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 811-3346
Oppenheimer 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.
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: October 31
Date of reporting period: November 1, 2003 - April 30, 2004
Item 1. Reports to Stockholders.
STATEMENT OF INVESTMENTS April 30, 2004 / Unaudited
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MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------
COMMON STOCKS--96.3%
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CONSUMER DISCRETIONARY--11.2%
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HOTELS, RESTAURANTS & LEISURE--2.0%
McDonald's Corp. 339,900 $ 9,255,477
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MEDIA--9.2%
Liberty Media
Corp., Cl. A 1 1,973,800 21,593,372
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News Corp. Ltd.
(The), Sponsored
ADR 9,700 354,632
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News Corp. Ltd.
(The), Sponsored
ADR, Preference 15,700 529,875
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UnitedGlobalCom,
Inc., Cl. A 1 2,670,892 19,978,272
--------------
42,456,151
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SPECIALTY RETAIL--0.0%
Gap, Inc. (The) 6,800 149,668
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CONSUMER STAPLES--7.1%
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FOOD & STAPLES RETAILING--2.1%
Costco Wholesale
Corp. 1 257,400 9,639,630
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TOBACCO--5.0%
Altria Group, Inc. 414,500 22,955,010
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ENERGY--7.8%
- --------------------------------------------------------------------------------
ENERGY EQUIPMENT & SERVICES--1.0%
Halliburton Co. 156,100 4,651,780
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OIL & GAS--6.8%
BP plc, ADR 485,200 25,667,080
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LUKOIL, Sponsored
ADR 31,400 3,422,600
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YUKOS, ADR 56,300 2,527,985
--------------
31,617,665
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FINANCIALS--26.2%
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COMMERCIAL BANKS--9.6%
Bank of America
Corp. 299,289 24,089,772
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SouthTrust Corp. 208,400 6,477,072
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Wells Fargo & Co. 249,000 14,058,540
--------------
44,625,384
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES--10.6%
American
Express Co. 10,600 $ 518,870
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Citigroup, Inc. 293,366 14,107,971
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Franklin
Resources, Inc. 125,800 6,897,614
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Merrill Lynch
& Co., Inc. 81,200 4,403,476
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Morgan Stanley 312,100 16,038,819
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SLM Corp. 185,300 7,098,843
--------------
49,065,593
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INSURANCE--6.0%
Platinum
Underwriters
Holdings Ltd. 201,400 6,440,772
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Prudential
Financial, Inc. 379,100 16,657,654
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UnumProvident
Corp. 305,500 4,750,525
--------------
27,848,951
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HEALTH CARE--2.7%
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BIOTECHNOLOGY--2.3%
MedImmune, Inc. 1 427,900 10,372,296
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Wyeth 11,500 437,805
--------------
10,810,101
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PHARMACEUTICALS--0.4%
Schering-Plough
Corp. 108,200 1,810,186
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INDUSTRIALS--17.6%
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AEROSPACE & DEFENSE--7.8%
Boeing Co. 115,300 4,922,157
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Empresa Brasileira
de Aeronautica
SA, ADR 267,000 6,888,600
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Raytheon Co. 752,400 24,272,424
--------------
36,083,181
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COMMERCIAL SERVICES & SUPPLIES--3.0%
Cendant Corp. 583,700 13,822,016
11 | OPPENHEIMER VALUE FUND
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--6.8%
General Electric Co. 740,800 $ 22,186,960
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Tyco International
Ltd. 352,300 9,670,635
--------------
31,857,595
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INFORMATION TECHNOLOGY--9.8%
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COMPUTERS & PERIPHERALS--7.1%
Hewlett-Packard Co. 625,500 12,322,350
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International
Business Machines
Corp. 232,600 20,508,342
--------------
32,830,692
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IT SERVICES--1.0%
Unisys Corp. 1 362,500 4,723,375
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SOFTWARE--1.7%
Compuware Corp. 1 610,300 4,668,795
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Take-Two Interactive
Software, Inc. 1 116,300 3,359,907
--------------
8,028,702
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MATERIALS--4.7%
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CHEMICALS--3.2%
Dow Chemical Co. 138,400 5,493,096
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Praxair, Inc. 256,700 9,382,385
--------------
14,875,481
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METALS & MINING--1.0%
Inco Ltd. 1 161,800 4,651,750
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PAPER & FOREST PRODUCTS--0.5%
Bowater, Inc. 54,600 2,290,470
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TELECOMMUNICATION SERVICES--4.0%
