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 811-05871
CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
(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.
Two World Financial Center, New York, New York 10281-1008
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(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
--------------
Date of fiscal year end: JUNE 30
-------
Date of reporting period: JULY 1, 2003 - DECEMBER 31, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
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STATEMENT OF INVESTMENTS December 31, 2003 / Unaudited
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PRINCIPAL VALUE
AMOUNT SEE NOTE 1
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SHORT-TERM TAX-EXEMPT OBLIGATIONS--99.2%
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CALIFORNIA--99.2%
CA Department of Water Resources Power Supply RB, Series C-4, 1.25% 1 $ 4,200,000 $ 4,200,000
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CA Department of Water Resources Power Supply RRB,
Central Valley Project, MERLOT Series 2003 B32, FGIC Insured, 1.15% 1 1,995,000 1,995,000
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CA EDLFA RN, Stanford University, 0.87%, 2/12/04 4,000,000 4,000,000
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CA HFFAU RB, MSTFC Series 1998 26, FSA Insured, 1.23% 1 6,000,000 6,000,000
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CA Infrastructure & ED Bank RRB, J. Paul Getty Trust, Series A, 1%, 5/13/04 2 6,000,000 6,000,000
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CA Infrastructure & ED Bank RRB, J. Paul Getty Trust, Series D, 1%, 5/13/04 2 4,000,000 4,000,000
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CA Infrastructure & ED Bank RRB, Salvation Army Western Territory,
Series 2001, 1.08%, 1/28/04 7,500,000 7,500,000
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CA PCFAU SWD RB, Burrtec Waste Industries, Series A, 1.20% 1 2,500,000 2,500,000
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CA PCFAU SWD RB, Cedar Avenue Recycling Project-A, 1.20% 1 3,000,000 3,000,000
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CA SCDAU MH RB, Greentree Sr. Apts. Project-P, 1.26% 1 6,600,000 6,600,000
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CA SCDAU RB, IDV-Fibrebond, Inc., 1.35% 1 520,000 520,000
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Huntington Park, CA RA MH RB, Casa Rita Apts., Series A, 1.26% 1 800,000 800,000
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Irwindale, CA Community RA TXAL Bonds, City IDV Project 2002,
1.25%, 7/15/04 455,000 455,387
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Lodi, CA EU REF COP, Series A, MBIA Insured, 1.03% 1 1,600,000 1,600,000
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Los Angeles Cnty., CA MH Mtg. RB, Valencia Housing Project, Series C, 1.15% 1 2,500,000 2,500,000
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Los Angeles Cnty., CA MTAU Sales Tax RB, SGMSTR Series 1996 SG54,
AMBAC Insured, 1.25% 1 1,000,000 1,000,000
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Los Angeles Cnty., CA MTAU Sales Tax RRB, Second Sr. Series A,
MBIA Insured, 1.20% 1 500,000 500,000
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Los Angeles, CA Airport RB, SGMSTR Series 1996 SG61, 1.28% 1 3,000,000 3,000,000
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Los Angeles, CA Convention & Exhibit Center Authority Lease RRB,
Subseries B-2, AMBAC Insured, 0.97%, 6/16/04 2 5,000,000 5,000,000
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Los Angeles, CA USD GOB, AAMC Series 1999-7, MBIA Insured, 1.14% 1,3 6,000,000 6,000,000
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Los Angeles, CA Wastewater System GOB, AAMC Series 1998-25,
FGIC Insured, 1.16% 1 2,000,000 2,000,000
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Madera, CA PFAU Lease RRB, Madera Municipal Golf Course
Refinancing Project, 1.20% 1 435,000 435,000
