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 811-21369
OPPENHEIMER INTERNATIONAL VALUE FUND
------------------------------------
(Exact name of registrant as specified in charter)
6803 SOUTH TUCSON WAY, CENTENNIAL, COLORADO 80112-3924
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(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
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Date of fiscal year end: APRIL 30
Date of reporting period: MAY 1, 2004 - APRIL 30, 2005
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ITEM 1. REPORTS TO STOCKHOLDERS.
TOP HOLDINGS AND ALLOCATIONS
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TOP TEN GEOGRAPHICAL HOLDINGS
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Japan 22.2%
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France 14.9
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United Kingdom 14.1
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Germany 5.8
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The Netherlands 5.6
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Italy 4.8
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United States 4.6
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Switzerland 3.9
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Canada 3.4
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Belgium 3.1
Portfolio holdings and allocations are subject to change. Percentages are as of
April 30, 2005, and are based on total market value of investments.
TOP TEN COMMON STOCK HOLDINGS
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GlaxoSmithKline plc 2.6%
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Jupiter Telecommunications Co. Ltd. 2.4
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easyJet plc 2.3
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Mediceo Holdings Co. Ltd. 2.3
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Toyota Motor Corp. 2.2
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Fondiaria-Sai SpA 2.2
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Total SA, B Shares 2.0
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Nokia Oyj 2.0
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ENI SpA 1.9
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Swiss Reinsurance Co. 1.9
Portfolio holdings and allocations are subject to change. Percentages are as of
April 30, 2005, and are based on net assets.
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REGIONAL ALLOCATION
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Europe 64.3%
Asia 25.4
United States/Canada 8.0
Latin America 1.3
Middle East/Africa 1.0
Portfolio holdings and allocations are subject to change. Percentages are as of
April 30, 2005, and are based on total market value of investments.
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7 | OPPENHEIMER INTERNATIONAL VALUE FUND
FUND PERFORMANCE DISCUSSION
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HOW HAS THE FUND PERFORMED? BELOW IS A DISCUSSION BY OPPENHEIMERFUNDS, INC., OF
THE FUND'S PERFORMANCE DURING ITS FISCAL YEAR ENDED APRIL 30, 2005, FOLLOWED BY
A GRAPHICAL COMPARISON OF THE FUND'S PERFORMANCE TO AN APPROPRIATE BROAD-BASED
MARKET INDEX.
MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE. The Fund performed well during the
reporting period, producing higher returns with lower short-term volatility than
its benchmark. We attribute the Fund's strong relative performance to the
success of our security selection strategy, which proved to be a stronger
positive influence than other factors, such as sector allocation. Indeed, the
Fund's sector allocations roughly matched those of its benchmark, a strategy
designed to manage certain risks.
During the reporting period, approximately 65% of the Fund's assets were
invested in Europe and about 20% were invested in Japan. Although Japan's stock
market declined slightly over the reporting period, the Fund's holdings of
Japanese stocks made a strongly positive contribution to the Fund's results. For
example, Japanese medical technology provider Sysmex Corp. gained market share
and achieved higher profits as sales of its hematology analysis products
improved. In Hong Kong, a leading provider of manufacturing services for
telecommunications products gained value as it solidified its leadership
position as a low-cost supplier of cordless telephone handsets to European
markets.
The Fund's holdings of European stocks also produced significantly higher
returns than the averages. United Kingdom-based airline easyJet plc rallied from
a previously low valuation as investors increasingly recognized its track record
of producing consistent profits and the benefits of its relatively low-cost
fleet. Ireland's Anglo Irish Bank Corp., which has been Europe's fastest-growing
bank for many years, continued to generate gains. In addition, the Fund's
investments in Europe benefited from its position in corporate bonds issued by
Zurich Reinsurance Centres Holdings, Inc. We chose to invest in this company's
bonds, rather than its stock, due to what we considered to be a more attractive
risk-reward profile. This decision proved to be fortuitous as the company's
bonds gained value over the reporting period, while its stock did not.
Of course, the Fund also received disappointing results from some of its
holdings. Chief among them was Canada's CFM Corp., a manufacturer of fireplace
and barbeque products. Unexpected financial difficulties led to a buy-out of the
company at a relatively low price. The Fund's returns were hindered to a lesser
extent by its investment in luxury glassware purveyor Waterford Wedgewood plc,
which was hurt by the declining U.S. dollar's adverse influence on sales.
Finally, the Fund's currency hedging strategy detracted mildly from performance.