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DIVERSIFIED TELECOMMUNICATION SERVICES--2.1%
IDT Corp., Cl. B 1 495,500 9,226,210
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SBC
Communications,
Inc. 1 16,000 398,400
--------------
9,624,610
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WIRELESS TELECOMMUNICATION SERVICES--1.9%
AT&T Corp. 234,300 4,018,245
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MARKET VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--Continued
Vodafone Group
plc, Sponsored ADR 196,600 $ 4,824,564
--------------
8,842,809
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UTILITIES--5.2%
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ELECTRIC UTILITIES--3.2%
AES Corp. (The) 1 1,204,600 10,443,882
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PG&E Corp. 1 167,100 4,598,592
--------------
15,042,474
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GAS UTILITIES--2.0%
Kinder Morgan, Inc. 75,500 4,545,855
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Sempra Energy 146,500 4,651,375
--------------
9,197,230
--------------
Total Common Stocks
(Cost $406,427,921) 446,755,981
PRINCIPAL
AMOUNT
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--1.9%
- --------------------------------------------------------------------------------
Undivided interest of 57.09% in joint
repurchase agreement (Principal Amount/
Market Value $15,818,000, with a maturity
value of $15,819,186) with Zion Bank/
Capital Markets Group, 0.90%, dated
4/30/04, to be repurchased at
$9,031,677 on 5/3/04, collateralized
by U.S. Treasury Nts., 5.875%, 11/15/05,
with a value of $16,157,500
(Cost $9,031,000) $9,031,000 9,031,000
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TOTAL INVESTMENTS,
AT VALUE
(COST $415,458,921) 98.2% 455,786,981
- --------------------------------------------------------------------------------
OTHER ASSETS
NET OF LIABILITIES 1.8 8,149,785
-----------------------------
NET ASSETS 100.0% $ 463,936,766
=============================
FOOTNOTE TO STATEMENT OF INVESTMENTS
1. Non-income producing security.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
12 | OPPENHEIMER VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES Unaudited
- --------------------------------------------------------------------------------
April 30, 2004
- ---------------------------------------------------------------------------------------------------
ASSETS
- ----------------------------------------------------------------------------------------------------
Investments, at value (cost $415,458,921)--see accompanying statement of investments $455,786,981
- ----------------------------------------------------------------------------------------------------
Cash 75,911
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Receivables and other assets:
Investments sold 13,470,430
Shares of capital stock sold 1,852,475
Interest and dividends 536,877
Other 11,606
-------------
Total assets 471,734,280
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LIABILITIES
- ----------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 7,018,503
Shares of capital stock redeemed 490,097
Distribution and service plan fees 94,539
Transfer and shareholder servicing agent fees 66,148
Shareholder communications 62,641
Directors' compensation 51,316
Other 14,270
-------------
Total liabilities 7,797,514
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NET ASSETS $463,936,766
=============
- ----------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ----------------------------------------------------------------------------------------------------
Par value of shares of capital stock $ 23,315
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Additional paid-in capital 419,112,407
- ----------------------------------------------------------------------------------------------------
Accumulated net investment income 379,750
- ----------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and foreign currency transactions 4,093,234
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Net unrealized appreciation on investments 40,328,060
-------------
NET ASSETS $463,936,766
=============
13 | OPPENHEIMER VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES Unaudited / Continued
- --------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- ----------------------------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of $298,175,778 and
14,868,689 shares of capital stock outstanding) $20.05
Maximum offering price per share (net asset value plus sales charge of 5.75% of offering price) $21.27
- ----------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge)
and offering price per share (based on net assets of $77,488,191 and 3,933,575 shares of
capital stock outstanding) $19.70
- ----------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge)
and offering price per share (based on net assets of $62,075,027 and 3,193,311 shares of
capital stock outstanding) $19.44
- ----------------------------------------------------------------------------------------------------------
Class N Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales charge)
and offering price per share (based on net assets of $22,123,550 and 1,119,391 shares of
capital stock outstanding) $19.76
- ----------------------------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based on net assets of
$4,074,220 and 199,853 shares of capital stock outstanding) $20.39
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
14 | OPPENHEIMER VALUE FUND
STATEMENT OF OPERATIONS Unaudited
- --------------------------------------------------------------------------------
For the Six Months Ended April 30, 2004
- ---------------------------------------------------------------------------------------
INVESTMENT INCOME
- ---------------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $48,193) $ 3,664,239
