UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-21268
Oppenheimer Total Return Bond Fund
(Exact name of registrant as specified in charter)
6803 SOUTH TUCSON WAY, CENTENNIAL, COLORADO 80112-3924
(Address of principal executive offices)
(Zip code)
Robert G. Zack, Esq.
OppenheimerFunds, Inc.
498 Seventh Avenue, New York, New York 10018
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(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
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Date of fiscal year end: April 30
Date of reporting period: February 21, 2003 - April 30, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
STATEMENT OF INVESTMENTS April 30, 2003
Principal Market Value
Amount See Note 1
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Asset-Backed Securities--3.1%
BMW Vehicle Owner Trust, Automobile Loan Certificates,
Series 2003-A, Cl. A2, 1.45%, 11/25/05 $ 190,000 $ 190,000
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Centex Home Equity Co. LLC, Home Equity Loan Asset-Backed Certificates, Series 2003-A,
Cl. AF1, 1.836%, 10/25/17 59,309 59,257
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CitiFinancial Mortgage Securities, Inc., Home Equity Collateralized Mtg. Obligations, Series 2003-1,
Cl. AF1, 1.94%, 1/25/33 1 150,732 150,764
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Residential Funding Mortgage Securities II, Inc., Home Equity Loan Pass-Through Certificates,
Series 2003-HS1, Cl. AI2, 1.422%, 1/25/33 1,2 219,166 219,134
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Toyota Auto Receivables Owner Trust, Automobile Mortgage-Backed Obligations, Series 2003-A,
Cl. A2, 1.28%, 8/15/05 260,000 259,961
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Total Asset-Backed Securities (Cost $879,196) 879,116
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Mortgage-Backed Obligations--41.1%
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Government Agency--39.2%
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FHLMC/FNMA/Sponsored--39.2%
Federal Home Loan Mortgage Corp., Structured Pass-Through Securities, Collateralized Mtg.
Obligations, Series H006, Cl. A1, 1.724%, 4/15/08 1 140,000 140,000
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Federal National Mortgage Assn.:
5.50%, 5/16/18-5/13/33 3 995,000 1,028,237
6%, 5/16/18-5/25/33 3 2,391,000 2,493,914
6.50%, 5/1/18-5/25/33 3 2,820,000 2,953,803
7%, 5/25/33-6/25/33 3 4,374,000 4,622,132
8.50%, 7/1/32 46,653 50,337
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11,288,423
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Private--1.9%
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Commercial--1.9%
Bear Stearns Commercial Mortgage Securities, Inc., Commercial Mtg. Obligations, Series 2003-T10,
Cl. A1, 4%, 3/13/40 172,000 174,284
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GE Capital Commercial Mortgage Corp., Commercial Mtg. Obligations, Series 2003-C1, Cl. A2,
4.093%, 1/10/38 138,000 140,525
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J.P. Morgan Chase Commercial Mortgage Securities Corp., Commercial Mtg. Pass-Through Certificates,
Series 2003-ML1A, Cl. A1, 3.972%, 3/12/39 103,000 104,439
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Prudential Mortgage Capital Co. II LLC, Commercial Mtg. Pass-Through Certificates,
Series PRU-HTG 2000-C1, Cl. A2, 7.306%, 10/6/15 117,000 137,782
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557,030
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Total Mortgage-Backed Obligations (Cost $11,797,124) 11,845,453
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U.S. Government Obligations--37.6%
Federal Home Loan Mortgage Corp. Unsec. Nts., 4.50%, 1/15/13 1,000,000 1,023,490
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Federal National Mortgage Assn. Unsec. Nts., 4.25%, 7/15/07 1,150,000 1,219,031
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U.S. Treasury Bonds:
5.375%, 2/15/31 17,000 18,555
6.875%, 8/15/25 1,500,000 1,912,911
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U.S. Treasury Nts.:
1.625%, 3/31/05 1,807,000 1,812,931
3%, 2/15/08 258,000 260,741
3.875%, 2/15/13 98,000 98,161
5.875%, 11/15/04 1,555,000 1,662,818
7%, 7/15/06 2,450,000 2,821,425
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Total U.S. Government Obligations (Cost $10,796,811) 10,830,063
5 | OPPENHEIMER TOTAL RETURN BOND FUND
STATEMENT OF INVESTMENTS Continued
Principal Market Value
Amount See Note 1
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Corporate Bonds and Notes--14.1%
AT&T Wireless Services, Inc.:
7.50% Sr. Unsec. Nts., 5/1/07 $ 140,000 $ 158,132
8.75% Sr. Unsec. Nts., 3/1/31 50,000 62,485
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AXA Group, 8.60% Unsec. Sub. Nts., 12/15/30 90,000 108,781
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Citizens Communications Co., 9.25% Sr. Nts., 5/15/11 65,000 82,302
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Core Investment Grade Bond Trust I, 4.727% Pass-Through
Certificates, Series 2002-1, 11/30/07 1,000,000 1,036,415
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Deutsche Telekom International BV, 8.75% Unsec. Unsub. Nts., 6/15/30 40,000 49,605
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DTE Energy Co., 6.375% Sr. Nts., 4/15/33 85,000 89,428
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Federated Department Stores, Inc., 6.625% Sr. Nts., 4/1/11 70,000 77,620
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FirstEnergy Corp., 7.375% Sr. Unsub. Nts., Series C, 11/15/31 90,000 99,555
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Ford Motor Co., 7.45% Bonds, 7/16/31 110,000 98,171
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France Telecom SA, 10% Sr. Unsec. Nts., 3/1/31 2 55,000 73,406
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Franklin Resources, Inc., 3.70% Nts., 4/15/08 49,000 49,168
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General Motors Acceptance Corp., 6.875% Unsec. Unsub. Nts., 8/28/12 270,000 275,042
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Hertz Corp. (The), 7.625% Sr. Nts., 6/1/12 200,000 200,500
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Household Finance Corp., 7% Nts., 5/15/12 100,000 114,725
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Hutchison Whampoa International Ltd., 6.50% Nts., 2/13/13 4 90,000 91,419
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J.P. Morgan Chase & Co., 6.75% Sub. Nts., 2/1/11 63,000 71,850
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MidAmerican Energy Holdings Co., 5.875% Sr. Nts., 10/1/12 130,000 136,113
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Morgan Stanley, 6.60% Nts., 4/1/12 70,000 79,381
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News America Holdings, Inc., 7.75% Sr. Unsec. Debs., 12/1/45 120,000 136,997
