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 811-09365
OPPENHEIMER TRINITY VALUE 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
- --------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
--------------
Date of fiscal year end: July 31
Date of reporting period: August 1, 2002 - July 31, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
FUND PERFORMANCE DISCUSSION
How has the Fund performed? Below is a discussion by OppenheimerFunds, Inc., of
the Fund's performance during its fiscal year ended July 31, 2003, followed by a
graphical comparison of the Fund's performance to an appropriate broad-based
market index.
Management's Discussion of Fund Performance. Over the 12-month period ended July
31, 2003, the Fund's performance was driven primarily by the stock market's
broadly based upward trend. The Fund participated in the market's rise,
delivering above-average returns in some industry areas, such as financial
services, consumer staples and utilities, and below-average returns in others,
such as consumer cyclicals and health care.
At the same time, the Fund remained true to its disciplined and systematic
investment process. It was essentially fully invested in equities at all times,
holding only stocks listed in the S&P 500/BARRA Value Index and maintaining
portfolio sector weights generally reflecting those of the Index. Our buy, hold
and sell decisions remained based on our computer-based modeling tools, with
more than 60 stock ranking and valuation techniques. Higher-ranked stocks were
purchase candidates, while lower-ranked stocks were either avoided or
underweighted.
The Fund achieved its best performance compared to the S&P 500/BARRA Value
Index in the financial services area. Strong holdings included Capital One
Financial Corp., a consumer finance company that rebounded from unusually low
valuations reached in October 2002. In another area of financial services, the
Fund realized particularly good returns from its investments in money-center
banks, such as Citigroup, Inc., that benefited from aggressive cost cutting,
improved investment banking revenues and a mortgage refinancing boom fueled by
low interest rates. These gains more than compensated for disappointments
generated by a small number of financial services holdings, including Household
International, Inc. and MBNA Corp., both of which were sold during the period.
Although consumer staples stocks declined in the S&P 500 BARRA/Value Index,
the Fund delivered positive performance in the area on the strength of several
good stock selections. Specifically, we generated positive returns with
investments in Archer-Daniels-Midland Corp., a producer of agricultural
commodities, and with the timely purchase and sale of Coca-Cola Enterprises,
Inc. a leading soft drink bottler. Returns also benefited from our decision to
avoid investments in most food, beverage and tobacco producers, and food and
drug retailers, which generally lost ground during the period. Within the
utilities sector, the Fund benefited from an overweighting in telecommunication
stocks, such as Sprint Corp. (Fon Group), as well as the decision to underweight
SBC Communications, Inc. which declined during the reporting period.
A small number of holdings in other areas also made significant positive
contributions to the Fund's relative performance for the period, including
computer hardware maker
5 | OPPENHEIMER TRINITY VALUE FUND
FUND PERFORMANCE DISCUSSION
Hewlett-Packard Co. which advanced on the basis of strengthening business
fundamentals and in improving outlook.
On the other hand, the strong gains cited above were balanced by weaker-than-
average performance in the areas of consumer cyclicals and health care. Among
consumer cyclicals, the Fund invested a greater percentage of assets than the
benchmark's weighting in two stocks that suffered significant declines at the
time they were held: retailer Sears Roebuck & Co., and media and entertainment
company Tribune Co. Declines in the Fund's health care holdings were led by
insurer Cigna Corp., which failed to meet earnings expectations during the
fourth quarter of 2002. As a result, health care proved to be one of the few
sectors in which the Fund failed to produce positive returns during the
reporting period. In addition, the Fund's relative performance was undermined by
the bankruptcy of TXU Corp., an energy holding.
While the Fund's disciplined investment approach remained essentially
unchanged, we continued to refine our library of stock ranking models with the
intent of enhancing the effectiveness of our approach during the period. The
Fund's portfolio holdings, allocations and strategies are subject to change.
Comparing the Fund's Performance to the Market. The graphs that follow show the
performance of a hypothetical $10,000 investment in each Class of shares of the
Fund held until July 31, 2003.The performance for Class A, B, C and Y shares is
measured from inception on September 1, 1999. In the case of Class N shares,
performance is measured from inception of the Class on March 1, 2001. The Fund's
performance reflects the deduction of the maximum initial sales charge on Class
A shares and the applicable contingent deferred sales charge for Class B, Class
C and Class N shares shares. The graphs assume that all dividends and capital
gains distributions were reinvested in additional shares.
The Fund's performance is compared to the performance of the S&P 500 BARRA/
Value Index, a capitalization-weighted index comprised of stocks of the S&P 500
Index with lower book-to-price ratios relative to the S&P 500 Index as a whole.
Each company of the S&P 500 Index is assigned to either the Barra/Value or
Barra/Growth index so that the sum of the two indices reflects the total S&P 500
Index. Index performance reflects the reinvestment of dividends but does not
consider the effect of capital gains or transaction costs, and none of the data
in the graphs that follow shows the effect of taxes. The Fund's performance
reflects the effects of Fund business and operating expenses. While index
comparisons may be useful to provide a benchmark for the Fund's performance, it
must be noted that the Fund's investments may not be limited to those
investments found in an index.
6 | OPPENHEIMER TRINITY VALUE FUND
Class A Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:
Oppenheimer Trinity Value Fund (Class A)
S&P 500 BARRA/Value Index
[LINE GRAPH OMITTED]
Oppenheimer
Trinity Value S&P 500 BARRA/
Fund (Class A) Value Index
09/01/1999 9,425 10,000
10/31/1999 9,152 10,151
01/31/2000 8,774 10,137
04/30/2000 9,057 10,425
07/31/2000 9,001 10,246
10/31/2000 9,908 11,134
01/31/2001 9,889 11,577
04/30/2001 9,927 11,087
07/31/2001 9,596 10,653
10/31/2001 8,405 9,084
01/31/2002 8,891 9,538
04/30/2002 8,822 9,439
07/31/2002 7,265 7,919
10/31/2002 6,910 7,650
01/31/2003 6,851 7,550
04/30/2003 7,186 8,060
07/31/2003 7,984 8,910
Average Annual Total Returns of Class A Shares of the Fund at 7/31/03*
1-Year 3.59% Since Inception -5.59%
Class B Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:
Oppenheimer Trinity Value Fund (Class B)
S&P 500 BARRA/Value Index
[LINE GRAPH OMITTED]
Oppenheimer
Trinity Value S&P 500 BARRA/
Fund (Class B) Value Index
09/01/1999 10,000 10,000
10/31/1999 9,690 10,151
01/31/2000 9,282 10,137
04/30/2000 9,552 10,425
07/31/2000 9,482 10,246
10/31/2000 10,405 11,134
01/31/2001 10,365 11,577
04/30/2001 10,375 11,087
07/31/2001 10,014 10,653
10/31/2001 8,750 9,084
01/31/2002 9,235 9,538
04/30/2002 9,151 9,439
07/31/2002 7,518 7,919
10/31/2002 7,141 7,650
01/31/2003 7,057 7,550
04/30/2003 7,392 8,060
07/31/2003 7,973 8,910
Average Annual Total Returns of Class B Shares of the Fund at 7/31/03*
1-Year 4.19% Since Inception -5.62%
*See Notes on page 10 for further details.