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Mount San Antonio, CA Community College District GOUN, Series A,
FGIC Insured, 3.25%, 5/1/04 1,000,000 1,007,691
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Northern CA Power Agency RRB, Hydroelectric Project 1-A,
MBIA Insured, 1.11% 1 1,100,000 1,100,000
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Oceanside, CA MH RRB, Lakeridge Apts. Project, 1.15% 1 3,300,000 3,300,000
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Orange Cnty., CA Apt. Development RB, Niguel Summit 2, Series B, 1.15% 1 3,461,000 3,461,000
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Orange Cnty., CA LTA Sales Tax RN, 0.89%, 2/10/04 5,400,000 5,400,000
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Rancho Mirage, CA Joint Powers FA REF COP, Eisenhower Medical
enter, Series B, MBIA Insured, 1.11% 1 6,200,000 6,200,000
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Sacramento Cnty., CA MH HAU RB, Shadowood Apts. Project-Issue A, 1.25% 1 6,000,000 6,000,000
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San Bernardino Cnty., CA MH HAU RRB, Montclair Heritage-A, 1.24% 1 4,620,000 4,620,000
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San Bernardino Cnty., CA MH RRB, Somerset Apts.-A, 1.25% 1 2,595,000 2,595,000
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San Diego, CA UPD Sub. Airport RN, Lindbergh Field, Series B, 0.90%, 2/2/04 9,400,000 9,400,000
5 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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STATEMENT OF INVESTMENTS Unaudited / Continued
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PRINCIPAL VALUE
AMOUNT SEE NOTE 1
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CALIFORNIA Continued
San Diego, CA Water Utility Fund Net System GOB, AAMC Series 1998-10,
FGIC Insured, 1.16% 1,3 $4,800,000 $ 4,800,000
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San Francisco, CA City & Cnty. GOB, 2%, 6/15/04 615,000 617,581
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San Francisco, CA City & Cnty. PUC Clean Water RRB,
MERLOT Series B20, MBIA Insured, 1.15% 1 7,000,000 7,000,000
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San Francisco, CA City & Cnty. RA MF RB, Mission Creek Senior
Facility, 1.33% 1 2,000,000 2,000,000
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Southern CA PPAU RRB, Palo Verde Project, Series B, AMBAC
Insured, 1.03% 1 3,800,000 3,800,000
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Stockton, CA CFD No. 99-02 SPTX Bonds, Arch Road East, 1.22% 1 2,835,000 2,835,000
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University of California Regents RB, 0.87%, 1/21/04 7,500,000 7,500,000
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University of California Regents RB, 1.03%, 1/7/04 1,500,000 1,499,967
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TOTAL INVESTMENTS, AT VALUE (COST $142,741,626) 99.2% 142,741,626
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OTHER ASSETS NET OF LIABILITIES 0.8 1,188,108
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NET ASSETS 100.0% $143,929,734
===========================
FOOTNOTES TO STATEMENT OF INVESTMENTS
To simplify the listings of securities, abbreviations are used per the table
below:
AAMC ABN AMRO Munitops Certificates
CFD Community Facilities District
COP Certificates of Participation
ED Economic Development
EDLFA Educational Facilities Authority
EU Electric Utilities
FA Facilities Authority
GOB General Obligation Bonds
GOUN General Obligation Unlimited Nts.
HAU Housing Authority
HFFAU Health Facilities Finance Authority
IDV Industrial Development
LTA Local Transportation Authority/Agency
MERLOT Municipal Exempt Receipts Liquidity Option Tender
MH Multifamily Housing
MSTFC Morgan Stanley & Co., Inc. Trust Floater Certificates
MTAU Metropolitan Transportation Authority
PCFAU Pollution Control Finance Authority
PFAU Public Finance Authority
PPAU Public Power Authority
PUC Public Utilities Commission
RA Redevelopment Agency
RB Revenue Bonds
REF Refunding
RN Revenue Nts.