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Northrop Grumman Corp., 7.125% Sr. Nts., 2/15/11 75,000 87,965
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Prudential Holdings LLC, 8.695% Bonds, Series C, 12/18/23 4 100,000 121,818
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Rogers Wireless Communications, Inc., 9.625% Sr. Sec. Nts., 5/1/11 21,000 23,231
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Simon DeBartolo Group LP, 6.875% Unsec. Nts., 11/15/06 80,000 88,775
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TECO Energy, Inc., 10.50% Sr. Unsec. Nts., 12/1/07 37,000 42,180
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Time Warner Entertainment Co. LP, 8.375% Sr. Debs., 3/15/23 40,000 49,442
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Time Warner, Inc., 9.125% Debs., 1/15/13 90,000 110,225
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Verizon Global Funding Corp., 7.75% Sr. Unsub. Nts., 12/1/30 130,000 161,137
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Vornado Realty LP, 5.625% Sr. Unsec. Unsub. Nts., 6/15/07 65,000 66,988
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Walt Disney Co. (The), 6.375% Sr. Unsec. Nts., 3/1/12 95,000 104,100
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Waste Management, Inc., 7% Sr. Nts., 7/15/28 115,000 127,662
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Total Corporate Bonds and Notes (Cost $3,999,144) 4,074,618
Shares
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Common Stocks--4.4%
iShares GS$ InvesTop Corp. Bond Fund (Cost $1,248,186) 11,400 1,277,370
6 | OPPENHEIMER TOTAL RETURN BOND FUND
Principal Market Value
Amount See Note 1
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Structured Notes--12.2%
JPMorgan Chase Bank, High Yield Index Credit Linked
Trust Nts., 7.55%, 11/15/07 $ 980,392 $ 1,045,343
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Lehman Brothers Holdings, Inc., Targeted Return Index Securities Linked Nts., Series 10-2002,
6.961%, 1/15/12 4,5 1,095,000 1,244,321
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Morgan Stanley, Tradable Custodial Receipt Nts., 6.799%, 6/15/12 4,5 1,080,000 1,214,742
--------------
Total Structured Notes (Cost $3,426,924) 3,504,406
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Joint Repurchase Agreements--23.9% 6
Undivided interest of 2.06% in joint repurchase agreement (Principal Amount/Market Value $332,883,000,
with a maturity value of $332,894,651) with Banc One Capital Markets, Inc., 1.26%, dated 4/30/03, to
be repurchased at $6,872,241 on 5/1/03, collateralized by U.S. Treasury Nts., 4.875%--5.875%,
11/15/04--2/15/12, with a value of $327,261,153 and U.S. Treasury Bonds, 2.125%, 8/31/04, with a
value of $12,489,849 (Cost $6,872,000) 6,872,000 6,872,000
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Total Investments, at Value (Cost $39,019,385) 136.4% 39,283,026
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Liabilities in Excess of Other Assets (36.4) (10,477,440)
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Net Assets 100.0% $ 28,805,586
===============================
Footnotes to Statement of Investments
1. Identifies issues considered to be illiquid--See Note 7 of Notes to Financial
Statements.
2. Represents the current interest rate for a variable or increasing rate
security.
3. When-issued security to be delivered and settled after April 30, 2003.
4. Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities have
been determined to be liquid under guidelines established by the Board of
Trustees. These securities amount to $2,672,300 or 9.28% of the Fund's net
assets as of April 30, 2003.
5. Interest rate represents a weighted average rate comprised of the interest
rates of the underlying securities.
6. The Fund may have elements of risk due to concentrated investments. Such
concentrations may subject the Fund to additional risks.
See accompanying Notes to Financial Statements.
7 | OPPENHEIMER TOTAL RETURN BOND FUND
STATEMENT OF ASSETS AND LIABILITIES April 30, 2003
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Assets
Investments, at value (including cost and market value of
$6,872,000 in repurchase agreements)
(cost $39,019,385)--see accompanying statement $ 39,283,026
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Cash 15,202
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Due from broker 80,000
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Receivables and other assets:
Interest 298,545
Shares of beneficial interest sold 226,386
Daily variation on futures contracts 175,487
Investments sold 59,512
Other 9
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Total assets 40,138,167
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Liabilities
Payables and other liabilities:
Investments purchased (including $11,080,960 purchased on a when-issued basis) 11,258,707
Dividends 37,568
Distribution and service plan fees 9,641
Trustees' compensation 395
Shares of beneficial interest redeemed 350
Transfer and shareholder servicing agent fees 289
Other 25,631
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Total liabilities 11,332,581
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Net Assets $28,805,586
==============
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Composition of Net Assets
Par value of shares of beneficial interest $ 2,858
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Additional paid-in capital 28,567,102
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Undistributed net investment income 9,712
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Accumulated net realized loss on investments and foreign currency transactions (718)
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Net unrealized appreciation on investments 226,632
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Net Assets $28,805,586
==============
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Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share
(based on net assets of $27,598,182 and 2,738,137 shares of
beneficial interest outstanding) $10.08
Maximum offering price per share (net asset value
plus sales charge of 4.75% of offering price) $10.58
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Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $798,162 and
79,195 shares of beneficial interest outstanding) $10.08
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Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $387,741 and
38,483 shares of beneficial interest outstanding) $10.08
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Class N Shares:
Net asset value, redemption price (excludes applicable contingent deferred
sales charge) and offering price per share (based on net assets of $21,501 and
2,133 shares of beneficial interest outstanding) $10.08
See accompanying Notes to Financial Statements.