- ---------------------------------------------------------------------------------------
Interest 33,599
------------
Total investment income 3,697,838
- ---------------------------------------------------------------------------------------
EXPENSES
- ---------------------------------------------------------------------------------------
Management fees 1,223,850
- ---------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A 329,448
Class B 369,144
Class C 262,249
Class N 47,545
- ---------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 264,488
Class B 126,290
Class C 71,918
Class N 34,232
Class Y 261
- ---------------------------------------------------------------------------------------
Shareholder communications:
Class A 21,230
Class B 12,499
Class C 3,908
Class N 353
- ---------------------------------------------------------------------------------------
Directors' compensation 7,791
- ---------------------------------------------------------------------------------------
Accounting service fees 7,500
- ---------------------------------------------------------------------------------------
Custodian fees and expenses 1,938
- ---------------------------------------------------------------------------------------
Other 45,630
------------
Total expenses 2,830,274
Less reduction to custodian expenses (196)
Less voluntary waiver of transfer and shareholder servicing agent fees:
Class A (1,802)
Class C (535)
Class N (921)
------------
Net expenses 2,826,820
- ---------------------------------------------------------------------------------------
NET INVESTMENT INCOME 871,018
15 | OPPENHEIMER VALUE FUND
STATEMENT OF OPERATIONS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- --------------------------------------------------------------------------------
Net realized gain on:
Investments $ 33,592,611
Foreign currency transactions 38,230
-------------
Net realized gain 33,630,841
- --------------------------------------------------------------------------------
Net change in unrealized appreciation on investments (6,016,375)
- --------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 28,485,484
=============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
16 | OPPENHEIMER VALUE FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2004 OCTOBER 31,
(UNAUDITED) 2003
- ------------------------------------------------------------------------------------------------
OPERATIONS
- ------------------------------------------------------------------------------------------------
Net investment income $ 871,018 $ 300,084
- ------------------------------------------------------------------------------------------------
Net realized gain 33,630,841 15,182,559
- ------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (6,016,375) 39,305,650
---------------------------------
Net increase in net assets resulting from operations 28,485,484 54,788,293
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DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ------------------------------------------------------------------------------------------------
Dividends from net investment income:
Class A (574,991) (328,372)
Class B -- --
Class C -- --
Class N (59,111) (4,026)
Class Y (16,057) (1,634)
- ------------------------------------------------------------------------------------------------
CAPITAL STOCK TRANSACTIONS
- ------------------------------------------------------------------------------------------------
Net increase in net assets resulting from capital stock
transactions:
Class A 65,035,142 35,867,196
Class B 11,289,349 2,513,021
Class C 26,357,322 14,468,487
Class N 13,615,340 5,433,039
Class Y 1,267,942 1,172,727
- ------------------------------------------------------------------------------------------------
NET ASSETS
- ------------------------------------------------------------------------------------------------
Total increase 145,400,420 113,908,731
- ------------------------------------------------------------------------------------------------
Beginning of period 318,536,346 204,627,615
---------------------------------
End of period (including accumulated net investment income
of $379,750 and $158,891, respectively) $ 463,936,766 $ 318,536,346
=================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
17 | OPPENHEIMER VALUE FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
2004 OCT. 31,
CLASS A (UNAUDITED) 2003 2002 2001 2000 1999
- ------------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 18.46 $ 14.78 $ 15.93 $ 17.06 $ 20.69 $ 20.91
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .04 .04 .07 .03 .16 .17
Net realized and unrealized gain (loss) 1.60 3.67 (1.21) (.98) (.65) .64
--------------------------------------------------------------------------------------
Total from investment operations 1.64 3.71 (1.14) (.95) (.49) .81
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions
to shareholders:
Dividends from net investment income (.05) (.03) (.01) (.18) (.16) (.17)
Distributions from net realized gain -- -- -- -- (2.98) (.86)
--------------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.05) (.03) (.01) (.18) (3.14) (1.03)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.05 $ 18.46 $ 14.78 $ 15.93 $ 17.06 $ 20.69
======================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 1 8.88% 25.18% (7.15)% (5.60)% (2.60)% 3.60%
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $298,176 $215,019 $141,563 $166,285 $181,566 $392,483
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $270,956 $166,143 $166,319 $181,631 $234,840 $448,884
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 2
Net investment income 0.70% 0.37% 0.38% 0.19% 0.66% 0.68%
Total expenses 1.07% 3,4 1.22% 3,4 1.22% 3,4 1.26% 4 1.17% 4 1.02% 4
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 51% 117% 150% 336% 86% 135%
1. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares
on the reinvestment date, and redemption at the net asset value calculated on
the last business day of the fiscal period. Sales charges are not reflected in
the total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
2. Annualized for periods of less than one full year.
3. Voluntary waiver of transfer agent fees less than 0.01%.
4. Reduction to custodian expenses less than 0.01%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
18 | OPPENHEIMER VALUE FUND
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
2004 OCT. 31,
CLASS B (UNAUDITED) 2003 2002 2001 2000 1999
- ------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 18.18 $ 14.64 $ 15.89 $ 16.99 $ 20.58 $ 20.83
- ------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .04 (.06) (.10) (.11) (.05) (.03)
Net realized and unrealized gain (loss) 1.48 3.60 (1.15) (.97) (.56) .66
-------------------------------------------------------------------------------
Total from investment operations 1.52 3.54 (1.25) (1.08) (.61) .63
- ------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions
to shareholders:
Dividends from net investment income -- -- -- (.02) -- (.02)
Distributions from net realized gain -- -- -- -- (2.98) (.86)
-------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders -- -- -- (.02) (2.98) (.88)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 19.70 $ 18.18 $ 14.64 $ 15.89 $ 16.99 $ 20.58
===============================================================================
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 1 8.36% 24.18% (7.87)% (6.34)% (3.28)% 2.79%
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 77,488 $ 60,858 $ 47,323 $ 57,584 $ 64,287 $102,736
- ------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 74,322 $ 51,476 $ 56,200 $ 65,115 $ 79,239 $123,616
- ------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 2
Net investment loss (0.21)% (0.44)% (0.40)% (0.57)% (0.14)% (0.08)%
Total expenses 1.98% 2.14% 2.01% 2.01% 1.93% 1.77%
Expenses after expense reimbursement
or fee waiver and reduction to
custodian expenses N/A 3 2.05% N/A 3,4 N/A 3 N/A 3 N/A 3
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 51% 117% 150% 336% 86% 135%
1. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
2. Annualized for periods of less than one full year.
3. Reduction to custodian expenses less than 0.01%.
4. Voluntary waiver of transfer agent fees less than 0.01%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
19 | OPPENHEIMER VALUE FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
2004 OCT. 31,
CLASS C (UNAUDITED) 2003 2002 2001 2000 1999
- ------------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 17.93 $ 14.44 $ 15.67 $ 16.77 $ 20.35 $ 20.60
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .05 .03 (.01) (.08) (.04) (.02)
Net realized and unrealized gain (loss) 1.46 3.46 (1.22) (.99) (.56) .65
-------------------------------------------------------------------------------------
Total from investment operations 1.51 3.49 (1.23) (1.07) (.60) .63
- ------------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions
to shareholders:
Dividends from net investment income -- -- -- (.03) -- (.02)
Distributions from net realized gain -- -- -- -- (2.98) (.86)
-------------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders -- -- -- (.03) (2.98) (.88)
- ------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 19.44 $ 17.93 $ 14.44 $ 15.67 $ 16.77 $ 20.35
=====================================================================================
- ------------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 1 8.42% 24.17% (7.85)% (6.38)% (3.27)% 2.82%
- ------------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $62,075 $32,625 $13,466 $10,494 $ 9,849 $14,582
- ------------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $52,876 $21,366 $12,977 $11,088 $11,975 $17,746
- ------------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 2
Net investment loss (0.15)% (0.49)% (0.41)% (0.56)% (0.14)% (0.07)%
Total expenses 1.89% 3,4 2.07% 3,4 2.00% 3,4 2.01% 4 1.93% 4 1.77% 4
- ------------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 51% 117% 150% 336% 86% 135%
1. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
2. Annualized for periods of less than one full year.
3. Voluntary waiver of transfer agent fees less than 0.01%.
4. Reduction to custodian expenses less than 0.01%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
20 | OPPENHEIMER VALUE FUND
SIX MONTHS YEAR
ENDED ENDED
APRIL 30, 2004 OCT. 31,
CLASS N (UNAUDITED) 2003 2002 2001 1
- ---------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ---------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 18.25 $ 14.68 $ 15.90 $ 18.08
- ---------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) .05 .03 .05 (.02)
Net realized and unrealized gain (loss) 1.53 3.59 (1.22) (2.16)
------------------------------------------------------
Total from investment operations 1.58 3.62 (1.17) (2.18)
- ---------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.07) (.05) (.05) --
Distributions from net realized gain -- -- -- --
------------------------------------------------------
Total dividends and/or distributions to shareholders (.07) (.05) (.05) --
- ---------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 19.76 $ 18.25 $ 14.68 $ 15.90
======================================================
- ---------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 8.67% 24.70% (7.41)% (12.06)%
- ---------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ---------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $22,124 $ 7,417 $ 1,201 $ 12
- ---------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $19,201 $ 3,275 $ 508 $ 5
- ---------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income (loss) 0.29% (0.03)% 0.00% (0.45)%
Total expenses 1.47% 1.61% 1.49% 1.61%
Expenses after expense reimbursement or fee waiver
and reduction to custodian expenses N/A 4,5 1.55% N/A 4,5 N/A 5
- ---------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 51% 117% 150% 336%
1. For the period from March 1, 2001 (inception of offering) to October 31,
2001.