RRB Revenue Refunding Bonds
SCDAU Statewide Communities Development Authority
SGMSTR Societe Generale, NY Branch Municipal Security Trust Receipts
SPTX Special Tax
SWD Solid Waste Disposal
TXAL Tax Allocation
UPD Unified Port District
USD Unified School District
1. Floating or variable rate obligation maturing in more than one year. The
interest rate, which is based on specific, or an index of, market interest
rates, is subject to change periodically and is the effective rate on December
31, 2003. This instrument has a demand feature which allows, on up to 30 days'
notice, the recovery of principal at any time, or at specified intervals not
exceeding one year.
2. Put obligation redeemable at full principal value on the date reported.
3. 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 $10,800,000 or 7.50% of the Trust's net
assets as of December 31, 2003.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
6 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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STATEMENT OF ASSETS AND LIABILITIES Unaudited
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December 31, 2003
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ASSETS
Investments, at value (cost $142,741,626)--see accompanying statement $ 142,741,626
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Cash 426,369
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Receivables and other assets:
Shares of beneficial interest sold 1,368,549
Interest 302,439
Other 14,319
--------------
Total assets 144,853,302
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LIABILITIES
Payables and other liabilities:
Shares of beneficial interest redeemed 818,618
Service plan fees 74,410
Shareholder reports 5,045
Transfer and shareholder servicing agent fees 4,330
Trustees' compensation 1,262
Other 19,903
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Total liabilities 923,568
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NET ASSETS $143,929,734
==============
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COMPOSITION OF NET ASSETS
Paid-in capital $143,942,778
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Accumulated net realized loss on investments (13,044)
--------------
NET ASSETS--applicable to 143,924,055 shares of beneficial interest outstanding $143,929,734
==============
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NET ASSET VALUE, REDEMPTION PRICE PER SHARE AND OFFERING PRICE PER SHARE $1.00
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
7 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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STATEMENT OF OPERATIONS Unaudited
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For the Six Months Ended December 31, 2003
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INVESTMENT INCOME
Interest $ 723,998
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EXPENSES
Management fees 379,013
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Service plan fees 150,908
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Transfer and shareholder servicing agent fees 25,413
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Shareholder reports 5,406
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Trustees' compensation 3,442
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Custodian fees and expenses 3,279
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Other 19,458
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Total expenses 586,919
Less reduction to custodian expenses (1,374)
Less voluntary reimbursement of expenses (1,473)
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Net expenses 584,072
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NET INVESTMENT INCOME 139,926
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NET REALIZED LOSS ON INVESTMENTS (13,044)
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NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 126,882
===========
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
8 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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STATEMENTS OF CHANGES IN NET ASSETS
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SIX MONTHS YEAR
ENDED ENDED
DECEMBER 31, 2003 JUNE 30,
(UNAUDITED) 2003
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OPERATIONS
Net investment income $ 139,926 $ 805,721
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Net realized gain (loss) (13,044) 2,327
------------------------------
Net increase in net assets resulting from operations 126,882 808,048
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DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income (139,926) (805,721)
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BENEFICIAL INTEREST TRANSACTIONS
Net decrease in net assets resulting from beneficial interest transactions (8,913,103) (1,799,511)
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NET ASSETS
Total decrease (8,926,147) (1,797,184)
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Beginning of period 152,855,881 154,653,065
------------------------------
End of period $ 143,929,734 $ 152,855,881
==============================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS
9 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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FINANCIAL HIGHLIGHTS
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SIX MONTHS YEAR
ENDED ENDED
DECEMBER 31, 2003 JUNE 30,
(UNAUDITED) 2003 2002 2001 2000 1999
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PER SHARE OPERATING DATA
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
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Income from investment operations--net
investment income and net realized gain -- 1 .01 .01 .03 .03 .02
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Dividends and/or distributions
to shareholders:
Dividends from net investment income -- 1 (.01) (.01) (.03) (.03) (.02)
Distributions from net realized gain -- -- -- 1 -- -- --
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Total dividends and/or distributions
to shareholders -- (.01) (.01) (.03) (.03) (.02)
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Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
=============================================================
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TOTAL RETURN 2 0.10% 0.52% 0.89% 2.74% 2.63% 2.41%
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RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $143,930 $152,856 $154,653 $157,316 $162,261 $155,839
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Average net assets (in thousands) $150,325 $156,348 $164,278 $166,654 $160,351 $168,272
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Ratios to average net assets: 3