8 | OPPENHEIMER TOTAL RETURN BOND FUND
STATEMENT OF OPERATIONS For the Period Ended April 30, 2003 1
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Investment Income
Interest $ 123,064
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Dividends 10,312
-----------
Total investment income 133,376
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Expenses
Management fees 24,656
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Distribution and service plan fees:
Class A 9,555
Class B 617
Class C 228
Class N 5
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Transfer and shareholder servicing agent fees:
Class A 372
Class B 231
Class C 71
Class N 11
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Shareholder reports 10,109
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Professional fees 9,943
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Trustees' compensation 395
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Custodian fees and expenses 162
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Other 8,970
-----------
Total expenses 65,325
Less reduction to custodian expenses (162)
Less voluntary waiver of expenses (19,307)
Less voluntary waiver of transfer and shareholder servicing agent fees--Class B (52)
Less voluntary waiver of transfer and shareholder servicing agent fees--Class C (50)
Less voluntary waiver of transfer and shareholder servicing agent fees--Class N (11)
-----------
Net expenses 45,743
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Net Investment Income 87,633
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Realized and Unrealized Gain (Loss)
Net realized loss on:
Investments (342)
Closing of futures contracts (100)
Foreign currency transactions (276)
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Net realized loss (718)
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Net change in unrealized appreciation (depreciation) on:
Investments 263,641
Futures contracts (37,009)
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Net unrealized appreciation 226,632
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Net Increase in Net Assets Resulting from Operations $313,547
===========
1. For the period from February 21, 2003 (commencement of operations) to April
30, 2003.
See accompanying Notes to Financial Statements.
9 | OPPENHEIMER TOTAL RETURN BOND FUND
STATEMENT OF CHANGES IN NET ASSETS
Period Ended April 30, 2003 1
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Operations
Net investment income $ 87,633
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Net realized loss (718)
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Net change in unrealized appreciation 226,632
----------------
Net increase in net assets resulting from operations 313,547
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Dividends and/or Distributions to Shareholders
Dividends from net investment income:
Class A (87,071)
Class B (550)
Class C (143)
Class N (16)
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Beneficial Interest Transactions
Net increase in net assets resulting from beneficial interest transactions:
Class A 27,282,368
Class B 790,499
Class C 383,530
Class N 20,422
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Net Assets
Total increase 28,702,586
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Beginning of period 103,000 2
----------------
End of period [including undistributed net investment income of $9,712] $28,805,586
================
1. For the period from February 21, 2003 (commencement of operations) to April
30, 2003.
2. Reflects the value of the Manager's initial seed money investment on
February 6, 2003.
See accompanying Notes to Financial Statements.
10 | OPPENHEIMER TOTAL RETURN BOND FUND
FINANCIAL HIGHLIGHTS
Class A Class B
Period Period
Ended Ended
April 30, April 30,
2003 1 2003 1
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Per Share Operating Data
Net asset value, beginning of period $ 10.00 $ 10.00
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Income (loss) from investment operations:
Net investment income .03 .02
Net realized and unrealized gain .08 .08
------------------------
Total from investment operations .11 .10
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Dividends and/or distributions to shareholders:
Dividends from net investment income (.03) (.02)
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Net asset value, end of period $10.08 $10.08
========================
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Total Return, at Net Asset Value 2 1.14% 0.97%
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Ratios/Supplemental Data
Net assets, end of period (in thousands) $27,598 $798
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Average net assets (in thousands) $26,027 $340
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Ratios to average net assets: 3
Net investment income 1.77% 0.85%
Expenses, gross 1.29% 2.36%
Expenses, net 0.90% 4,5 1.65% 4,5,6
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Portfolio turnover rate 77% 77%
1. For the period from February 21, 2003 (commencement of operations) to April
30, 2003.
2. Assumes an investment at net asset value on the business day before the first
day of the fiscal period, with all dividends and distributions reinvested in
additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns. Total returns are not annualized for
periods of less than one full year. Returns do not reflect the deduction of
taxes a shareholder would pay on Fund distributions or the redemption of Fund
shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
5. Net of voluntary waiver of expenses.
6. Net of voluntary waiver of transfer agent fees.
See accompanying Notes to Financial Statements.
11 | OPPENHEIMER TOTAL RETURN BOND FUND
FINANCIAL HIGHLIGHTS Continued
Class C Class N
Period Period
Ended Ended
April 30, April 30,
2003 1 2003 1
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Per Share Operating Data
Net asset value, beginning of period $ 10.00 $ 10.00
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Income (loss) from investment operations:
Net investment income .02 .03
Net realized and unrealized gain .08 .08
------------------------
Total from investment operations .10 .11
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Dividends and/or distributions to shareholders:
Dividends from net investment income (.02) (.03)
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Net asset value, end of period $10.08 $10.08
========================
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Total Return, at Net Asset Value 2 0.96% 1.08%
- -------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $388 $22
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Average net assets (in thousands) $126 $ 6
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Ratios to average net assets: 3
Net investment income 0.59% 1.50%
Expenses, gross 2.28% 2.63%
Expenses, net 1.65% 4,5,6 1.15% 4,5,6
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Portfolio turnover rate 77% 77%
1. For the period from February 21, 2003 (commencement of operations) to April
30, 2003.
2. Assumes an investment at net asset value on the business day before the first
day of the fiscal period, with all dividends and distributions reinvested in
additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns. Total returns are not annualized for
periods of less than one full year. Returns do not reflect the deduction of
taxes a shareholder would pay on Fund distributions or the redemption of Fund
shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
5. Net of voluntary waiver of expenses.
6. Net of voluntary waiver of transfer agent fees.
See accompanying Notes to Financial Statements.
12 | OPPENHEIMER TOTAL RETURN BOND FUND
NOTES TO FINANCIAL STATEMENTS
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1. Significant Accounting Policies
Oppenheimer Total Return Bond Fund (the Fund) is registered under the
Investment Company Act of 1940, as amended, as an open-end management
investment company. The Fund's investment objective is to seek high total
return through both capital appreciation and income. The Fund's investment
advisor is OppenheimerFunds, Inc. (the Manager). As of April 30, 2003, the
Manager and its affiliates owned 2,510,000, 100, 100 and 100 shares of Class A,
Class B, Class C and Class N, respectively.