The performance information for the S&P 500 BARRA/Value Index in the graphs
begins on 8/31/99 for Class A, Class B, Class C and Class Y and on 2/28/01 for
Class N shares. Past performance cannot guarantee future results. Graphs are not
drawn to same scale.
7 | OPPENHEIMER TRINITY VALUE FUND
FUND PERFORMANCE DISCUSSION
Class C Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:
Oppenheimer Trinity Value Fund (Class C)
S&P 500 BARRA/Value Index
[LINE GRAPH OMITTED]
Oppenheimer
Trinity Value S&P 500 BARRA/
Fund (Class C) Value Index
09/01/1999 10,000 10,000
10/31/1999 9,690 10,151
01/31/2000 9,273 10,137
04/30/2000 9,653 10,425
07/31/2000 9,573 10,246
10/31/2000 10,503 11,134
01/31/2001 10,463 11,577
04/30/2001 10,483 11,087
07/31/2001 10,113 10,653
10/31/2001 8,843 9,084
01/31/2002 9,326 9,538
04/30/2002 9,243 9,439
07/31/2002 7,595 7,919
10/31/2002 7,209 7,650
01/31/2003 7,125 7,550
04/30/2003 7,459 8,060
07/31/2003 8,283 8,910
Average Annual Total Returns of Class C Shares of the Fund at 7/31/03*
1-Year 8.07% Since Inception -4.70%
Class N Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:
Oppenheimer Trinity Value Fund (Class N)
S&P 500 BARRA/Value Index
[LINE GRAPH OMITTED]
Oppenheimer
Trinity Value S&P 500 BARRA/
Fund (Class N) Value Index
03/01/2001 10,000 10,000
04/30/2001 10,438 10,257
07/31/2001 10,080 9,855
10/31/2001 8,816 8,404
01/31/2002 9,307 8,824
04/30/2002 9,234 8,732
07/31/2002 7,605 7,326
10/31/2002 7,232 7,077
01/31/2003 7,159 6,984
04/30/2003 7,501 7,456
07/31/2003 8,342 8,243
Average Annual Total Returns of Class N Shares of the Fund at 7/31/03*
1-Year 8.69% Since Inception -7.23%
*See Notes on page 10 for further details.
8 | OPPENHEIMER TRINITY VALUE FUND
Class Y Shares
Comparison of Change in Value of $10,000 Hypothetical Investments in:
Oppenheimer Trinity Value Fund (Class Y)
S&P 500 BARRA/Value Index
[LINE GRAPH OMITTED]
Oppenheimer
Trinity Value S&P 500 BARRA/
Fund (Class Y) Value Index
09/01/1999 10,000 10,000
10/31/1999 9,710 10,151
01/31/2000 9,316 10,137
04/30/2000 9,607 10,425
07/31/2000 9,567 10,246
10/31/2000 10,521 11,134
01/31/2001 10,511 11,577
04/30/2001 10,561 11,087
07/31/2001 10,220 10,653
10/31/2001 8,965 9,084
01/31/2002 9,471 9,538
04/30/2002 9,418 9,439
07/31/2002 7,765 7,919
10/31/2002 7,399 7,650
01/31/2003 7,346 7,550
04/30/2003 7,712 8,060
07/31/2003 8,591 8,910
Average Annual Total Returns of Class Y Shares of the Fund at 7/31/03*
1-Year 10.65% Since Inception -3.80%
The performance information for the S&P 500 BARRA/Value Index in the graphs
begins on 8/31/99 for Class A, Class B, Class C and Class Y and on 2/28/01 for
Class N shares.
Past performance cannot guarantee future results. Graphs are not drawn to same
scale.
9 | OPPENHEIMER TRINITY VALUE FUND
NOTES
In reviewing performance and rankings, please remember that past performance
cannot guarantee future results. Investment return and principal value of an
investment in the Fund will fluctuate so that an investor's shares, when
redeemed, may be worth more or less than the original cost. Because of ongoing
market volatility, the Fund's performance may be subject to substantial
fluctuations, and current performance may be more or less than the results
shown. For updates on the Fund's performance, visit our website at
www.oppenheimerfunds.com.
Total returns and the ending account values in the graph includes changes in
share price and reinvestment of dividends and capital gains distributions in a
hypothetical investment for the periods shown. The Fund's total returns shown do
not reflect the deduction of income taxes on an individual's investment. Taxes
may reduce your actual investment returns on income or gains paid by the Fund or
any gains you may realize if you sell your shares. The Fund's portfolio managers
are employed by the Fund's sub-advisor, Trinity Investment Management
Corporation, an affiliate of OppenheimerFunds, Inc., the Fund's investment
manager. For more complete information about the Fund, including charges,
expenses and risks, please refer to the prospectus. To obtain a copy, call your
financial advisor, call OppenheimerFunds Distributor, Inc. at 1.800.CALL OPP
(1.800.225.5677). Read the prospectus carefully before you invest or send money.
Class A shares of the Fund were first publicly offered on 9/1/99. Unless
otherwise noted, Class A total returns are shown net of the applicable 5.75%
maximum initial sales charge.
Class B shares of the Fund were first publicly offered on 9/1/99. Unless
otherwise noted, Class B total returns are shown net of the applicable
contingent deferred sales charge of 5% (1-year) and 3% (since inception). Class
B shares are subject to an annual 0.75% asset-based sales charge.
Class C shares of the Fund were first publicly offered on 9/1/99. Unless
otherwise noted Class C total returns are shown net of the 1% contingent
deferred sales charge for the 1-year period. Class C shares are subject to an
annual 0.75% asset-based sales charge.
Class N shares of the Fund were first publicly offered on 3/1/01. Class N shares
are offered only through retirement plans. Unless otherwise noted, Class N
returns include the contingent deferred sales charge of 1% for the 1-year
period. Class N shares are subject to an annual 0.25% asset-based sales charge.
Class Y shares of the Fund were first publicly offered on 9/1/99. Class Y shares
are only offered to certain institutional investors under special agreement with
the distributor.
An explanation of the calculation of performance is in the Fund's Statement of
Additional Information.