Net investment income 0.18% 0.52% 0.89% 2.72% 2.57% 2.38%
Total expenses 0.77% 0.76% 0.77% 0.84% 0.83% 0.80%
Expenses after expense reimbursement
or fee waiver and reduction to
custodian expenses N/A 4,5 N/A 4,5 N/A 4,5 0.81% 0.81% 0.78%
<FN>
1. Less than $0.005 per share.
2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends reinvested in additional shares on the reinvestment
date, and redemption at the net asset value calculated on the last business day
of the fiscal period. Total returns are not annualized for periods less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Trust distributions or the redemption of Trust shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
5. Voluntary reimbursement of expenses less than 0.01%.
</FN>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
10 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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NOTES TO FINANCIAL STATEMENTS Unaudited
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1. SIGNIFICANT ACCOUNTING POLICIES
Centennial California Tax Exempt Trust (the Trust) is registered under the
Investment Company Act of 1940, as amended, as a non-diversified, open-end
management investment company. The Trust's investment objective is to seek the
maximum current interest income exempt from federal and California personal
income taxes for individual investors as is consistent with the preservation of
capital. The Trust's investment advisor is Centennial Asset Management
Corporation (the Manager), a subsidiary of OppenheimerFunds, Inc. (OFI).
The following is a summary of significant accounting policies consistently
followed by the Trust.
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SECURITIES VALUATION. Portfolio securities are valued on the basis of amortized
cost, which approximates market value.
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SECURITY CREDIT RISK. There are certain risks arising from geographic
concentration in any State. Certain revenue or tax related events in a state
may impair the ability of certain issuers of municipal securities to pay
principal and interest on their obligations.
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FEDERAL TAXES. The Trust 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.
As of December 31, 2003, the Trust had available for federal income tax
purposes an estimated unused capital loss carryforward of $13,044. This
estimated capital loss carryforward represents carryforward as of the end of
the last fiscal year, increased for losses deferred under tax accounting rules
to the current fiscal year and is increased or decreased by capital losses or
gains realized in the first six months of the current fiscal year. During the
six months ended December 31, 2003 and the year ended June 30, 2003, the Trust
used $0 and $0, respectively, of carryforward to offset capital gains realized.
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TRUSTEES' COMPENSATION. 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 Trust. Under the plan, deferred amounts are treated as
though equal dollar amounts had been invested in shares of the Trust or are
invested in other Oppenheimer funds selected by the Trustee. Deferral of
trustees' fees under the plan will not affect the net assets of the Trust, and
will not materially affect the Trust's assets, liabilities or net investment
income per share. Amounts will be deferred until distributed in accordance to
the Plan.
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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 daily and paid monthly. Capital gain distributions, if any, are
declared and paid annually.
11 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
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1. SIGNIFICANT ACCOUNTING POLICIES Continued
EXPENSE OFFSET ARRANGEMENT. The reduction of custodian fees, if applicable,
represents earnings on cash balances maintained by the Trust.
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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.
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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.