The Fund currently offers Class A, Class B, Class C and Class N shares.
Class A shares are sold at their offering price, which is normally net asset
value plus a front-end sales charge. Class B, Class C and Class N shares are
sold without a front-end sales charge but may be subject to a contingent
deferred sales charge (CDSC). Class N shares are sold only through retirement
plans. Retirement plans that offer Class N shares may impose charges on those
accounts. All classes of shares have identical rights and voting privileges.
Earnings, net assets and net asset value per share may differ by minor amounts
due to each class having its own expenses directly attributable to that class.
Classes A, B, C and N have separate distribution and/or service plans. 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.
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Securities Valuation. Securities listed or traded on National Stock Exchanges
or other domestic or foreign exchanges are valued based on the last sale price
of the security traded on that exchange prior to the time when the Fund's
assets and liabilities are valued. In the absence of a sale, the security is
valued at the last sale price on the prior trading day, if it is within the
spread of the current day's closing bid and asked prices, and if not, at the
current day's closing bid price. Securities (including restricted securities)
for which quotations are not readily available are valued primarily using
dealer-supplied valuations, a portfolio pricing service authorized by the Board
of Trustees, or at their fair value. Fair value is determined in good faith
under consistently applied procedures under the supervision of the Board of
Trustees. Short-term "money market type" debt securities with remaining
maturities of sixty days or less are valued at amortized cost (which
approximates market value).
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Structured Notes. The Fund invests in index-linked structured notes whose
principal and/or interest depend on the performance of an underlying index. The
structured notes are leveraged, which increases the volatility of each note's
market value relative to the change in the underlying index. Fluctuations in
value of these securities are recorded as unrealized gains and losses in the
accompanying financial statements. The Fund records a realized gain or loss
when a structured note is sold or matures. As of April 30, 2003, the market
value of these securities comprised 12.2% of the Fund's net assets, and
resulted in unrealized gains in the current period of $77,482.
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Securities on a When-Issued Basis. Delivery and payment for securities that
have been purchased by the Fund on a when-issued basis can take place a month
or more after the trade date. Normally the settlement date occurs within six
months after the trade date; however, the Fund may, from time to time, purchase
securities whose settlement date extends six months or more beyond trade date.
During this period, such securities do not earn interest, are subject to market
fluctuation and may increase or decrease in value prior to their delivery. The
Fund maintains segregated assets with a market value equal to or greater than
the amount of its purchase commitments. As of April 30, 2003, the value of the
segregated assets was $11,255,993. The purchase of securities on a when-issued
basis may increase the volatility of the Fund's net asset value to the extent
the Fund makes such purchases while remaining substantially fully invested. As
of April 30, 2003, the Fund had entered into when-issued purchase commitments
of $11,080,960.
In connection with its ability to purchase securities on a when-issued
basis, the Fund may enter into forward roll transactions with respect to
mortgage-related securities. Forward roll transactions require the sale of
securities for delivery in the current month, and a simultaneous agreement with
the same counterparty to repurchase similar (same type, coupon and maturity)
but not identical securities on a specified future date. The forward roll may
not extend for a period of greater than one year. The Fund generally records
the incremental difference between the forward purchase and sale of each
forward roll as interest income over the roll period.
13 | OPPENHEIMER TOTAL RETURN BOND FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
1. Significant Accounting Policies Continued
Risks to the Fund of entering into forward roll transactions include the
potential inability of the counterparty to meet the terms of the agreement; the
potential of the Fund to receive inferior securities to what was sold to the
counterparty at redelivery; counterparty credit risk; and the potential pay
down speed variance between the mortgage-related pools.
- --------------------------------------------------------------------------------
Foreign Currency Translation. The accounting records of the Fund are maintained
in U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of foreign securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions.
The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains
and losses in the Fund's Statement of Operations.
- --------------------------------------------------------------------------------
Joint Repurchase Agreements. The Fund, along with other affiliated funds of the
Manager, may transfer uninvested cash balances into one or more joint
repurchase agreement accounts. These balances are invested in one or more
repurchase agreements, secured by U.S. government securities. Securities
pledged as collateral for repurchase agreements are held by a custodian bank
until the agreements mature. Each agreement requires that the market value of
the collateral be sufficient to cover payments of interest and principal;
however, in the event of default by the other party to the agreement, retention
of the collateral may be subject to legal proceedings.
- --------------------------------------------------------------------------------
Allocation of Income, Expenses, Gains and Losses. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated daily
to each class of shares based upon the relative proportion of net assets
represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
Federal Taxes. The Fund intends to continue to comply with provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its investment company taxable income,
including any net realized gain on investments not offset by capital loss
carryforwards, if any, to shareholders. Therefore, no federal income or excise
tax provision is required.
As of April 30, 2003, the Fund had approximately $21,000 of post-October
losses available to offset future capital gains, if any. Such losses, if
unutilized, will expire in 2012. Additionally, the Fund had approximately $300
of post-October foreign currency losses which were deferred.
- --------------------------------------------------------------------------------
Dividends and Distributions to Shareholders. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income distributions, if any, are
declared and paid monthly. Capital gain distributions, if any, are declared
daily and paid annually.
- --------------------------------------------------------------------------------
Classification of Dividends and Distributions to Shareholders. Net investment
income (loss) and net realized gain (loss) may differ for financial statement
and tax purposes primarily due to paydown gains and losses and the recognition
of certain foreign currency gains (losses) as ordinary income (loss) for tax
purposes. The character of dividends and distributions made during the fiscal
year from net investment income or net realized gains may differ from their
ultimate characterization for federal income tax purposes. Also, due to timing
of dividends and distributions, the fiscal year in which amounts are
distributed may differ from the fiscal year in which the income or net realized
gain was recorded by the Fund.
