999 1998
---------------- --------------------
<S> <C> <C>
OPERATIONS:
Net investment income..................................................... $ 181,819 $ 242,532
Net realized gain on investments.......................................... 8,245,602 1,274,387
Net realized gain (loss) on foreign currency transactions................. (34,255) 23,150
Net change in unrealized appreciation/depreciation on investments and
other assets and liabilities denominated in foreign currency............ 648,000 1,899,363
------------ ------------
Net increase in net assets resulting from operations................. 9,041,166 3,439,432
------------ ------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income..................................................... (569,505) (375,199)
Net realized gains........................................................ (6,011,036) (1,323,870)
------------ ------------
Total dividends and distributions to shareholders.................... (6,580,541) (1,699,069)
------------ ------------
SHARE TRANSACTIONS:
Net proceeds from the sales of shares..................................... 15,608,376 11,034,344
Reinvestment of dividends and distributions............................... 6,580,541 1,699,069
Cost of shares redeemed................................................... (16,015,175) (5,570,212)
------------ ------------
Net increase in net assets from share transactions................... 6,173,742 7,163,201
------------ ------------
Total increase in net assets......................................... 8,634,367 8,903,564
NET ASSETS:
Beginning of year......................................................... 34,777,192 25,873,628
------------ ------------
End of year............................................................... $ 43,411,559 $ 34,777,192
------------ ------------
------------ ------------
SHARES ISSUED AND REDEEMED:
Issued.................................................................... 889,280 692,242
Issued in reinvestment of dividends and distributions..................... 397,827 110,115
Redeemed.................................................................. (920,505) (354,531)
------------ ------------
Net increase......................................................... 366,602 447,826
------------ ------------
------------ ------------
</TABLE>
See accompanying notes to financial statements.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
FINANCIAL HIGHLIGHTS
FOR A SHARE OF BENEFICIAL INTEREST OUTSTANDING THROUGHOUT EACH PERIOD:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, FOR THE PERIOD
------------------------------------------- MARCH 1, 1995(1) TO
1999 1998 1997 1996 DECEMBER 31, 1995
------- ------- ------- ------- --------------------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of period......... $15.43 $14.32 $13.23 $11.61 $10.00
------- ------- ------- ------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income...................... 0.31 0.12 0.06 0.04 0.05
Net realized and unrealized gain on
investments and foreign currency
transactions............................ 3.78 1.78 1.79 1.70 1.83
------- ------- ------- ------- --------
Total income from investment
operations............................ 4.09 1.90 1.85 1.74 1.88
------- ------- ------- ------- --------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income................. (0.26) (0.18) (0.04) (0.05) (0.03)
In excess of net investment income......... -- -- (0.03) -- --
From net realized gains.................... (2.70) (0.61) (0.69) (0.07) (0.24)
------- ------- ------- ------- --------
Total dividends and distributions to
shareholders.......................... (2.96) (0.79) (0.76) (0.12) (0.27)
------- ------- ------- ------- --------
Net asset value, end of period............... $16.56 $15.43 $14.32 $13.23 $11.61
------- ------- ------- ------- --------
------- ------- ------- ------- --------
TOTAL RETURN (2)............................. 26.5% 13.3% 14.0% 15.0% 18.9%
------- ------- ------- ------- --------
------- ------- ------- ------- --------
RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (000's)............ $43,412 $34,777 $25,874 $16,972 $2,891
Ratio of expenses to average net assets (3).. 1.10% 1.13% 1.19%(4) 1.42%(4) 1.25%(4)(5)
Ratio of net investment income to average net
assets..................................... 0.48% 0.79% 0.45%(4) 0.81%(4) 1.02%(4)(5)
Portfolio Turnover........................... 83% 55% 53% 40% 67%
</TABLE>
- ------------------
(1) Commencement of operations
(2) Assumes reinvestment of all dividends and distributions. Total return for a
period of less than one year is not annualized.
(3) Inclusive of expenses offset by earnings credits from custodian bank (See 1H
in Notes to Financial Statements).
(4) During the fiscal periods indicated above, the Adviser waived a portion or
all of its fees and assumed a portion of the Portfolio's expenses. If such
waivers and assumptions had not been in effect, the ratios of expenses to
average net assets and the ratios of net investment income (loss) to average
net assets would have been 1.20% and 0.44%, respectively, for the year ended
December 31, 1997, and 1.83% and 0.40%, respectively, for the year ended
December 31, 1996 and 3.94% (annualized) and (1.67)%, (annualized),
respectively, for the period March 1, 1995 (commencement of operations) to
December 31, 1995.
(5) Annualized
See accompanying notes to financial statements.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
OCC Accumulation Trust (the "Trust") was organized May 12, 1994 as a
Massachusetts business trust and is registered under the Investment Company Act
of 1940, as amended, as a diversified, open-end management investment company.