10 | OPPENHEIMER TRINITY VALUE FUND
STATEMENT OF INVESTMENTS July 31, 2003
Market Value
Shares See Note 1
- -----------------------------------------------------------------------
Common Stocks--96.3%
- -----------------------------------------------------------------------
Consumer Discretionary--13.7%
- -----------------------------------------------------------------------
Auto Components--2.3%
Johnson Controls, Inc. 2,200 $ 212,542
- -----------------------------------------------------------------------
Automobiles--3.6%
Ford Motor Co. 5,800 64,148
- -----------------------------------------------------------------------
General Motors Corp. 7,000 262,010
----------------
326,158
- -----------------------------------------------------------------------
Hotels, Restaurants & Leisure--0.8%
Harrah's Entertainment,
Inc. 1 1,600 69,840
- -----------------------------------------------------------------------
Household Durables--1.1%
Cavco Industries, Inc. 1 55 1,059
- -----------------------------------------------------------------------
Centex Corp. 1,300 94,341
----------------
95,400
- -----------------------------------------------------------------------
Media--3.9%
AOL Time Warner, Inc. 1 8,700 134,241
- -----------------------------------------------------------------------
Tribune Co. 3,100 146,382
- -----------------------------------------------------------------------
Viacom, Inc., Cl. B 1 1,800 78,336
----------------
358,959
- -----------------------------------------------------------------------
Textiles, Apparel & Luxury Goods--2.0%
Liz Claiborne, Inc. 5,400 185,922
- -----------------------------------------------------------------------
Consumer Staples--0.6%
- -----------------------------------------------------------------------
Food & Staples Retailing--0.6%
Winn-Dixie Stores, Inc. 4,800 55,008
- -----------------------------------------------------------------------
Energy--12.4%
- -----------------------------------------------------------------------
Oil & Gas--12.4%
Anadarko Petroleum
Corp. 1,600 70,080
- -----------------------------------------------------------------------
Apache Corp. 693 42,938
- -----------------------------------------------------------------------
ChevronTexaco Corp. 5,100 367,761
- -----------------------------------------------------------------------
Exxon Mobil Corp. 16,400 583,512
- -----------------------------------------------------------------------
Marathon Oil Corp. 2,400 61,776
----------------
1,126,067
- -----------------------------------------------------------------------
Financials--31.1%
- -----------------------------------------------------------------------
Commercial Banks--4.4%
Bank of America Corp. 700 57,799
- -----------------------------------------------------------------------
U.S. Bancorp 3,000 73,560
- -----------------------------------------------------------------------
Washington Mutual,
Inc. 6,700 264,516
----------------
395,875
Market Value
Shares See Note 1
- -----------------------------------------------------------------------
Diversified Financial Services--11.0%
Citigroup, Inc. 12,500 $ 560,000
- -----------------------------------------------------------------------
Lehman Brothers
Holdings, Inc. 2,700 170,829
- -----------------------------------------------------------------------
Morgan Stanley 5,700 270,408
----------------
1,001,237
- -----------------------------------------------------------------------
Insurance--11.2%
ACE Ltd. 5,200 171,548
- -----------------------------------------------------------------------
American International
Group, Inc. 7,900 507,180
- -----------------------------------------------------------------------
Safeco Corp. 3,200 119,136
- -----------------------------------------------------------------------
Torchmark Corp. 3,600 146,304
- -----------------------------------------------------------------------
Travelers Property
Casualty Corp., Cl. B 4,800 77,472
----------------
1,021,640
- -----------------------------------------------------------------------
Real Estate--3.7%
Apartment Investment
& Management Co. 2,100 82,761
- -----------------------------------------------------------------------
Equity Residential 1,800 50,220
- -----------------------------------------------------------------------
Simon Property
Group, Inc. 4,800 203,280
----------------
336,261
- -----------------------------------------------------------------------
Thrifts & Mortgage Finance--0.8%
Countrywide Financial
Corp. 1,100 73,491
- -----------------------------------------------------------------------
Health Care--1.0%
- -----------------------------------------------------------------------
Health Care Providers & Services--1.0%
Cigna Corp. 2,000 93,560
- -----------------------------------------------------------------------
Industrials--7.3%
- -----------------------------------------------------------------------
Aerospace & Defense--4.2%
Northrop Grumman
Corp. 1,500 138,360
- -----------------------------------------------------------------------
United Technologies
Corp. 3,300 248,259
----------------
386,619
- -----------------------------------------------------------------------
Commercial Services & Supplies--2.3%
Waste Management, Inc. 8,700 207,843
- -----------------------------------------------------------------------
Electrical Equipment--0.8%
Rockwell Automation,
Inc. 2,700 69,768
11 | OPPENHEIMER TRINITY VALUE FUND
STATEMENT OF INVESTMENTS Continued
Market Value
Shares See Note 1
- -----------------------------------------------------------------------
Information Technology--7.5%
- -----------------------------------------------------------------------
Computers & Peripherals--4.9%
EMC Corp. 1 4,000 $ 42,560
- -----------------------------------------------------------------------
Hewlett-Packard Co. 17,700 374,709
- -----------------------------------------------------------------------
Sun Microsystems, Inc. 1 7,100 26,554
----------------
443,823
- -----------------------------------------------------------------------
IT Services--2.3%
Computer Sciences
Corp. 1 400 16,228
- -----------------------------------------------------------------------
Unisys Corp. 1 15,900 194,934
----------------
211,162
- -----------------------------------------------------------------------
Semiconductors & Semiconductor Equipment--0.3%
Broadcom Corp., Cl. A 1 1,100 22,297
- -----------------------------------------------------------------------
Materials--6.1%
- -----------------------------------------------------------------------
Chemicals--2.3%
Dow Chemical Co. 5,800 204,740
- -----------------------------------------------------------------------
Containers & Packaging--3.8%
Bemis Co., Inc. 3,500 156,415
- -----------------------------------------------------------------------
Pactiv Corp. 1 9,800 193,550
----------------
349,965
- -----------------------------------------------------------------------
Telecommunication Services--11.8%
- -----------------------------------------------------------------------
Diversified Telecommunication Services--8.6%
BellSouth Corp. 9,800 249,606
- -----------------------------------------------------------------------
Sprint Corp.
(Fon Group) 16,000 225,920
- -----------------------------------------------------------------------
Verizon Communications,
Inc. 8,800 306,768
----------------
782,294
- -----------------------------------------------------------------------
Wireless Telecommunication Services--3.2%
AT&T Corp. 10,700 227,482
- -----------------------------------------------------------------------
AT&T Wireless
Services, Inc. 1 7,100 60,563
----------------
288,045
Market Value
Shares See Note 1
- -----------------------------------------------------------------------
Utilities--4.8%
- -----------------------------------------------------------------------
Electric Utilities--3.3%
FirstEnergy Corp. 1,400 $ 48,286
- -----------------------------------------------------------------------
Public Service Enterprise
Group, Inc. 1,800 73,350
- -----------------------------------------------------------------------
TXU Corp. 8,700 175,479
----------------
297,115
- -----------------------------------------------------------------------
Gas Utilities--1.5%
Sempra Energy 5,100 141,933
----------------
Total Common Stocks
(Cost $8,381,417) 8,757,564
Principal
Amount
- -----------------------------------------------------------------------
Joint Repurchase Agreements--3.7%
Undivided interest of 8.26% in
joint repurchase agreement
(Principal Amount/Market
Value $4,093,000, with a
maturity value of $4,093,117)
with Banc One Capital
Markets, Inc., 1.03%, dated
7/31/03, to be repurchased
at $338,010 on 8/1/03,
collateralized by U.S. Treasury
Nts., 3%, 2/29/04, with a
value of $4,178,213
(Cost $338,000) $338,000 338,000
- -----------------------------------------------------------------------
Total Investments,
at Value
(Cost $8,719,417) 100.0% 9,095,564
- -----------------------------------------------------------------------
Liabilities in Excess of
Other Assets 0.0 (2,430)
-----------------------------
Net Assets 100.0% $9,093,134
=============================
Footnotes to Statement of Investments
1. Non-income producing security.
See accompanying Notes to Financial Statements.