COMPARING THE FUND'S PERFORMANCE TO THE MARKET. The graphs that follow show the
performance of a hypothetical $10,000 investment in each class of shares of the
Fund held until April 30, 2005. In the case of Class A shares, performance is
measured from the inception date of August 1, 2003. In the case of Class B and
Class C shares, performance is measured from inception of the classes on May 6,
2004. The Fund's performance reflects the deduction of the maximum initial sales
charge on Class A shares, the applicable contingent deferred sales charge on
Class B and Class C shares, and reinvestments of all dividends and capital gains
distributions. Past performance cannot guarantee future results.
The Fund's performance is compared to the performance of the Morgan
Stanley Capital International (MSCI) World Index is an unmanaged index of
issuers listed on the stock exchange of 20 countries and the U.S. Index
performance reflects the reinvestment of income but does not consider the effect
of transaction costs, and none of the data in the graphs shows the effect of
taxes. The Fund's performance reflects the effects of the Fund's business and
operating expenses. While index comparisons may be useful to provide a benchmark
for the Fund's performance, it must be noted that the Fund's investments are not
limited to the investments in the index.
8 | OPPENHEIMER INTERNATIONAL VALUE FUND
CLASS A SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer International Value Fund (Class A)
MSCI World Index
Oppenheimer International MSCI
Value Fund (Class A) World Index
08/01/2003 9,425 10,000
10/31/2003 10,669 10,896
01/31/2004 11,689 11,952
04/30/2004 12,286 11,840
07/31/2004 12,106 11,811
10/31/2004 12,844 12,395
01/31/2005 14,576 13,251
04/30/2005 14,466 13,134
AVERAGE ANNUAL TOTAL RETURNS OF CLASS A SHARES WITH SALES CHARGE OF THE FUND AT
4/30/05
1-YEAR 10.97% SINCE INCEPTION (8/1/03) 23.53%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
9 | OPPENHEIMER INTERNATIONAL VALUE FUND
FUND PERFORMANCE DISCUSSION
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CLASS B SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer International Value Fund (Class B)
MSCI World Index
Oppenheimer International MSCI
Value Fund (Class B) World Index
05/06/2004 10,000 10,000
07/31/2004 9,823 9,976
10/31/2004 10,400 10,469
01/31/2005 11,761 11,192
04/30/2005 11,147 11,093
AVERAGE ANNUAL TOTAL RETURNS OF CLASS B SHARES WITH SALES CHARGE OF THE FUND AT
4/30/05
1-YEAR N/A SINCE INCEPTION (5/6/04) 11.47%
10 | OPPENHEIMER INTERNATIONAL VALUE FUND
CLASS C SHARES
COMPARISON OF CHANGE IN VALUE OF $10,000 HYPOTHETICAL INVESTMENTS IN:
Oppenheimer International Value Fund (Class C)
MSCI World Index
Oppenheimer International MSCI
Value Fund (Class C) World Index
05/06/2004 10,000 10,000
07/31/2004 9,823 9,976
10/31/2004 10,393 10,469
01/31/2005 11,761 11,192
04/30/2005 11,547 11,093
AVERAGE ANNUAL TOTAL RETURNS OF CLASS C SHARES WITH SALES CHARGE OF THE FUND AT
4/30/05
1-YEAR N/A SINCE INCEPTION (5/6/04) 15.47%
THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH DOES NOT
GUARANTEE FUTURE RESULTS. THE INVESTMENT RETURN AND PRINCIPAL VALUE OF AN
INVESTMENT IN THE FUND WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN
REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT
PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE
DATA CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.OPPENHEIMERFUNDS.COM,
OR CALL US AT 1.800.525.7048. FUND RETURNS INCLUDE CHANGES IN SHARE PRICE,
REINVESTED DISTRIBUTIONS, AND THE APPLICABLE SALES CHARGE: FOR CLASS A SHARES,
THE CURRENT MAXIMUM INITIAL SALES CHARGE OF 5.75%; FOR CLASS B SHARES, THE
CONTINGENT DEFERRED SALES CHARGE OF 5% (1-YEAR) AND 2% (5-YEAR); AND FOR CLASS C
SHARES, THE CONTINGENT 1% DEFERRED SALES CHARGE FOR THE 1-YEAR PERIOD.