The Trust is authorized to issue an unlimited number of shares of beneficial
interest at $.01 par value. The Trust is comprised of: the Equity Portfolio, the
Small Cap Portfolio, the Global Equity Portfolio (the "Portfolio"), the Managed
Portfolio, the U.S. Government Income Portfolio and the Mid Cap Portfolio. OpCap
Advisors (the "Adviser"), a subsidiary of Oppenheimer Capital, serves as the
Trust's investment adviser. The accompanying financial statements and notes
thereto are those of the Portfolio. The Trust is an investment vehicle for
variable annuity and variable life insurance contracts of various life insurance
companies, and qualified pension and retirement plans.
The following is a summary of significant accounting policies consistently
followed by the Portfolio in the preparation of its financial statements:
(A) VALUATION OF INVESTMENTS
Investment securities, other than debt securities, listed on a U.S. or foreign
securities exchange or traded in the over-the-counter National Market System are
valued each business day at the last reported sale price; if there are no such
reported sales, the securities are valued at their last quoted bid price. Other
securities traded over-the-counter and not part of the National Market System
are valued at the last quoted bid price. Debt securities (other than short-term
obligations) are valued each business day by an independent pricing service
(approved by the Board of Trustees) using methods which include current market
quotations from a major market maker in the securities and trader-reviewed
"matrix" prices. Short-term debt securities having a remaining maturity of sixty
days or less are valued at amortized cost or amortized value, which approximates
market value. Any securities or other assets for which market quotations are not
readily available are valued at fair value as determined in good faith by the
Board of Trustees. The ability of issuers of debt instruments to meet their
obligations may be affected by economic developments in a specific industry or
region.
(B) FEDERAL INCOME TAXES
It is the Portfolio's policy to continue to comply with the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to shareholders; accordingly,
no federal income tax provision is required.
(C) INVESTMENT TRANSACTIONS AND OTHER INCOME
Investment transactions are accounted for on the trade date. In determining the
gain or loss from the sale of investments, the cost of investments sold has been
determined on the basis of identified cost. Dividend income is recorded on the
ex-dividend date, except certain dividends from foreign securities that are
recorded as soon after the ex-dividend date as the Portfolio, using reasonable
diligence, becomes aware of such dividends. Interest income is accrued as
earned. Discounts or premiums on debt securities purchased are accreted or
amortized to interest income over the lives of the respective securities using
the effective interest method.
(D) FOREIGN CURRENCY TRANSLATION
The books and records of the Portfolio are maintained in U.S. dollars as
follows: (1) the foreign currency market value of investments and other assets
and liabilities denominated in foreign currency are translated at the prevailing
exchange rate on the valuation dates; (2) purchases and sales of investments,
income and expenses are translated at the rates of exchange prevailing on the
respective dates of such transactions. The resulting net foreign currency gain
or loss is included in the Statement of Operations.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(CONTINUED)
(1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES--(CONTINUED)
(D) FOREIGN CURRENCY TRANSLATION (CONCLUDED)
The Portfolio does not generally isolate that portion of the results of
operations arising as a result of changes in the foreign currency exchange rates
from fluctuations arising from changes in the market prices of securities.
Accordingly, such foreign currency gain (loss) is included in net realized and
unrealized gain (loss) on investments. However, the Portfolio does isolate the
effect of fluctuations in foreign currency exchange rates when determining the
gain or loss upon the sale or maturity of foreign currency denominated debt
obligations pursuant to U.S. federal income tax regulations; such amount is
categorized as foreign currency gain or loss for both financial reporting and
income tax reporting purposes.
Net foreign currency gain (loss) from valuing foreign currency denominated
assets and liabilities at period end exchange rates is reflected as a component
of net unrealized appreciation of investments and other assets and liabilities
denominated in foreign currency. Net realized foreign currency gain (loss) is
treated as ordinary income (loss) for income tax reporting purposes.
(E) DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders from net investment income and net
realized capital gains, if any, are declared and paid at least annually.
The Portfolio records dividends and distributions to its shareholders on the
ex-dividend date. The amount of dividends and distributions are determined in
accordance with federal income tax regulations, which may differ from generally
accepted accounting principles. These "book-tax" differences are either
considered temporary or permanent in nature. To the extent these differences are
permanent in nature, such amounts are reclassified within the capital accounts
based on their federal income tax treatment; temporary differences do not
require reclassification. To the extent dividends and/or distributions exceed
current and accumulated earnings and profits for federal income tax purposes,
they are reported as dividends and/or distributions of paid-in-capital or as a
tax return of capital.
As a result of permanent book/tax differences primarily attributable to the sale
of a passive foreign investment company, $525,950 has been reclassified from
accumulated net realized gain on investments to accumulated net investment loss.
Net assets were not affected by this reclassification.
(F) ALLOCATION OF EXPENSES
Expenses specifically identifiable to a particular portfolio are borne by that
portfolio. Other expenses are allocated to each portfolio of the Trust based on
its net assets in relation to the total net assets of all applicable portfolios
of the Trust or another reasonable basis.
(G) USE OF ESTIMATES
The preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts and disclosures in the financial statements. Actual
results could differ from those estimates.
(H) EXPENSE OFFSET
The Portfolio benefits from an expense offset arrangement with its custodian
bank whereby uninvested cash balances earn credits which reduce monthly
custodian fees. Had these cash balances been invested in income producing
securities, they would have generated income for the Portfolio.