12 | OPPENHEIMER TRINITY VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES July 31, 2003
- --------------------------------------------------------------------------------
Assets
Investments, at value (cost $8,719,417)--
see accompanying statement $9,095,564
- --------------------------------------------------------------------------------
Cash 275
- --------------------------------------------------------------------------------
Receivables and other assets:
Shares of beneficial interest sold 46,720
Interest and dividends 12,923
Other 654
------------
Total assets 9,156,136
- --------------------------------------------------------------------------------
Liabilities
Payables and other liabilities:
Investments purchased 18,008
Shares of beneficial interest redeemed 14,901
Legal, auditing and other professional fees 11,696
Shareholder reports 11,463
Transfer and shareholder servicing agent fees 1,846
Distribution and service plan fees 1,601
Trustees' compensation 1,209
Other 2,278
------------
Total liabilities 63,002
- --------------------------------------------------------------------------------
Net Assets $9,093,134
============
- --------------------------------------------------------------------------------
Composition of Net Assets
Paid-in capital $10,809,307
- --------------------------------------------------------------------------------
Undistributed net investment income 21,920
- --------------------------------------------------------------------------------
Accumulated net realized loss on
investment transactions (2,114,240)
- --------------------------------------------------------------------------------
Net unrealized appreciation on investments 376,147
------------
Net Assets $9,093,134
============
13 | OPPENHEIMER TRINITY VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES Continued
- --------------------------------------------------------------------------------
Net Asset Value Per Share
Class A Shares:
Net asset value and redemption price per share (based on net assets of
$4,295,626 and 530,114 shares of beneficial interest outstanding) $8.10
Maximum offering price per share (net asset value plus sales charge of
5.75% of offering price) $8.59
- --------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $1,897,036 and 242,074 shares of beneficial interest
outstanding) $7.84
- --------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net
assets of $1,720,213 and 216,637 shares of beneficial interest
outstanding) $7.94
- --------------------------------------------------------------------------------
Class N Shares:
Net asset value, redemption price (excludes applicable contingent
deferred
sales charge) and offering price per share (based on net assets of
$536,220 and 66,734 shares of beneficial interest outstanding) $8.04
- --------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share
(based on net assets of $644,039 and 78,461 shares of beneficial
interest outstanding) $8.21
See accompanying Notes to Financial Statements.
14 | OPPENHEIMER TRINITY VALUE FUND
STATEMENT OF OPERATIONS FOR THE YEAR ENDED JULY 31, 2003
- ------------------------------------------------------------------------
Investment Income
Dividends $ 228,410
- ------------------------------------------------------------------------
Interest 5,031
------------
Total investment income 233,441
- ------------------------------------------------------------------------
Expenses
Management fees 69,123
- ------------------------------------------------------------------------
Distribution and service plan fees:
Class A 9,834
Class B 21,501
Class C 18,805
Class N 898
- ------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 17,641
Class B 15,577
Class C 9,078
Class N 620
- ------------------------------------------------------------------------
Shareholder reports 43,966
- ------------------------------------------------------------------------
Legal, auditing and other professional fees 12,007
- ------------------------------------------------------------------------
Custodian fees and expenses 735
- ------------------------------------------------------------------------
Trustees' compensation 484
- ------------------------------------------------------------------------
Other 8,347
------------
Total expenses 228,616
Less reduction to custodian expenses (19)
Less reimbursement of management fees (2,728)
Less voluntary waiver of transfer and
shareholder servicing agent fees--Class A (3,327)
Less voluntary waiver of transfer and
shareholder servicing agent fees--Class B (8,963)
Less voluntary waiver of transfer and
shareholder servicing agent fees--Class C (3,089)
Less voluntary waiver of transfer and
shareholder servicing agent fees--Class N (88)
------------
Net expenses 210,402
- ------------------------------------------------------------------------
Net Investment Income 23,039
- ------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized loss on investments (1,124,158)
- ------------------------------------------------------------------------
Net change in unrealized appreciation on investments 1,680,930
- ------------------------------------------------------------------------
Net Increase in Net Assets Resulting from Operations $ 579,811
============
See accompanying Notes to Financial Statements.
15 | OPPENHEIMER TRINITY VALUE FUND
STATEMENTS OF CHANGES IN NET ASSETS
Year Ended July 31, 2003 2002
- --------------------------------------------------------------------------------
Operations
Net investment income $ 23,039 $ 2,294
- --------------------------------------------------------------------------------
Net realized loss (1,124,158) (990,083)
- --------------------------------------------------------------------------------
Net change in unrealized
appreciation (depreciation) 1,680,930 (1,231,628)
-----------------------------
Net increase (decrease) in net assets
resulting from operations 579,811 (2,219,417)
- --------------------------------------------------------------------------------
Dividends and/or Distributions to Shareholders
Distributions from net realized gain:
Class A -- (147,195)
Class B -- (76,463)
Class C -- (64,231)
Class N -- (159)
Class Y -- (18,823)
- --------------------------------------------------------------------------------
Distributions in excess of net realized gain:
Class A -- (908)
Class B -- (470)
Class C -- (419)
Class N -- (3)
Class Y -- (119)
- --------------------------------------------------------------------------------
Beneficial Interest Transactions
Net increase (decrease) in net assets resulting
from beneficial interest transactions:
Class A 798,997 523,137
Class B 225,726 268,164
Class C 155,392 (88,170)
Class N 479,618 34,262
Class Y 118,741 199,771
- --------------------------------------------------------------------------------
Net Assets
Total increase (decrease) 2,358,285 (1,591,043)
- --------------------------------------------------------------------------------
Beginning of period 6,734,849 8,325,892
-----------------------------
End of period [including undistributed
(overdistributed) net investment income
of $21,920 and $(1,119), respectively] $9,093,134 $6,734,849
=============================
See accompanying Notes to Financial Statements.
16 | OPPENHEIMER TRINITY VALUE FUND
FINANCIAL HIGHLIGHTS
Class A Year Ended July 31, 2003 2002 2001 2000 1
- -------------------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $7.37 $10.15 $ 9.52 $10.00
- -------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .04 .03 .02 .05
Net realized and unrealized gain (loss) .69 (2.42) .61 (.50)
-----------------------------------------------
Total from investment operations .73 (2.39) .63 (.45)
- -------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- -- (.03)
Distributions from net realized gain -- (.39) -- --
Distributions in excess of net realized gain -- -- 2 -- --
-----------------------------------------------
Total dividends and/or distributions to shareholders -- (.39) -- (.03)
- -------------------------------------------------------------------------------------------------------
Net asset value, end of period $8.10 $ 7.37 $10.15 $ 9.52
==============================================
- -------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 3 9.91% (24.30)% 6.62% (4.50)%
- -------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $4,296 $3,203 $3,868 $3,798
- -------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $4,506 $3,683 $3,932 $2,802
- -------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 0.58% 0.36% 0.20% 0.52%
Expenses, gross 2.07% 1.78% 1.63% 1.53%
Expenses, net 1.95% 5,6,7 1.72% 5,7 1.63% 5 1.47% 8
- -------------------------------------------------------------------------------------------------------
Portfolio turnover rate 156% 133% 207% 285%
1. For the period from September 1, 1999 (commencement of operations) to July
31, 2000.
2. Less than $0.005 per share.
3. Assumes an investment on the business day before the first day of the fiscal
period (or commencement of operations), 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 that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Net of voluntary waiver of management fees.
7. Net of voluntary waiver of transfer agent fees.
8. Net of reduction to custodian expenses.
See accompanying Notes to Financial Statements.