The Fund adjusts the classification of distributions to shareholders to
reflect the differences between financial statement amounts and distributions
determined in accordance with income tax regulations. Accordingly, during the
period ended April 30, 2003, amounts have been reclassified to reflect a
decrease in paid-in capital of $9,859. Overdistributed net investment income
was decreased by the same amount. Net assets of the Fund were unaffected by the
reclassifications.
14 | OPPENHEIMER TOTAL RETURN BOND FUND
The tax character of distributions paid during the period ended April 30, 2003
was as follows:
Period Ended
April 30, 2003 1
-------------------------------------------------
Distributions paid from:
Ordinary income $ 87,780
1. For the period from February 21, 2003 (commencement of operations) to April
30, 2003.
As of April 30, 2003, the components of distributable earnings on a tax basis
were as follows:
Undistributed net investment income $ 16,550
Accumulated net realized loss (32,492)
Net unrealized appreciation 258,406
-----------
Total $242,464
===========
- --------------------------------------------------------------------------------
Investment Income. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and
amortization of premium, is accrued as earned.
- --------------------------------------------------------------------------------
Security Transactions. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.
- --------------------------------------------------------------------------------
Expense Offset Arrangement. The reduction of custodian fees represents earnings
on cash balances maintained by the Fund.
- --------------------------------------------------------------------------------
Other. The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America 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 $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial
interest were as follows:
Period Ended April 30, 2003 1,2
Shares Amount
- ------------------------------------------------------------------------------------------------------
Class A
Sold 2,736,090 $ 27,361,875
Dividends and/or distributions reinvested 275 2,768
Redeemed (8,228) (82,275)
------------------------------------
Net increase 2,728,137 $27,282,368
====================================
- ------------------------------------------------------------------------------------------------------
Class B
Sold 88,955 $ 888,971
Dividends and/or distributions reinvested 36 365
Redeemed (9,896) (98,837)
------------------------------------
Net increase 79,095 $ 790,499
====================================
- ------------------------------------------------------------------------------------------------------
Class C
Sold 39,178 $ 391,527
Dividends and/or distributions reinvested 10 103
Redeemed (805) (8,100)
------------------------------------
Net increase 38,383 $ 383,530
====================================
15 | OPPENHEIMER TOTAL RETURN BOND FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
2. Shares of Beneficial Interest Continued
Period Ended April 30, 2003 1,2
Shares Amount
- ----------------------------------------------------------------------------------------------
Class N
Sold 2,032 $ 20,408
Dividends and/or distributions reinvested 1 14
-----------------------------
Net increase 2,033 $ 20,422
=============================
1. For the period from February 21, 2003 (commencement of operations) to April
30, 2003.
2. The Fund sold 10,000 shares of Class A at a value of $100,000 and 100 shares
each of Class B, Class C and Class N at a value of $1,000, respectively, to the
Manager upon seeding of the Fund on February 6, 2003.
- --------------------------------------------------------------------------------
3. Purchases and Sales of Securities
The aggregate cost of purchases and proceeds from sales of securities, other
than U.S. government obligations and short-term obligations, for the period
ended April 30, 2003, were $10,478,011 and $191,419, respectively. There were
purchases of $42,174,665 and sales of $20,259,763 of U.S. government and
government agency obligations for the period ended April 30,2003.
As of April 30, 2003, unrealized appreciation (depreciation) based on cost of
securities for federal income tax purposes of $39,019,385 was composed of:
Gross unrealized appreciation $ 279,519
Gross unrealized depreciation (15,878)
----------
Net unrealized appreciation $ 263,641
==========
The difference between book-basis and tax-basis unrealized appreciation and
depreciation, if applicable, is attributable primarily to the tax deferral of
losses on or the tax realization of unrealized gain or loss.
- --------------------------------------------------------------------------------
4. Fees and Other Transactions with Affiliates
Management Fees. Management fees paid to the Manager were in accordance with
the investment advisory agreement with the Fund which provides for a fee at an
annual rate of 0.50% of the first $250 million of average annual net assets of
the Fund, 0.475% of the next $500 million, and 0.45% of average annual net
assets in excess of $750 million. The Manager has voluntarily agreed to waive
fees and reimburse expenses such that "Total Annual Operating Expenses" will
not exceed 0.90% for Class A shares, 1.65% for Class B Shares, 1.65% for Class
C shares, and 1.15% for Class N shares, respectively. The voluntary waivers
described above may be amended or withdrawn at any time. For the period ended
April 30, 2003, management fees in the amount of $19,307 were voluntarily
waived by the Manager.
- --------------------------------------------------------------------------------
Transfer Agent Fees. OppenheimerFunds Services (OFS), a division of the
Manager, acts as the transfer and shareholder servicing agent for the Fund.
The Fund pays OFS a $22.50 per account fee.
OFS has voluntarily agreed to limit transfer and shareholder servicing agent
fees for all classes, up to an annual rate of 0.35% of average net assets per
class. This undertaking may be amended or withdrawn at any time.
- --------------------------------------------------------------------------------
Offering and Organizational Costs. The Manager assumed all offering and
organizational costs associated with the registration and seeding of the Fund.
- --------------------------------------------------------------------------------
Distribution and Service Plan (12b-1) Fees. Under its General Distributor's
Agreement with the Manager, OppenheimerFunds Distributor, Inc. (the
Distributor) acts as the Fund's principal underwriter in the continuous public
offering of the different classes of shares of the Fund.
16 | OPPENHEIMER TOTAL RETURN BOND FUND
The compensation paid to (or retained by) the Distributor from the sale of
shares or on the redemption of shares is shown in the table below for the
period indicated.
Aggregate Class A Concessions Concessions Concessions Concessions
Front-End Front-End on Class A on Class B on Class C on Class N
Sales Charges Sales Charges Shares Shares Shares Shares
on Class A Retained by Advanced by Advanced by Advanced by Advanced by
Period Ended Shares Distributor Distributor 1 Distributor 1 Distributor 1 Distributor 1
- -------------------------------------------------------------------------------------------------------------------------------
April 30, 2003 $22,204 $9,189 $10 $9,448 $2,528 $87
1. The Distributor advances concession payments to dealers for certain sales of
Class A shares and for sales of Class B, Class C and Class N shares from its own
resources at the time of sale.