<PAGE>
OCC ACCUMULATION TRUST
GLOBAL EQUITY PORTFOLIO
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(CONCLUDED)
(1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES--(CONCLUDED)
(I) TRUSTEES' RETIREMENT PLAN
The Trustees have adopted a Retirement Plan (the "Plan") effective January 1,
1999. The Plan provides for payments upon retirement to independent Trustees
based on the average annual compensation paid to them during their five highest
paid years of service. An independent Trustee must serve for a minimum of seven
years (or such lessor period as may be approved by the Board of Trustees) to
become eligible to receive benefits. For the year ended December 31, 1999, the
Portfolio accrued $3,139 in connection with the Plan.
(2) INVESTMENT ADVISORY FEE
The investment advisory fee is accrued daily and payable monthly to the Adviser,
and is computed as a percentage of the Portfolio's net assets as of the close of
business each day at the annual rate of 0.80% on the first $400 million, 0.75%
on the next $400 million and 0.70% thereafter. The Adviser is contractually
obligated to waive that portion of the advisory fee and to assume any necessary
expense to limit total operating expenses of the Portfolio to 1.25% of average
net assets (net of any expense offset) on an annual basis.
(3) INVESTMENTS IN SECURITIES
For federal income tax purposes the cost of securities owned at December 31,
1999 was $38,279,383. Accordingly, net unrealized appreciation of investments of
$5,244,088 was comprised of gross appreciation of $7,586,798 for those
investments having an excess of value over cost and gross depreciation of
$2,342,710 for those investments having an excess of cost over value.
For the year ended December 31, 1999, purchases and sales of investment
securities, other than short-term securities, aggregated $30,272,747 and
$31,338,748, respectively.
(4) ACQUISITION OF INVESTMENT ADVISER
On October 31, 1999, PIMCO Advisors Holdings L.P. ("PAH"), its operating
subisidiary, PIMCO Advisors L.P. ("PIMCO Advisors"), and Allianz AG ("Allianz")
announced that they have reached a definitive agreement for Allianz, a German
insurance company, to acquire majority ownership of PIMCO Advisors, including
all of the interests held by PAH (the "Allianz Transaction"). For the Portfolio,
the change of control as a result of the consummation of the Allianz Transaction
(expected to close by the end of the first quarter of 2000) will result in the
automatic termination of the current investment advisory agreement with OpCap
Advisors, an indirect wholly-owned subsidiary of PIMCO Advisors. The Board of
Trustees have approved a new agreement with OpCap Advisors to become effective
upon consummation of the Allianz Transaction. The new agreement will be
submitted for approval by the stockholders of the Portfolio.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Trustees of
OCC Accumulation Trust--Global Equity Portfolio
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of the Global Equity Portfolio (one of
the portfolios of OCC Accumulation Trust, hereafter referred to as the
"Portfolio") at December 31, 1999, the results of its operations for the year
then ended, the changes in its net assets for each of the two years in the
period then ended and the financial highlights for each of the four years in the
period then ended and for the period March 1, 1995 (commencement of operations)
through December 31, 1995, in conformity with accounting principles generally
accepted in the United States of America. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Portfolio's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with auditing standards
generally accepted in the United States of America, which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits, which included confirmation of securities at
December 31, 1999 by correspondence with the custodian and brokers, provide a
reasonable basis for the opinion expressed above.
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, New York 10036
February 11, 2000
<PAGE>
OCC ACCUMULATION TRUST
1345 AVENUE OF THE AMERICAS
NEW YORK, NY 10105
<TABLE>
<S> <C>
TRUSTEES AND PRINCIPAL OFFICERS
Joseph M. LaMotta Trustee, President
V. Lee Barnes Trustee
Paul Y. Clinton Trustee
Thomas W. Courtney Trustee
Lacy B. Herrmann Trustee
Theodore T. Mason Trustee
Steven Calabria Vice President
Bernard H. Garil Vice President
Mark F. Degenhart Vice President and Portfolio Manager
John C. Giusio, Jr. Vice President
Richard J. Glasebrook, II Vice President and Portfolio Manager
Colin Glinsman Vice President and Portfolio Manager
Louis Goldstein Vice President and Portfolio Manager
Benjamin D. Gutstein Vice President and Portfolio Manager
Vikki Hanges Vice President and Portfolio Manager
Jeffrey J. Hughes Vice President
Timothy J. McCormack Vice President and Portfolio Manager
Eric V. Retzlaff Vice President
James Sheldon Vice President and Portfolio Manager
Brian S. Shlissel Treasurer
Elliot M. Weiss Secretary
Maria Camacho Assistant Secretary
</TABLE>
INVESTMENT ADVISER
OpCap Advisors
1345 Avenue of the Americas
New York, NY 10105
CUSTODIAN AND TRANSFER AGENT
State Street Bank and Trust Company
P.O. Box 1978
Boston, MA 02105
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP
1177 Avenue of the Americas
New York, NY 10036
This report is authorized for distribution only
to shareholders and to others who have received
a copy of this Trust's prospectus.