17 | OPPENHEIMER TRINITY VALUE FUND
FINANCIAL HIGHLIGHTS CONTINUED
Class B Year Ended July 31, 2003 2002 2001 2000 1
- ----------------------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $7.18 $9.98 $9.45 $10.00
- ----------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.01) (.03) (.02) .01
Net realized and unrealized gain (loss) .67 (2.38) .55 (.53)
--------------------------------------------------
Total from investment operations .66 (2.41) .53 (.52)
- ----------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- -- (.03)
Distributions from net realized gain -- (.39) -- --
Distributions in excess of net realized gain -- -- 2 -- --
--------------------------------------------------
Total dividends and/or distributions to shareholders -- (.39) -- (.03)
- ----------------------------------------------------------------------------------------------------------
Net asset value, end of period $7.84 $7.18 $9.98 $ 9.45
==================================================
- ----------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 3 9.19% (24.93)% 5.61% (5.18)%
- ----------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
- ----------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $1,897 $1,584 $1,927 $643
Average net assets (in thousands) $2,151 $1,907 $1,329 $235
- ----------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss (0.20)% (0.42)% (0.52)% (0.36)%
Expenses, gross 3.18% 2.57% 2.57% 2.41%
Expenses, net 2.71% 5,6,7 2.51% 5,7 2.57% 5 2.35% 8
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 156% 133% 207% 285%
1. For the period from September 1, 1999 (commencement of operations) to July
31, 2000.
2. Less than $0.005 per share.
3. Assumes an investment on the business day before the first day of the fiscal
period (or commencement of operations), 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 that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Net of voluntary waiver of management fees.
7. Net of voluntary waiver of transfer agent fees.
8. Net of reduction to custodian expenses.
See accompanying Notes to Financial Statements.
18 | OPPENHEIMER TRINITY VALUE FUND
Class C Year Ended July 31, 2003 2002 2001 2000 1
- ------------------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $7.28 $10.11 $ 9.57 $10.00
- -------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment loss (.01) (.04) (.03) (.02)
Net realized and unrealized gain (loss) .67 (2.40) .57 (.41)
------------------------------------------------
Total from investment operations .66 (2.44) .54 (.43)
- ------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- -- -- 2
Distributions from net realized gain -- (.39) -- --
Distributions in excess of net realized gain -- -- 2 -- --
------------------------------------------------
Total dividends and/or
distributions to shareholders -- (.39) -- --
- ------------------------------------------------------------------------------------------------------
Net asset value, end of period $7.94 $ 7.28 $10.11 $ 9.57
=================================================
- -------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 3 9.07% (24.91)% 5.64% (4.27)%
- -------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $1,720 $1,453 $2,102 $851
- -------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $1,881 $1,698 $1,878 $260
- -------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment loss (0.24)% (0.40)% (0.44)% (0.36)%
Expenses, gross 2.94% 2.57% 2.56% 2.41%
Expenses, net 2.73% 5,6,7 2.51% 5,7 2.56% 5 2.35% 8
- -------------------------------------------------------------------------------------------------------
Portfolio turnover rate 156% 133% 207% 285%
1. For the period from September 1, 1999 (commencement of operations) to July
31, 2000.
2. Less than $0.005 per share.
3. Assumes an investment on the business day before the first day of the fiscal
period (or commencement of operations), 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 that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Net of voluntary waiver of management fees.
7. Net of voluntary waiver of transfer agent fees.
8. Net of reduction to custodian expenses.
See accompanying Notes to Financial Statements.
19 | OPPENHEIMER TRINITY VALUE FUND
FINANCIAL HIGHLIGHTS Continued
Class N Year Ended July 31, 2003 2002 2001 1
- --------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $7.33 $10.13 $10.05
- ----------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .01 .02 (.02)
Net realized and unrealized gain (loss) .70 (2.43) .10
--------------------------------------
Total from investment operations .71 (2.41) .08
- ----------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- --
Distributions from net realized gain -- (.39) --
Distributions in excess of net realized gain -- -- 2 --
--------------------------------------
Total dividends and/or distributions to shareholders -- (.39) --
- ----------------------------------------------------------------------------------------------
Net asset value, end of period $8.04 $ 7.33 $10.13
======================================
- ----------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 3 9.69% (24.55)% 0.80%
- ----------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $536 $29 $1
- ----------------------------------------------------------------------------------------------
Average net assets (in thousands) $181 $12 $1
- ----------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss) 0.08% (0.05)% (0.48)%
Expenses, gross 2.30% 2.10% 1.63%
Expenses, net 2.20% 5,6,7 2.04% 5,7 1.63% 5
- --------------------------------------------------------------------------------------------
Portfolio turnover rate 156% 133% 207%
1. For the period from March 1, 2001 (inception of offering) to July 31, 2001.
2. Less than $0.005 per share.
3. Assumes an investment on the business day before the first day of the fiscal
period (or inception of offering), 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 that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
4. Annualized for periods of less than one full year.
5. Reduction to custodian expenses less than 0.01%.
6. Net of voluntary waiver of management fees.
7. Net of voluntary waiver of transfer agent fees.
See accompanying Notes to Financial Statements.
20 | OPPENHEIMER TRINITY VALUE FUND
Class Y Year Ended July 31, 2003 2002 2001 2000 1
- ----------------------------------------------------------------------------------------------------------
Per Share Operating Data
Net asset value, beginning of period $7.42 $10.18 $ 9.53 $10.00
- ----------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .05 .05 (.01) .07
Net realized and unrealized gain (loss) .74 (2.42) .66 (.50)
-------------------------------------------------
Total from investment operations .79 (2.37) .65 (.43)
- ---------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- -- -- (.04)
Distributions from net realized gain -- (.39) -- --
Distributions in excess of net realized gain -- -- 2 -- --
------------------------------------------------
Total dividends and/or distributions to shareholders -- (.39) -- (.04)
- ---------------------------------------------------------------------------------------------------------
Net asset value, end of period $8.21 $ 7.42 $10.18 $ 9.53
==================================================
- ----------------------------------------------------------------------------------------------------------
Total Return, at Net Asset Value 3 10.65% (24.02)% 6.82% (4.33)%
- ----------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
Net assets, end of period (in thousands) $644 $466 $427 $1
- ----------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $504 $484 $119 $1
- ----------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 1.05% 0.78% 0.53% 0.62%
Expenses, gross 1.46% 1.78% 2.44% 5 1.42%
Expenses, net 1.41% 6,7 1.37% 6,8 1.43% 6 1.37% 9
- ----------------------------------------------------------------------------------------------------------
Portfolio turnover rate 156% 133% 207% 285%
1. For the period from September 1, 1999 (commencement of operations) to July
31, 2000.
2. Less than $0.005 per share.
3. Assumes an investment on the business day before the first day of the fiscal
period (or commencement of operations), 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 that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
4. Annualized for periods of less than one full year.
5. Added since July 31, 2001 to reflect expenses before reduction to custodian
expenses and voluntary waiver of transfer agent fees.
6. Reduction to custodian expenses less than 0.01%.
7. Net of voluntary waiver of management fees.
8. Net of voluntary waiver of transfer agent fees.
9. Net of reduction to custodian expenses.
See accompanying Notes to Financial Statements.