2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
3. Annualized for periods of less than one full year.
4. Voluntary waiver of transfer agent fees less than 0.01%.
5. Reduction to custodian expenses less than 0.01%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
21 | OPPENHEIMER VALUE FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
SIX MONTHS
ENDED YEAR
APRIL 30, ENDED
2004 OCT. 31,
CLASS Y (UNAUDITED) 2003 2002 2001 2000 1999
- -----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 18.79 $ 14.96 $ 16.20 $ 17.07 $ 20.72 $ 20.97
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) (.56) 1 (1.86) 1 .06 1 .10 1 .17 1 .22
Net realized and unrealized gain (loss) 2.27 1 5.71 1 (1.21) 1 (.97) 1 (.63) 1 .64
------------------------------------------------------------------------------------
Total from investment operations 1.71 3.85 (1.15) (.87) (.46) .86
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions
to shareholders:
Dividends from net investment income (.11) (.02) (.09) -- (.21) (.25)
Distributions from net realized gain -- -- -- -- (2.98) (.86)
------------------------------------------------------------------------------------
Total dividends and/or distributions
to shareholders (.11) (.02) (.09) -- (3.19) (1.11)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.39 $ 18.79 $ 14.96 $ 16.20 $ 17.07 $ 20.72
====================================================================================
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 2 9.14% 25.78% (7.18)% (5.10)% (2.42)% 3.81%
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 4,074 $ 2,617 $ 1,074 $ 638 $ 1 $76,571
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 3,476 $ 1,558 $ 955 $ 155 $48,714 $95,765
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 3
Net investment income 1.15% 0.76% 0.33% 0.62% 1.06% 0.90%
Total expenses 0.63% 1.19% 3.77% 1.20% 0.97% 0.76%
Expenses after expense reimbursement
or fee waiver and reduction to
custodian expenses N/A 4 0.80% 1.23% 0.83% N/A 4 N/A 4
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 51% 117% 150% 336% 86% 135%
1. Per share amounts calculated based on the average shares outstanding during
the period.
2. Assumes an investment on the business day before the first day of the fiscal
period, with all dividends and distributions reinvested in additional shares on
the reinvestment date, and redemption at the net asset value calculated on the
last business day of the fiscal period. Sales charges are not reflected in the
total returns. Total returns are not annualized for periods of less than one
full year. Returns do not reflect the deduction of taxes that a shareholder
would pay on Fund distributions or the redemption of Fund shares.
3. Annualized for periods of less than one full year.
4. Reduction to custodian expenses less than 0.01%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
22 | OPPENHEIMER VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Value Fund (the Fund), a series of Oppenheimer Series Fund, Inc.
(the Company), 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 by investing primarily in
common stocks with low price-earnings ratios and better-than-anticipated
earnings. The Fund's investment advisor is OppenheimerFunds, Inc. (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 with respect to the Fund in general and exclusive
voting rights on matters that affect that class alone. 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. The Fund calculates the net asset value of its shares as
of the close of The New York Stock Exchange (the Exchange), normally 4:00 P.M.
Eastern time, on each day the Exchange is open for business. 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 may be valued primarily using dealer-supplied valuations or a
portfolio pricing service authorized by the Board of Directors. Securities
(including restricted securities) for which market quotations are not readily
available are valued at their fair value. Foreign securities whose values have
been materially affected by what the Manager identifies as a significant event
occurring before the Fund's assets are valued but after the close of their
respective foreign exchanges will be fair valued. Fair value is determined in
good faith using consistently applied procedures under the supervision of the
Board of Directors. Short-term "money market type" debt securities with
remaining maturities of sixty days or less are valued at amortized cost (which
approximates market value).
23 | OPPENHEIMER VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. Prices of securities denominated in foreign currencies are
translated into U.S. dollars at the closing rates of exchange. Amounts related
to the purchase and sale of foreign securities and investment income are
translated at the rates of exchange prevailing on the respective dates of such
transactions.
Reported net realized foreign exchange gains or losses arise from sales of
portfolio securities, sales and maturities of short-term securities, sales of
foreign currencies, currency gains or losses realized between the trade and
settlement dates on securities transactions, and the difference between the
amounts of dividends, interest, and foreign withholding taxes recorded on the
Fund's books and the U.S. dollar equivalent of the amounts actually received or
paid. Net unrealized foreign exchange gains and losses arise from changes in the
values of assets and liabilities, including investments in securities at fiscal
period end, resulting from changes in exchange rates.
The effect of changes in foreign currency exchange rates on investments is
separately identified from the fluctuations arising from changes in market
values of securities held and reported with all other foreign currency gains and
losses in the Fund's Statement of Operations.
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS. 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. 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 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.
Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends
24 | OPPENHEIMER VALUE FUND
and distributions, the fiscal year in which amounts are distributed may differ
from the fiscal year in which the income or net realized gain was recorded by
the Fund.
As of April 30, 2004, the Fund had available for federal income tax
purposes an estimated unused capital loss carryforward of zero. 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 April 30, 2004 and the year ended October 31, 2003, the Fund used
$27,993,109 and $13,852,965, respectively, of carryforward to offset capital
gains realized.
As of October 31, 2003, the Fund had available for federal income tax purposes
unused capital loss carryforwards as follows:
EXPIRING
----------------------
2009 $ 825,069
2010 27,168,040
-----------
Total $27,993,109
===========
- --------------------------------------------------------------------------------
DIRECTORS' COMPENSATION. The Fund has adopted an unfunded retirement plan for
the Fund's independent directors. Benefits are based on years of service and
fees paid to each director during the years of service. During the six months
ended April 30, 2004, the Fund's projected benefit obligations were increased by
$2,776 and payments of $2,806 were made to retired directors, resulting in an
accumulated liability of $44,410 as of April 30, 2004.