Class A Class B Class C Class N
Contingent Deferred Contingent Deferred Contingent Deferred Contingent Deferred
Sales Charges Sales Charges Sales Charges Sales Charges
Retained by Retained by Retained by Retained by
Period Ended Distributor Distributor Distributor Distributor
- -----------------------------------------------------------------------------------------------------------------------
April 30, 2003 $-- $-- $-- $--
- --------------------------------------------------------------------------------
Service Plan for Class A Shares. The Fund has adopted a Service Plan for Class
A Shares. It reimburses the Distributor for a portion of its costs incurred for
services provided to accounts that hold Class A shares. Reimbursement is made
quarterly at an annual rate of up to 0.25% of the average annual net assets of
Class A shares of the Fund. For the period ended April 30, 2003, payments under
the Class A Plan totaled $9,555, all of which were paid by the Distributor to
recipients, none of which was paid to an affiliate of the Manager. Any
unreimbursed expenses the Distributor incurs with respect to Class A shares in
any fiscal year cannot be recovered in subsequent years.
- --------------------------------------------------------------------------------
Distribution and Service Plans for Class B, Class C and Class N Shares. The
Fund has adopted Distribution and Service Plans for Class B, Class C and Class
N shares. Under the plans, the Fund pays the Distributor an annual asset-based
sales charge of 0.75% per year on Class B shares and on Class C shares and the
Fund pays the Distributor an annual asset-based sales charge of 0.25% per year
on Class N shares. The Distributor also receives a service fee of 0.25% per
year under each plan.
Distribution fees paid to the Distributor for the period ended April 30, 2003,
were as follows:
Distributor's Aggregate
Distributor's Aggregate Unreimbursed
Total Payments Amount Retained Unreimbursed Expenses Expenses as % of
Under Plan by Distributor Under Plan Net Assets of Class
- ----------------------------------------------------------------------------------------------------------------------
Class B Plan $617 $-- $-- --%
Class C Plan 228 -- -- --
Class N Plan 5 -- -- --
- --------------------------------------------------------------------------------
5. Foreign Currency Contracts
A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into
foreign currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and to seek to protect against adverse
exchange rate fluctuation. Risks to the Fund include the potential inability of
the counterparty to meet the terms of the contract.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation
or depreciation.
The Fund may realize a gain or loss upon the closing or settlement of the
forward transaction. Such realized gains and losses are reported with all other
foreign currency gains and losses in the Statement of Operations.
As of April 30, 2003, the Fund had no outstanding foreign currency
contracts.
17 | OPPENHEIMER TOTAL RETURN BOND FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
6. Futures Contracts
A futures contract is a commitment to buy or sell a specific amount of a
commodity or financial instrument at a particular price on a stipulated future
date at a negotiated price. Futures contracts are traded on a commodity
exchange. The Fund may buy and sell futures contracts that relate to broadly
based securities indices (financial futures) or debt securities (interest rate
futures) in order to gain exposure to or to seek to protect against changes in
market value of stock and bonds or interest rates. The Fund may also buy or
write put or call options on these futures contracts.
The Fund generally sells futures contracts to hedge against increases in
interest rates and decreases in market value of portfolio securities. The Fund
may also purchase futures contracts to gain exposure to market changes as it
may be more efficient or cost effective than actually buying fixed income
securities.
Upon entering into a futures contract, the Fund is required to deposit
either cash or securities (initial margin) in an amount equal to a certain
percentage of the contract value. Subsequent payments (variation margin) are
made or received by the Fund each day. The variation margin payments are equal
to the daily changes in the contract value and are recorded as unrealized gains
and losses. The Fund recognizes a realized gain or loss when the contract is
closed or expires.
Cash held by the broker to cover initial margin requirements on open futures
contracts is noted in the Statement of Assets and Liabilities. The Statement of
Assets and Liabilities reflects a receivable and/or payable for the daily mark
to market for variation margin. Realized gains and losses are reported on the
Statement of Operations at the closing and expiration of futures contracts. The
net change in unrealized appreciation and depreciation is reported on the
Statement of Operations.
Risks of entering into futures contracts (and related options) include the
possibility that there may be an illiquid market and that a change in the value
of the contract or option may not correlate with changes in the value of the
underlying securities.
As of April 30, 2003, the Fund had outstanding futures contracts as follows:
Expiration Number of Valuation as of Unrealized
Contract Description Dates Contracts April 30, 2003 Depreciation
- -----------------------------------------------------------------------------------------------------------------------
Contracts to Purchase
Euro-Bundesobligation 6/6/03 7 $ 896,818 $ 5,234
----------
Contracts to Sell
U.S. Treasury Bonds 6/19/03 5 570,156 5,750
U.S. Treasury Nts., 2 yr. 6/26/03 4 863,625 1,053
U.S. Treasury Nts., 5 yr. 6/19/03 56 6,370,000 14,555
U.S. Treasury Nts., 10 yr. 6/19/03 12 1,381,500 10,417
----------
31,775
----------
$37,009
==========
- --------------------------------------------------------------------------------
7. Illiquid Securities
As of April 30, 2003, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund intends to invest no more than 15% of its net assets (determined at the
time of purchase and reviewed periodically) in illiquid securities. The
aggregate value of illiquid securities subject to this limitation as of April
30, 2003 was $509,898, which represents 1.77% of the Fund's net assets.