21 | OPPENHEIMER TRINITY VALUE FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
1. Significant Accounting Policies
Oppenheimer Trinity Value 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 long-term growth of capital. The
Fund's investment advisor is OppenheimerFunds, Inc. (the Manager). The Manager
has entered into a sub-advisory agreement with Trinity Investment Management
Corporation, a related party to the Manager..
The Fund offers Class A, Class B, Class C, Class N and Class Y 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. Class Y shares are sold to certain institutional investors without
either a front-end sales charge or a CDSC. 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. No such plan has been adopted for Class Y
shares. 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.
- --------------------------------------------------------------------------------
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 are valued. Securities traded on NASDAQ are valued based on the closing
price provided by NASDAQ prior to the time when the Fund's assets 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 closing bid and asked
prices, and if not, at the 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 using 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).
- --------------------------------------------------------------------------------
Joint Repurchase Agreements. Pursuant to an Exemptive Order issued by the
Securities and Exchange Commission, the Fund, along with other affiliated funds
advised by the Manager, may transfer uninvested cash balances into joint
trading accounts on a daily basis. Secured by U.S. government securities, these
balances are invested in one or more repurchase agreements. 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. In
22 | OPPENHEIMER TRINITY VALUE FUND
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 on a
daily basis 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 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.
The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years
and unrealized appreciation or depreciation of investment for federal income
tax purposes.
Net Unrealized
Undistributed Appreciation Based
Net Undistributed Accumulated on Cost of Securities
Investment Long-Term Loss for Federal Income
Income Gain Carryforward 1,2,3 Tax Purposes
- --------------------------------------------------------------------------------
$23,190 $-- $2,103,342 $365,248
1. As of July 31, 2003, the Fund had $1,280,584 of net capital loss
carryforwards available to offset future realized capital gains, if any, and
thereby reduce future taxable gain distributions. As of July 31, 2003, details
of the capital loss carryforwards were as follows:
Expiring
----------------------
2010 $ 275,923
2011 1,004,661
-----------
Total $1,280,584
===========
2. During the fiscal years ended July 31, 2003 and July 31, 2002, the Fund did
not utilize any capital loss carryforwards.
3. As of July 31, 2003, the Fund had $822,758 of post-October losses available
to offset future capital gains, if any. Such losses, if unutilized, will expire
in 2012.
The tax character of distributions paid during the years ended July 31, 2003
and July 31, 2002 was as follows:
Year Ended Year Ended
July 31, 2003 July 31, 2002
------------------------------------------------------
Distributions paid from:
Ordinary income $-- $272,232
Long-term capital gain -- 34,639
Distribution in excess of
net realized gain -- 1,919
--------------------------
Total $-- $308,790
==========================
23 | OPPENHEIMER TRINITY VALUE FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
1. Significant Accounting Policies Continued
The aggregate cost of investments and the composition of unrealized
appreciation and depreciation of investments for federal income tax purposes as
of July 31, 2003 are noted below. The primary difference between book and tax
appreciation or depreciation of investments, if applicable, is attributable to
the tax deferral of losses or tax realization of financial statement unrealized
gain or loss.
Federal Tax Cost $8,730,316
==========
Gross unrealized appreciation $ 675,985
Gross unrealized depreciation (310,737)
----------
Net unrealized appreciation $ 365,248
==========
- --------------------------------------------------------------------------------
Trustees' Compensation. The Fund has adopted an unfunded retirement plan for
the Fund's independent trustees. Benefits are based on years of service and
fees paid to each trustee during the years of service. During the year ended
July 31, 2003, the Fund's projected benefit obligations were increased by $191
and payments of $40 were made to retired trustees, resulting in an accumulated
liability of $1,271 as of July 31, 2003.
The Board of Trustees has adopted a deferred compensation plan for
independent trustees that enables trustees to elect to defer receipt of all or
a portion of the annual compensation they are entitled to receive from the
Fund. Under the plan, deferred amounts are treated as though equal dollar
amounts had been invested in shares of the Fund or are invested in other
selected Oppenheimer funds. Deferral of trustees' fees under the plan will not
affect the net assets of the Fund, and will not materially affect the Fund's
assets, liabilities or net investment income per share. Amounts will be
deferred until distributed in accordance to the Plan.
- --------------------------------------------------------------------------------
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 and capital gain distributions, if
any, are declared and paid annually.
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
Expense Offset Arrangement. The reduction of custodian fees represents earnings
on cash balances maintained by the Fund.
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
Other. The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make
24 | OPPENHEIMER TRINITY VALUE FUND
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of income and expenses during
the reporting period. Actual results could differ from those estimates.
- --------------------------------------------------------------------------------
2. Shares of Beneficial Interest
The Fund has authorized an unlimited number of no par value shares of
beneficial interest of each class. Transactions in shares of beneficial
interest were as follows:
Year Ended July 31, 2003 Year Ended July 31, 2002
Shares Amount Shares Amount
- -----------------------------------------------------------------------------------------------------
Class A
Sold 771,727 $ 5,508,001 410,692 $ 3,730,247
Dividends and/or
distributions reinvested -- -- 15,038 136,703
Redeemed (676,176) (4,709,004) (372,142) (3,343,813)
-------------------------------------------------------------
Net increase 95,551 $ 798,997 53,588 $ 523,137
=============================================================
- -----------------------------------------------------------------------------------------------------
Class B
Sold 328,499 $ 2,274,833 165,784 $ 1,473,693
Dividends and/or
distributions reinvested -- -- 7,752 69,074
Redeemed (306,950) (2,049,107) (146,138) (1,274,603)
-------------------------------------------------------------
Net increase 21,549 $ 225,726 27,398 $ 268,164
=============================================================
- -----------------------------------------------------------------------------------------------------
Class C
Sold 247,418 $ 1,734,082 199,337 $ 1,768,749
Dividends and/or
distributions reinvested -- -- 6,345 57,299
Redeemed (230,409) (1,578,690) (213,979) (1,914,218)
-------------------------------------------------------------
Net increase (decrease) 17,009 $ 155,392 (8,297) $ (88,170)
=============================================================
- -----------------------------------------------------------------------------------------------------
Class N
Sold 66,368 $ 503,565 4,004 $ 35,798
Dividends and/or
distributions reinvested -- -- 13 123
Redeemed (3,559) (23,947) (192) (1,659)
-------------------------------------------------------------
Net increase 62,809 $ 479,618 3,825 $ 34,262
=============================================================
- -----------------------------------------------------------------------------------------------------
Class Y
Sold 28,121 $ 207,674 28,239 $ 258,879
Dividends and/or
distributions reinvested -- -- 2,070 18,902
Redeemed (12,420) (88,933) (9,491) (78,010)
-------------------------------------------------------------
Net increase 15,701 $ 118,741 20,818 $ 199,771
=============================================================
25 | OPPENHEIMER TRINITY VALUE FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
3. Purchases and Sales of Securities
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended July 31, 2003, were $15,645,666
and $13,916,563, respectively.