The Board of Directors has adopted a deferred compensation plan for
independent directors that enable directors to elect to defer receipt of all or
a portion of the annual compensation they are entitled to receive from the Fund.
For purposes of determining the amount owed to the under the plan, deferred
amounts are treated as though equal dollar amounts had been invested in shares
of the Fund or in other Oppenheimer funds selected by the Director. The Fund
does purchase shares of the funds selected for deferral by the Director in
amounts equal to his or her deemed investment, resulting in a Fund asset equal
to the deferred compensation liability. Such assets are included as a component
of "Other" within the asset section of the Statement of Assets and Liabilities.
Deferral of directors' 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
25 | OPPENHEIMER VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
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, if applicable,
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 U.S. generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of income and expenses during the reporting
period. Actual results could differ from those estimates.
In the ordinary course of business, the Fund enters into contracts that
contain a variety of indemnifications. The Fund's maximum exposure under these
arrangements is unknown. However, the Fund has not had prior claims or losses
pursuant to these contracts and expects the risk of loss to be remote.
- --------------------------------------------------------------------------------
2. SHARES OF CAPITAL STOCK
The Fund has authorized 600 million shares of $0.001 par value capital stock of
each class. Transactions in shares of capital stock were as follows:
SIX MONTHS ENDED APRIL 30, 2004 YEAR ENDED OCTOBER 31, 2003
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------
CLASS A
Sold 3,967,040 $ 80,833,682 4,264,565 $ 70,376,827
Dividends and/or
distributions reinvested 26,697 512,868 20,386 312,728
Acquisition-Note 5 393,950 7,335,351 248,058 4,532,025
Redeemed (1,164,367) (23,646,759) (2,463,894) (39,354,384)
------------------------------------------------------------------
Net increase 3,223,320 $ 65,035,142 2,069,115 $ 35,867,196
==================================================================
- ------------------------------------------------------------------------------------------------
CLASS B
Sold 1,062,831 $ 21,354,184 1,231,988 $ 19,785,723
Dividends and/or
distributions reinvested -- -- -- --
Acquisition-Note 5 286,209 5,246,208 113,904 2,051,415
Redeemed (763,639) (15,311,043) (1,230,153) (19,324,117)
------------------------------------------------------------------
Net increase 585,401 $ 11,289,349 115,739 $ 2,513,021
==================================================================
26 | OPPENHEIMER VALUE FUND
SIX MONTHS ENDED APRIL 30, 2004 YEAR ENDED OCTOBER 31, 2003
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------
CLASS C
Sold 1,200,746 $ 23,640,505 1,864,248 $ 28,908,203
Dividends and/or
distributions reinvested -- -- -- --
Acquisition-Note 5 440,763 7,968,992 101,608 1,804,555
Redeemed (267,939) (5,252,175) (1,078,588) (16,244,271)
------------------------------------------------------------------
Net increase 1,373,570 $ 26,357,322 887,268 $ 14,468,487
==================================================================
- ------------------------------------------------------------------------------------------------
CLASS N
Sold 390,270 $ 7,852,838 348,563 $ 5,697,204
Dividends and/or
distributions reinvested 3,115 59,100 264 4,022
Acquisition-Note 5 452,633 8,332,974 31,233 564,383
Redeemed (132,942) (2,629,572) (55,602) (832,570)
------------------------------------------------------------------
Net increase 713,076 $ 13,615,340 324,458 $ 5,433,039
==================================================================
- ------------------------------------------------------------------------------------------------
CLASS Y
Sold 83,751 $ 1,753,253 65,067 $ 1,092,179
Dividends and/or
distributions reinvested 822 16,039 105 1,632
Acquisition-Note 5 51 969 33,446 621,753
Redeemed (24,033) (502,319) (31,137) (542,837)
------------------------------------------------------------------
Net increase 60,591 $ 1,267,942 67,481 $ 1,172,727
==================================================================
- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the six months ended April 30, 2004, were
$318,164,187 and $205,422,729, 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 0.625% of the first $300 million of average annual net assets of
the Fund, 0.50% of the next $100 million, and 0.45% of average annual net assets
in excess of $400 million.
- --------------------------------------------------------------------------------
ACCOUNTING FEES. The Manager acts as the accounting agent for the Fund at an
annual fee of $15,000, plus out-of-pocket costs and expenses reasonably
incurred.
- --------------------------------------------------------------------------------
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 six months ended April 30, 2004, the Fund paid
$494,572 to OFS for services to the Fund.