18 | OPPENHEIMER TOTAL RETURN BOND FUND
- --------------------------------------------------------------------------------
8. Borrowing and Lending Arrangements
Interfund Borrowing and Lending Arrangements. The Fund entered into an
"interfund borrowing and lending arrangement" with other funds in the
Oppenheimer funds complex, to allow funds to borrow for liquidity purposes. The
arrangement was initiated pursuant to exemptive relief granted by the
Securities and Exchange Commission to allow these affiliated funds to lend
money to, and borrow money from, each other, in an attempt to reduce borrowing
costs below those of bank loan facilities. Under the arrangement the Fund may
lend money to other Oppenheimer funds and may borrow from other Oppenheimer
funds at a rate set by the Fund's Board of Trustees, based upon a
recommendation by the Manager. The Fund's borrowings, if any, are subject to
asset coverage requirements under the Investment Company Act and the provisions
of the SEC order and other applicable regulations. If the Fund borrows money,
there is a risk that the loan could be called on one day's notice, in which
case the Fund might have to borrow from a bank at higher rates if a loan were
not available from another Oppenheimer fund. If the Fund lends money to another
fund, it will be subject to the risk that the other fund might not repay the
loan in a timely manner, or at all.
The Fund had no interfund borrowings or loans outstanding during the period
ended or at April 30, 2003.
19 | OPPENHEIMER TOTAL RETURN BOND FUND
INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------
To the Shareholders and Board of Trustees of Oppenheimer Total Return Bond Fund
We have audited the accompanying statement of assets and liabilities of
Oppenheimer Total Return Bond Fund (the "Fund"), including the statement of
investments, as of April 30, 2003, and the related statements of operations and
changes in net assets and the financial highlights for the period from February
21, 2003 (commencement of operations) to April 30, 2003. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audit.
We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
and financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of securities
owned as of April 30, 2003, by correspondence with the custodian and others. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
OPPENHEIMER TOTAL RETURN BOND FUND at April 30, 2003, and the results of its
operations, the changes in its net assets and the financial highlights for the
period from February 21, 2003 to April 30, 2003, in conformity with accounting
principles generally accepted in the United States.
/s/ Ernst & Young LLP
New York, New York
June 6, 2003
20 | OPPENHEIMER TOTAL RETURN BOND FUND
TRUSTEES AND OFFICERS Unaudited
- ---------------------------------------------------------------------------------------------------------------------------------
Name, Position(s) Held with Principal Occupation(s) During Past 5 Years; Other Trusteeships/Directorships Held by Trustee;
Fund, Length of Service, Age Number of Portfolios in Fund Complex Currently Overseen by Trustee
INDEPENDENT The address of each Trustee and Interested Trustee in the charts below is 6803 S. Tucson
TRUSTEES Way, Centennial, CO 80112-3924. Each Trustee serves for an indefinite term, until his or
her resignation, retirement, death or removal.
Ronald J. Abdow, President (since 1959) of Abdow
Trustee (since 2003) Corporation (operator of restaurants); Trustee of the following real estate businesses
Age: 71 (owners and operators of restaurants): G&R Realty Co. Trust (since 1978), G&R Trust
(since 1973), Abdow Partnership (since 1975), Auburn Associates (since 1983); Hazard
Associates (since 1985); Chairman (since 1996) of Western Mass Development Corp.
(non-profit development); Chairman of American International College (non-profit
college); Trustee (since 1993) of MML Series Investment Fund and Trustee (since 1994) of
MassMutual Institutional Funds (MMIF) (open-end investment companies). Oversees 9 port-
folios in the OppenheimerFunds complex.
Joseph M. Wikler, Self-employed as an investment consultant; a director (since 1996) of Lakes
Trustee (since 2003) Environmental Association, and Medintec (since 1992) and Cathco (since 1995) (medical
Age: 62 device companies); and a member of the investment committee of the Associated Jewish
Charities of Baltimore (since 1994); formerly a director of Fortis/Hartford mutual funds
(1994 - December 2001). Oversees 7 portfolios in the OppenheimerFunds complex.
Peter I. Wold, President of Wold Properties, Inc. (an oil and gas exploration and production company);
Trustee (since 2003) Vice President, Secretary and Treasurer of Wold Trona Company, Inc. (soda ash processing and
Age: 55 production); Vice President of Wold Talc Company, Inc. (talc mining); Managing Member,
Hole-in-the-Wall Ranch (cattle ranching); formerly Director and Chairman of the Board,
Denver Branch of the Federal Reserve Bank of Kansas City (1993-1999) and Director of
PacifiCorp. (1995 - 1999), an electric utility. Oversees 7 portfolios in the
OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE
Eustis Walcott, Principal with Ardsley Associates (since 2000) (consulting firm); formerly Senior Vice
Trustee (since 2003) President, MassMutual Financial Group (May 1990 - July 2000). Trustee (since 2000) of
Age: 65 Cornerstone Real Estate Advisors and MML Investors Services, Trustee of OFI Trust
Company (since 2001) and of the American International College (since 1995). Oversees 7
portfolios in the OppenheimerFunds complex.
- ---------------------------------------------------------------------------------------------------------------------------------
INTERESTED TRUSTEE The address of Mr. Murphy in the chart below is 498 Seventh Avenue, New York, NY 10018.
AND OFFICER Mr. Murphy serves for an indefinite term, until his resignation, death or removal.
John V. Murphy, Chairman, Chief Executive Officer and director (since June 2001) and President (since
President, Trustee and September 2000) of the Manager; President and a director or trustee of other Oppenheimer
Chairman of the Board, funds; President and a director (since July 2001) of Oppenheimer Acquisition Corp. (the
Trustee (since 2003) Manager's parent holding company) and of Oppenheimer Partnership Holdings, Inc. (a
Age: 53 holding company subsidiary of the Manager); a director (since November 2001) of
OppenheimerFunds Distributor, Inc. (a subsidiary of the Manager); Chairman and a
director (since July 2001) of Shareholder Services, Inc. and of Shareholder Financial
Services, Inc. (transfer agent subsidiaries of the Manager); President and a director
(since July 2001) of OppenheimerFunds Legacy Program (a charitable trust program
established by the Manager); a director of the investment advisory subsidiaries of the
Manager: OFI Institutional Asset Management, Inc. and Centennial Asset Management
Corporation (since November 2001),
HarbourView Asset Management Corporation and OFI Private Investments, Inc. (since July
2001); President (since November 1, 2001) and a director (since July 2001) of
Oppenheimer Real Asset Management, Inc.; a director (since November 2001) of Trinity
Investment Management Corp. and Tremont Advisers, Inc. (Investment advisory affiliates
of the Manager); Executive Vice President (since February 1997) of Massachusetts Mutual
Life Insurance Company (the Manager's parent company); a director (since June 1995) of
DLB Acquisition Corporation (a holding company that owns the shares of David L. Babson &
Company, Inc.); formerly, Chief Operating Officer (September 2000-June 2001) of the
Manager; President and trustee (November 1999-November 2001) of MML Series Investment
Fund and MassMutual Institutional Funds (open-end investment companies); a director
(September 1999-August 2000) of C.M. Life Insurance Company; President, Chief Executive
Officer and director (September 1999-August 2000) of MML Bay State Life Insurance
Company; a director (June 1989-June 1998) of Emerald Isle Bancorp and Hibernia Savings
Bank (a wholly-owned subsidiary of Emerald Isle Bancorp). Oversees 74 portfolios in the
OppenheimerFunds complex.