- --------------------------------------------------------------------------------
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 0.75% of the first $200 million of average annual net assets of
the Fund, 0.72% of the next $200 million, 0.69% of the next $200 million, 0.66%
of the next $200 million, and 0.60% of average annual net assets in excess of
$800 million. Effective January 1, 2003, the Manager voluntarily agreed to waive
its advisory fee at an annual rate equal to 0.10% of each class's average daily
net assets until the Fund's trailing one-year performance at the end of the
preceding quarter is in or below the fifth quintile of the Fund's Lipper peer
group (i.e., multi-cap value funds). When the Fund's performance meets the
preceding condition, the Manager will voluntarily waive its advisory fee at an
annual rate equal to 0.05% of each class's average daily net assets while the
Fund's trailing one-year performance at the end of the preceding quarter is in
the fourth quintile of the Fund's Lipper peer group. The foregoing advisory fee
waiver automatically terminates when the Fund's trailing one-year performance at
the end of the preceding quarter is in the third quintile of the Fund's Lipper
peer group. As a result of this agreement the Fund was reimbursed $2,728 for the
year ended July 31, 2003. The foregoing waiver may be amended or withdrawn by
the Manager at any time.
- --------------------------------------------------------------------------------
Sub-Advisor Fees. The Manager pays Trinity Investment Management Corporation
(the Sub-Advisor) based on the fee schedule set forth in the Prospectus. For the
year ended July 31, 2003, the Manager paid $22,668 to the Sub-Advisor for
services to the Fund.
- --------------------------------------------------------------------------------
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 per account fee. For the year ended July 31, 2003, the Fund paid $30,131
to OFS for services to the Fund. Additionally, Class Y shares are subject to
minimum fees of $5,000 for assets of less than $10 million and $10,000 for
assets of $10 million or more. The Class Y shares are subject to the minimum
fees in the event that the per account fee does not equal or exceed the
applicable minimum fees. OFS may voluntarily waive the minimum fees. OFS has
voluntarily agreed to limit transfer and shareholder servicing agent fees up to
an annual rate of 0.35% of average annual net assets for all classes. This
undertaking may be amended or withdrawn at any time.
- --------------------------------------------------------------------------------
Distribution and Service Plan (12b-1) Fees. Under its General Distributor's
Agreement with the Manager, OppenheimerFunds Distributor, Inc. (the Distributor)
acts as the
26 | OPPENHEIMER TRINITY VALUE FUND
Fund's principal underwriter in the continuous public offering of the different
classes of shares of the 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
Year Ended Shares Distributor Distributor 1 Distributor 1 Distributor 1 Distributor 1
- ---------------------------------------------------------------------------------------------------------------------
July 31, 2003 $26,137 $15,330 $4,012 $16,178 $40,428 $9,738
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 Contingent Contingent Contingent
Deferred Deferred Deferred Deferred
Sales Charges Sales Charges Sales Charges Sales Charges
Retained by Retained by Retained by Retained by
Year Ended Distributor Distributor Distributor Distributor
- -------------------------------------------------------------------------------
July 31, 2003 $-- $12,865 $238 $206
- --------------------------------------------------------------------------------
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 year ended July 31, 2003, expense under the
Class A Plan totaled $9,834, all of which were paid by the Distributor to
recipients, which included $13 retained by the Distributor and $1,272 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 year ended July 31, 2003,
were as follows:
Distributor's
Distributor's Aggregate
Aggregate Unreimbursed
Unreimbursed Expenses as %
Total Payments Amount Retained Expenses of Net Assets
Under Plan by Distributor Under Plan of Class
- ------------------------------------------------------------------------------
Class B Plan $21,501 $17,321 $34,408 1.81%
Class C Plan 18,805 7,303 26,800 1.56
Class N Plan 898 814 2,873 0.54
27 | OPPENHEIMER TRINITY VALUE FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
5. Fund Reorganization
On September 12, 2003, Shareholders of Oppenheimer Trinity Value Fund approved a
fund reorganization, whereby Shareholders received shares of Oppenheimer Value
Fund. The reorganization occurred on September 18, 2003.
28 | OPPENHEIMER TRINITY VALUE FUND
INDEPENDENT AUDITORS' REPORT
- --------------------------------------------------------------------------------
The Board of Trustees and Shareholders of
Oppenheimer Trinity Value Fund:
We have audited the accompanying statement of assets and liabilities of
Oppenheimer Trinity Value Fund, including the statement of investments, as of
July 31, 2003, and the related statement of operations for the year then ended,
the statements of changes in net assets for each of the two years in the period
then ended, and the financial highlights for each of the three years in the
period then ended, and the period from September 1, 1999 (commencement of
operations) to July 31, 2000. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. 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 July 31, 2003, by
correspondence with the custodian and brokers or by other appropriate auditing
procedures where replies from brokers were not received. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer Trinity Value Fund as of July 31, 2003, 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 three years in the period then ended, and the period from September 1,
1999 (commencement of operations) to July 31, 2000, in conformity with
accounting principles generally accepted in the United States of America.
KPMG LLP
Denver, Colorado
August 21, 2003
29 | OPPENHEIMER TRINITY VALUE FUND
FEDERAL INCOME TAX INFORMATION Unaudited
- --------------------------------------------------------------------------------
In early 2004, if applicable, shareholders of record will receive information
regarding all dividends and distributions paid to them by the Fund during
calendar year 2003. Regulations of the U.S. Treasury Department require the
Fund to report this information to the Internal Revenue Service.
Dividends paid by the Fund during the fiscal year ended July 31, 2003 which
are not designated as capital gain distribution should be multiplied by 100% to
arrive at the amount eligible for the corporate dividend received deduction.
A portion of the dividends paid by the Fund during the fiscal year ended
July 31, 2003 which are not designated as capital gain distributions are
eligible for lower individual income tax rates to the extent that the Fund has
received qualified dividend income as stipulated by recent tax legislation.
$120,500 of the Fund's fiscal year taxable income is eligible for the lower
individual income tax rates. In early 2004, shareholders of record will receive
information regarding the percentage of distributions that are eligible for
lower individual income tax rates.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because
of the complexity of the federal regulations which may affect your individual
tax return and the many variations in state and local tax regulations, we
recommend that you consult your tax advisor for specific guidance.
PORTFOLIO PROXY VOTING
POLICIES AND PROCEDURES UNAUDITED
- --------------------------------------------------------------------------------
The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which
the Fund votes proxies relating to securities ("portfolio proxies") held by the
Fund. A description of the Fund's Portfolio Proxy Voting Policies and
Procedures is available (i) without charge, upon request, by calling the Fund
toll-free at 1.800.225.5677, (ii) on the Fund's website at
www.oppenheimerfunds.com, and (iii) on the SEC's website at www.sec.gov. In
addition, the Fund will be required to file new Form N-PX, with its complete
proxy voting record for the 12 months ended June 30th, no later than August
31st of each year. The first such filing is due no later than August 31, 2004,
for the twelve months ended June 30, 2004. Once filed, the Fund's Form N-PX
filing will be available (i) without charge, upon request, by calling the Fund
toll-free at 1.800.225.5677, and (ii) on the SEC's website at www.sec.gov.
30 | OPPENHEIMER TRINITY VALUE FUND
TRUSTEES AND OFFICERS Unaudited
Name, Position(s) Held with Fund, Principal Occupation(s) During Past 5 Years;
Length of Service, Age Other Trusteeships/Directorships Held by
Trustee; Number of Portfolios in Fund
Complex Currently Overseen by Trustee
INDEPENDENT TRUSTEES The address of each Trustee in the chart
below is 6803 S. Tucson Way, Centennial, CO
80112-3924. Each Trustee serves for an
indefinite term, until his or her
resignation, retirement, death or removal.