Additionally, Class Y shares are subject to minimum fees of $10,000 for
assets of $10 million or more. The Class Y shares are subject to the minimum
fees in the event that the
27 | OPPENHEIMER VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued
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 for all classes to 0.35% of average annual net assets per class. 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 Fund, OppenheimerFunds Distributor, Inc. (the Distributor)
acts as the Fund's principal underwriter in the continuous public offering of
the Fund's classes of shares.
- --------------------------------------------------------------------------------
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. The Distributor currently uses all of those fees to
pay dealers, brokers, banks and other financial institutions quarterly for
providing personal services and maintenance of accounts of their customers that
hold Class A shares. Any unreimbursed expenses the Distributor incurs with
respect to Class A shares in any fiscal year cannot be recovered in subsequent
years. Fees incurred by the Fund under the Plan are detailed in the Statement of
Operations.
- --------------------------------------------------------------------------------
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 to compensate the Distributor for its services in connection with the
distribution of those shares and servicing accounts. 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 0.25% per year on Class N shares. The
Distributor also receives a service fee of up to 0.25% per year under each plan.
If either the Class B, Class C or Class N plan is terminated by the Fund or by
the shareholders of a class, the Board of Directors and its independent
directors must determine whether the Distributor shall be entitled to payment
from the Fund of all or a portion of the service fee and/or asset-based sales
charge in respect to shares sold prior to the effective date of such
termination. The Distributor's aggregate uncompensated expenses under the plan
at April 30, 2004 for Class B, Class C and Class N shares were $2,566,663,
$856,837 and $318,219, respectively. Fees incurred by the Fund under the plans
are detailed in the Statement of Operations.
- --------------------------------------------------------------------------------
SALES CHARGES. Front-end sales charges and contingent deferred sales charges
(CDSC) do not represent expenses of the Fund. They are deducted from the
proceeds of sales of Fund shares prior to investment or from redemption proceeds
prior to remittance, as applicable. The sales charges retained by the
Distributor from the sale of shares and the CDSC retained by the Distributor on
the redemption of shares is shown in the table below for the period indicated.
28 | OPPENHEIMER VALUE FUND
CLASS A CLASS B CLASS C CLASS N
CLASS A CONTINGENT CONTINGENT CONTINGENT CONTINGENT
FRONT-END DEFERRED DEFERRED DEFERRED DEFERRED
SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES
SIX MONTHS RETAINED BY RETAINED BY RETAINED BY RETAINED BY RETAINED BY
ENDED DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR
- --------------------------------------------------------------------------------------------------------------
April 30, 2004 $254,999 $256 $72,296 $6,884 $6,610
- --------------------------------------------------------------------------------
5. ACQUISITION OF OPPENHEIMER TRINITY VALUE FUND AND OPPENHEIMER SELECT MANAGERS
SALOMON BROTHERS ALL CAP FUND
OPPENHEIMER TRINITY VALUE FUND
On September 18, 2003, the Fund acquired all of the net assets of Oppenheimer
Trinity Value Fund, pursuant to an Agreement and Plan of Reorganization approved
by the Oppenheimer Trinity Value Fund shareholders on September 12, 2003. The
Fund issued (at an exchange ratio of 0.462030 for Class A, 0.454702 for Class B,
0.467218 for Class C, 0.462387 for Class N and 0.458575 for Class Y of the Fund
to one share of Oppenheimer Value Fund 248,058; 113,904; 101,608; 31,233 and
33,446 shares of capital stock for Class A, Class B, Class C, Class N and Class
Y, respectively, valued at $4,532,025, $2,051,415, $1,804,555, $564,383 and
$621,753 in exchange for the net assets, resulting in combined Class A net
assets of $199,379,468, Class B net assets of $59,597,524, Class C net assets
$31,165,757, Class N net assets of $6,114,820 and Class Y net assets of
$2,499,533 on September 18, 2003. The net assets acquired included net
unrealized appreciation of $721,866 and an unused capital loss carryforward of
$2,018,832, potential utilization subject to tax limitations. The exchange
qualified as a tax-free reorganization for federal income tax purposes.
- --------------------------------------------------------------------------------
OPPENHEIMER SELECT MANAGERS SALOMON BROTHERS ALL CAP FUND
On November 6, 2003, the Fund acquired all of the net assets of Oppenheimer
Select Managers Salomon Brothers All Cap Fund, pursuant to an Agreement and Plan
of Reorganization approved by the Oppenheimer Select Managers Salomon Brothers
All Cap Fund shareholders on October 31, 2003. The Fund issued (at an exchange
ratio of 0.516576 for Class A, 0.514763 for Class B, 0.521451 for Class C,
0.517683 for Class N and 0.511551 for Class Y of the Fund to one share of
Oppenheimer Value Fund) 393,950; 286,209; 440,763; 452,633 and 51 shares of
beneficial interest for Class A, Class B, Class C, Class N and Class Y,
respectively, valued at $7,335,351, $5,246,208, $7,968,992, $8,332,974 and $969
in exchange for the net assets, resulting in combined Class A net assets of
$227,060,486, Class B net assets of $66,085,206, Class C net assets of
$41,217,738, Class N net assets of $15,907,953 and Class Y net assets of
$2,648,868 on November 6, 2003. The net assets acquired included net unrealized
appreciation of $2,862,951 and an unused capital loss carryforward of
$2,523,977, potential utilization subject to tax limitation. The exchange
qualified as a tax-free reorganization for federal income tax purposes.