22 | OPPENHEIMER TOTAL RETURN BOND FUND
- ---------------------------------------------------------------------------------------------------------------------------------
OFFICERS The address of the Officers in the chart below is as follows: for Messrs. Manioudakis
and Zack, 498 Seventh Avenue, New York, NY 10018, for Mr. Wixted, 6803 S. Tucson Way,
Centennial, CO 80112-3924. Each Officer serves for an annual term or until his or her
earlier resignation, death or removal.
Angelo Manioudakis, Senior Vice President of the Manager (since April 2002); an officer of 12 portfolios in
Vice President (since 2003) the OppenheimerFunds complex; formerly Executive Director and portfolio manager for
Age: 36 Miller, Anderson & Sherrerd, a division of Morgan Stanley Investment Management (August
1993-April 2002).
Brian W. Wixted, Senior Vice President and Treasurer (since March 1999) of the Manager; Treasurer (since
Treasurer, Principal Financial March 1999) of HarbourView Asset Management Corporation, Shareholder Services, Inc.,
and Accounting Officer Oppenheimer Real Asset Management Corporation, Shareholder Financial Services, Inc.,
(since 2003) Oppenheimer Partnership Holdings, Inc., OFI Private Investments, Inc. (since March
Age: 43 2000), OppenheimerFunds International Ltd. and Oppenheimer Millennium Funds plc (since
May 2000) and OFI Institutional Asset Management, Inc. (since November 2000); Treasurer
and Chief Financial Officer (since May 2000) of Oppenheimer Trust Company (a trust
company subsidiary of the Manager); Assistant Treasurer (since March 1999) of
Oppenheimer Acquisition Corp. and OppenheimerFunds Legacy Program (since April 2000);
formerly Principal and Chief Operating Officer (March 1995-March 1999) of Bankers Trust
Company-Mutual Fund Services Division. An officer of 90 portfolios in the
OppenheimerFunds complex.
Robert G. Zack, Senior Vice President (since May 1985) and General Counsel (since February 2002) of the
Secretary (since 2003) Manager; General Counsel and a director (since November 2001) of OppenheimerFunds
Age: 54 Distributor, Inc.; Senior Vice President and General Counsel (since November 2001) of
HarbourView Asset Management Corporation; Vice President and a director (since November
2000) of Oppenheimer Partnership Holdings, Inc.; Senior Vice President, General Counsel
and a director (since November 2001) of Shareholder Services, Inc., Shareholder
Financial Services, Inc., OFI Private Investments, Inc., Oppenheimer Trust Company and
OFI Institutional Asset Management, Inc.; General Counsel (since November 2001) of
Centennial Asset Management Corporation; a director (since November 2001) of Oppenheimer
Real Asset Management, Inc.; Assistant Secretary and a director (since November 2001) of
OppenheimerFunds International Ltd.; Vice President (since November 2001) of
OppenheimerFunds Legacy Program; Secretary (since November 2001) of Oppenheimer
Acquisition Corp.; formerly Acting General Counsel (November 2001-February 2002) and
Associate General Counsel (May 1981-October 2001) of the Manager; Assistant Secretary of
Shareholder Services, Inc. (May 1985-November 2001), Shareholder Financial Services,
Inc. (November 1989-November 2001); OppenheimerFunds International Ltd. And Oppenheimer
Millennium Funds plc (October 1997-November 2001). An officer of 90 portfolios in the
OppenheimerFunds complex.
The Fund's Statement of Additional Information contains additional information
about the Fund's Trustees and is available without charge upon request.
23 | OPPENHEIMER TOTAL RETURN BOND FUND
ITEM 2. CODE OF ETHICS - NOT REQUIRED
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT - NOT REQUIRED
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES - NOT REQUIRED
ITEM 5. RESERVED
ITEM 6. RESERVED
ITEM 7. NOT APPLICABLE
ITEM 8. RESERVED
ITEM 9. CONTROLS AND PROCEDURES
(a) Based on their evaluation of registrant's disclosure controls and
procedures (as defined in rule 30a-2(c) under the Investment Company
Act of 1940 (17 CFR 270.30a-2(c)) as of April 30, 2003, registrant's
principal executive officer and principal financial officer found
registrant's disclosure controls and procedures to be appropriately
designed to ensure that information required to be disclosed by
registrant in the reports that it files under the Securities Exchange
Act of 1934 (a) is accumulated and communicated to registrant's
management, including its principal executive officer and principal
financial officer, to allow timely decisions regarding required
disclosure, and (b) is recorded, processed, summarized and reported,
within the time periods specified in the rules and forms adopted by the
U.S. Securities and Exchange Commission.
(b) There have been no significant changes in registrant's internal
controls or in other factors that could significantly affect
registrant's internal controls subsequent to the date of the most
recent evaluation as indicated, including no significant deficiencies
or material weaknesses that required corrective action.
ITEM 10. EXHIBITS ATTACHED HERETO. (ATTACH CERTIFICATIONS AS EXHIBITS)