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2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
SIX MONTHS ENDED DECEMBER 31, 2003 YEAR ENDED JUNE 30, 2003
SHARES AMOUNT SHARES AMOUNT
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Sold 209,586,577 $209,586,577 450,261,068 $450,261,068
Dividends and/or
distributions reinvested 149,663 149,663 803,029 803,029
Redeemed (218,649,343) (218,649,343) (452,863,608) (452,863,608)
----------------------------------------------------------
Net decrease (8,913,103) $ (8,913,103) (1,799,511) $ (1,799,511)
==========================================================
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3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
MANAGEMENT FEES. Management fees paid to the Manager were in accordance with
the investment advisory agreement with the Trust which provides for a fee at an
annual rate of 0.50% of the first $250 million of the net assets, 0.475% of the
next $250 million of net assets, 0.45% of the next $250 million of net assets,
0.425% of the next $250 million of net assets and 0.40% of net assets in excess
of $1 billion. The Manager has voluntarily undertaken to assume any expenses of
the Trust in any fiscal year they exceed 0.80% of the Trust's average annual
net assets. Effective July 7, 2003, the Manager has voluntarily undertaken to
waive receipt of its management fees to the extent necessary so that the Trust
may seek to maintain a positive yield. The Manager reserves the right to amend
or terminate either voluntary expense assumption at any time.
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TRANSFER AGENT FEES. Shareholder Services, Inc. (SSI) acts as the transfer and
shareholder servicing agent for the Trust and for other registered investment
companies. The Trust pays SSI a per account fee. For the six months ended
December 31, 2003, the Trust paid $25,108 to SSI for services to the Trust.
SSI has voluntarily agreed to limit transfer and shareholder servicing agent
fees up to an annual rate of 0.35% of average net assets of the Trust. This
undertaking may be amended or withdrawn at any time.
12 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
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SERVICE PLAN (12B-1) FEES. The Trust has adopted a service plan. It reimburses
Centennial Asset Management Corporation, the Distributor, for a portion of its
costs incurred for services provided to accounts that hold shares of the Trust.
Reimbursement is made quarterly at an annual rate up to 0.20% of the average
annual net assets of the Trust. Fees incurred by the Trust under the plan are
detailed in the Statement of Operations.
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PORTFOLIO PROXY VOTING
POLICIES AND PROCEDURES Unaudited
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- --------------------------------------------------------------------------------
The Trust has adopted Portfolio Proxy Voting Policies and Procedures under
which the Trust votes proxies relating to securities ("portfolio proxies") held
by the Trust. A description of the Trust's Portfolio Proxy Voting Policies and
Procedures is available (i) without charge, upon request, by calling the Trust
toll-free at 1.800.225.5677, (ii) on the Trust's website at
www.oppenheimerfunds.com, and (iii) on the SEC's website at www.sec.gov. In
addition, the Trust 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 Trust's Form N-PX
filing will be available (i) without charge, upon request, by calling the Trust
toll-free at 1.800.225.5677, and (ii) on the SEC's website at www.sec.gov.
13 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
ITEM 2. CODE OF ETHICS
The registrant has adopted a code of ethics that applies to the
registrant's principal executive officer, principal financial officer, principal
accounting officer or controller or persons performing similar functions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT
The Board of Trustees of the Trust has determined that Edward L.
Cameron, the Chairman of the Board's Audit Committee, and George C. Bowen, a
member of the Board's Audit Committee, possess the technical attributes
identified in Instruction 2(b) of Item 3 to Form N-CSR to qualify as "audit
committee financial experts," and has designated Messrs. Cameron and Bowen as
the Audit Committee's financial experts. Messrs. Cameron and Bowen are
"independent" Trustees pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Not applicable to semiannual reports.
ITEM 5. NOT APPLICABLE
ITEM 6. RESERVED
ITEM 7. NOT APPLICABLE
ITEM 8. NOT APPLICABLE
Item 9. Submission of Matters to a Vote of Security Holders
Not applicable for fiscal periods ending December 31, 2003.
ITEM 10. 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 December 31, 2003, registrant's
principal executive officer and principal financial officer found
registrant's disclosure controls and procedures to provide reasonable
assurances 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 over financial reporting that occurred during the registrant's
last fiscal half-year that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS.
(A) EXHIBIT ATTACHED HERETO. (ATTACH CODE OF ETHICS AS EXHIBIT)
(B) EXHIBITS ATTACHED HERETO. (ATTACH CERTIFICATIONS AS EXHIBITS)