29 | OPPENHEIMER VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
6. BORROWING AND LENDING ARRANGEMENTS
The Fund entered into an "interfund borrowing and lending arrangement" with
other funds in the Oppenheimer funds complex, to allow funds to borrow for
liquidity purposes. The arrangement was initiated pursuant to exemptive relief
granted by the Securities and Exchange Commission (the SEC) to allow these
affiliated funds to lend money to, and borrow money from, each other, in an
attempt to reduce borrowing costs below those of bank loan facilities. The SEC's
order requires the Fund's Board of Directors to adopt operating policies and
procedures to administer interfund borrowing and lending. Under the arrangement
the Fund may lend money to other Oppenheimer funds and may borrow from other
Oppenheimer funds at a rate set by the Fund's Board of Directors, based upon a
recommendation by the Manager. The Fund's borrowings, if any, are subject to
asset coverage requirements under the Investment Company Act and the provisions
of the SEC order and other applicable regulations. If the Fund borrows money,
there is a risk that the loan could be called on one day's notice, in which case
the Fund might have to borrow from a bank at higher rates if a loan were not
available from another Oppenheimer fund. If the Fund lends money to another
fund, it will be subject to the risk that the other fund might not repay the
loan in a timely manner, or at all.
The Fund had no interfund borrowings or loans outstanding during the six
months ended or at April 30, 2004.
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 VALUE FUND
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 Directors of the registrant has determined that the
registrant does not have an audit committee financial expert serving on its
Audit Committee. In this regard, no member of the Audit Committee was identified
as having all of the technical attributes identified in Instruction 2(b) to Item
3 of Form N-CSR to qualify as an "audit committee financial expert," whether
through the type of specialized education or experience described in that
Instruction. The Board has concluded that while the members of the Audit
Committee collectively have the necessary attributes and experience required to
serve effectively as an Audit Committee, no single member possesses all of the
required technical attributes through the particular methods of education or
experience set forth in the Instructions to be designated as an audit committee
financial expert.
Item 4. Principal Accountant Fees and Services
Not applicable to semiannual reports.
Item 5. Not applicable
Item 6. Schedule of Investments
Not applicable
Item 7. Not applicable
Item 8. Not applicable
Item 9. Submission of Matters to a Vote of Security Holders
The Board is responsible for approving nominees for election as
directors. To assist in this task, the Board has designated the Audit Committee
as the nominating committee for the Board. It reviews and recommends nominees to
the Board. The Committee is comprised entirely of disinterested directors as
defined in Section 2(a)(19) of the Investment Company Act of 1940.
The Audit Committee charter describes the responsibilities of the
Committee in nominating candidates for election as independent Directors of the
Registrant. The Registrant's Board has adopted a written charter for the
Committee. A current copy of the Audit Committee charter is available to
shareholders on the OppenheimerFunds website at www.oppenheimerfunds.com.
Under the current policy, if the Board determines that a vacancy
exists or is likely to exist on the Board, the Audit Committee of the Board will
consider candidates for Board membership including recommended by Registrant
shareholders. The Audit Committee will consider nominees recommended by
independent Board members or recommended by any other Board members including
Board members affiliated with the Registrant's investment advisors. The
Committee may, upon Board approval, retain an executive search firm to assist in
screening potential candidates. Upon Board approval, the Audit Committee may
also use the services of legal, financial, or other external counsel that it
deems necessary or desirable in the screening process. Shareholders wishing to
submit a nominee for election to the Board may do so by mailing their submission
to the offices of OppenheimerFunds, Inc., 6803 South Tucson Way, Centennial, CO
80112, to the attention of the Board of Directors of the named Registrant, c/o
the Secretary of the Registrant.
The Committee's process for identifying and evaluating nominees for
directors includes a number of factors. In screening candidates for board
membership, whether the candidate is suggested by Board members, shareholders or
others, the Committee considers the candidate's professional experience,
soundness of judgment, integrity, ability to make independent, analytical
inquiries, collegiality, willingness and ability to devote the time required to
perform Board activities adequately, ability to represent the interests of all
shareholders of the Registrant, and diversity relative to the board's
composition. Candidates are expected to provide a mix of attributes, experience,
perspective and skills necessary to effectively advance the interests of
shareholders.
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 April 30, 2004,
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)