Clayton K. Yeutter, Of Counsel (since 1993), Hogan & Hartson (a
Chairman of the Board of Trustees law firm). Other directorships: Weyerhaeuser
(since 2003); Trustee (since Corp. (since 1999) and Danielson Holding
1999) Age: 72 Corp. (since 2002); formerly a director of
Caterpillar, Inc. (1993-December 2002).
Oversees 29 portfolios in the
OppenheimerFunds complex.
Robert G. Galli, Trustee A trustee or director of other Oppenheimer
(since 1999) Age: 69 funds. Formerly Trustee (May 2000-2002) of
Research Foundation of AIMR (investment
research, non-profit) and Vice Chairman
(October 1995-December 1997) of
OppenheimerFunds, Inc. (the Manager).
Oversees 39 portfolios in the
OppenheimerFunds complex.
Phillip A. Griffiths, Trustee A director (since 1991) of the Institute for
(since 1999) Age: 64 Advanced Study, Princeton, N.J., a director
(since 2001) of GSI Lumonics, a trustee
(since 1983) of Woodward Academy, a Senior
Advisor (since 2001) of The Andrew W. Mellon
Foundation. A member of: the National
Academy of Sciences (since 1979), American
Academy of Arts and Sciences (since 1995),
American Philosophical Society (since 1996)
and Council on Foreign Relations (since
2002). Formerly a director of Bankers Trust
New York Corporation (1994-1999). Oversees
29 portfolios in the OppenheimerFunds
complex.
Joel W. Motley, Trustee Director (since 2002) Columbia Equity
(since 2002) Age: 53 Financial Corp. (privately-held financial
adviser); Managing Director (since 2002)
Carmona Motley, Inc. (privately-held
financial adviser); Formerly he held the
following positions: Managing Director
(January 1998-December 2001), Carmona Motley
Hoffman Inc. (privately-held financial
adviser); Managing Director (January
1992-December 1997), Carmona Motley & Co.
(privately-held financial adviser). Oversees
29 portfolios in the OppenheimerFunds
complex.
Kenneth A. Randall, Trustee A director of Dominion Resources, Inc.
(since 1999) Age: 76 (electric utility holding company) and Prime
Retail, Inc. (real estate investment trust);
formerly a director of Dominion Energy, Inc.
(electric power and oil & gas producer),
President and Chief Executive Officer of The
Conference Board, Inc. (international
economic and business research) and a
director of Lumbermens Mutual Casualty
Company, American Motorists Insurance
Company and American Manufacturers Mutual
Insurance Company. Oversees 29 portfolios in
the OppenheimerFunds complex.
Edward V. Regan, Trustee President, Baruch College, CUNY; a director
(since 1999) Age: 73 of RBAsset (real estate manager); a director
of OffitBank; formerly Trustee, Financial
Accounting Foundation (FASB and GASB),
Senior Fellow of Jerome Levy Economics
Institute, Bard College, Chairman of
Municipal Assistance Corporation for the
City of New York, New York State Comptroller
and Trustee of New York State and Local
Retirement Fund. Oversees 29 investment
companies in the OppenheimerFunds complex.
Russell S. Reynolds, Jr., Chairman (since 1993) of The Directorship
Trustee (since 1999) Age: 71 Search Group, Inc. (corporate governance
consulting and executive recruiting); a life
trustee of International House (non-profit
educational organization), and a trustee
(since 1996) of the Greenwich Historical
Society. Oversees 31 portfolios in the
OppenheimerFunds complex.
31 | OPPENHEIMER TRINITY VALUE FUND
TRUSTEES AND OFFICERS Unaudited / Continued
Donald W. Spiro, Vice Chairman Emeritus (since January 1991) of
Chairman of the Board of the Manager. Formerly a director (January
Trustees, Trustee (since 1969-August 1999) of the Manager. Oversees
1999) Age: 77 29 portfolios in the OppenheimerFunds
complex.
-------------------------------------------------------------------------------
INTERESTED TRUSTEE AND The address of Mr. Murphy in the chart below
OFFICER is 498 Seventh Avenue, New York, NY 10018.
Mr. Murphy serves for an indefinite term,
until his resignation, death or removal.
John V. Murphy, President and Chairman, Chief Executive Officer and
Trustee, Trustee (since 2001) director (since June 2001) and President
Age: 54 (since September 2000) of the Manager;
President and a director or trustee of other
Oppenheimer funds; President and a director
(since July 2001) of Oppenheimer Acquisition
Corp. (the Manager's parent holding company)
and of Oppenheimer Partnership Holdings,
Inc. (a 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 73 portfolios in the
OppenheimerFunds complex.
-------------------------------------------------------------------------------
OFFICERS The address of the Officers in the chart
below is as follows: for Mr. 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.
Brian W. Wixted, Senior Vice President and Treasurer (since
Treasurer (since 1999) March 1999) of the Manager; Treasurer (since
Age: 43 March 1999) of HarbourView Asset Management
Corporation, Shareholder Services, Inc.,
Oppenheimer Real Asset Management
Corporation, Shareholder Financial Services,
Inc., Oppenheimer Partnership Holdings,
Inc., OFI Private Investments, Inc. (since
March 2000), OppenheimerFunds International
Ltd. and OppenheimerFunds plc (offshore fund
management subsidiary of the Manager) (since
May 2000) and OFI Institutional Asset
Management, Inc. (since November 2000)
(offshore fund management subsidiaries of
the Manager); Treasurer and Chief Financial
Officer (since May 2000) of Oppenheimer
Trust
32 | OPPENHEIMER TRINITY VALUE FUND
Brian W. Wixted, Company (a trust company subsidiary of the
Continued 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),
Bankers Trust Company-Mutual Fund Services
Division. An officer of 89 portfolios in the
OppenheimerFunds complex.
Robert G. Zack, Senior Vice President (since May 1985) and
Secretary (since 2001) General Counsel (since February 2002) of the
Age: 54 Manager; General Counsel and a director
(since November 2001) of OppenheimerFunds
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 OppenheimerFunds plc (October
1997-November 2001). An officer of 89
portfolios in the OppenheimerFunds complex.
The Fund's Statement of Additional Information contains additional information
about the Fund's Trustee's and is available without charge upon request.
33 | OPPENHEIMER TRINITY VALUE FUND
ITEM 2. CODE OF ETHICS
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The Board of Trustees of the Fund has determined that Edward V. Regan,
the Chairman of the Board's Audit Committee, possesses the technical attributes
identified in Instruction 2(b) of Item 3 to Form N-CSR to qualify as an "audit
committee financial expert," and has designated Mr. Regan as the Audit
Committee's financial expert. Mr. Regan is an "independent" Trustee pursuant to
paragraph (a)(2) of Item 3 to Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES - NOT REQUIRED
ITEM 5. NOT APPLICABLE
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 July 31, 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.
(A) EXHIBIT ATTACHED HERETO. (ATTACH CODE OF ETHICS AS EXHIBIT)
(B) EXHIBITS ATTACHED HERETO. (ATTACH CERTIFICATIONS AS EXHIBITS)