11 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES
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Total returns and the ending account values in the graphs include changes in
share price and reinvestment of dividends and capital gains distributions in a
hypothetical investment for the periods shown. The Fund's total returns shown do
not reflect the deduction of income taxes on an individual's investment. Taxes
may reduce your actual investment returns on income or gains paid by the Fund or
any gains you may realize if you sell your shares. INVESTORS SHOULD CONSIDER THE
FUND'S INVESTMENT OBJECTIVES, RISKS, AND OTHER CHARGES AND EXPENSES CAREFULLY
BEFORE INVESTING. THE FUND'S PROSPECTUS CONTAINS THIS AND OTHER INFORMATION
ABOUT THE FUND, AND MAY BE OBTAINED BY ASKING YOUR FINANCIAL ADVISOR, CALLING US
AT 1.800.525.7048 OR VISITING OUR WEBSITE AT WWW.OPPENHEIMERFUNDS.COM. READ THE
PROSPECTUS CAREFULLY BEFORE INVESTING.
The Fund's investment strategy and focus can change over time. The mention of
specific fund holdings does not constitute a recommendation by OppenheimerFunds,
Inc.
Please remember this Fund has a limited operating history.
CLASS A shares of the Fund were first offered on 8/1/03. Unless otherwise noted,
Class A returns include the current maximum initial sales charge of 5.75%.
CLASS B shares of the Fund were first publicly offered on 5/6/04. Unless
otherwise noted, Class B returns include the applicable contingent deferred
sales charge of 5% (1-year). Class B shares are subject to an annual 0.75%
asset-based sales charge.
CLASS C shares of the Fund were first publicly offered on 5/6/04. Unless
otherwise noted, Class C returns include the contingent deferred sales charge of
1% for the 1-year period. Class C shares are subject to an annual 0.75%
asset-based sales charge.
An explanation of the calculation of performance is in the Fund's Statement of
Additional Information.
12 | OPPENHEIMER INTERNATIONAL VALUE FUND
FUND EXPENSES
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FUND EXPENSES. As a shareholder of the Fund, you incur two types of costs: (1)
transaction costs, which may include sales charges (loads) on purchase payments,
contingent deferred sales charges on redemptions; and redemption fees, if any;
and (2) ongoing costs, including management fees; distribution and service fees;
and other Fund expenses. These examples are intended to help you understand your
ongoing costs (in dollars) of investing in the Fund and to compare these costs
with the ongoing costs of investing in other mutual funds.
The examples are based on an investment of $1,000.00 invested at the beginning
of the period and held for the entire 6-month period ended April 30, 2005.
ACTUAL EXPENSES. The "actual" lines of the table provide information about
actual account values and actual expenses. You may use the information on this
line for the class of shares you hold, together with the amount you invested, to
estimate the expense that you paid over the period. Simply divide your account
value by $1,000.00 (for example, an $8,600.00 account value divided by $1,000.00
= 8.60), then multiply the result by the number in the "actual" line under the
heading entitled "Expenses Paid During Period" to estimate the expenses you paid
on your account during this period.
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES. The "hypothetical" lines of the
table provide information about hypothetical account values and hypothetical
expenses based on the Fund's actual expense ratio for each class of shares, and
an assumed rate of return of 5% per year before expenses, which is not the
Fund's actual return. The hypothetical account values and expenses may not be
used to estimate the actual ending account balance or expenses you paid for the
period. You may use this information to compare the ongoing costs of investing
in the Fund and other funds. To do so, compare this 5% hypothetical example for
the class of shares you hold with the 5% hypothetical examples that appear in
the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front-end
or contingent deferred sales charges (loads), redemption fees, or a $12.00 fee
imposed annually on accounts valued at less than $500.00 (subject to exceptions
described in the Statement of Additional Information). Therefore, the
"hypothetical" lines of the table are useful in comparing ongoing costs only,
and will not help you determine the relative total costs of owning different
funds. In addition, if these transactional costs were included, your costs would
have been higher.
13 | OPPENHEIMER INTERNATIONAL VALUE FUND
FUND EXPENSES
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BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT PAID DURING
VALUE VALUE 6 MONTHS ENDED
(11/1/04) (4/30/05) APRIL 30, 2005
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Class A Actual $ 1,000.00 $ 1,126.20 $ 8.25
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Class A Hypothetical 1,000.00 1,017.06 7.83
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Class B Actual 1,000.00 1,119.90 12.95
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Class B Hypothetical 1,000.00 1,012.65 12.30
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Class C Actual 1,000.00 1,120.70 12.74
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Class C Hypothetical 1,000.00 1,012.84 12.10
Hypothetical assumes 5% annual return before expenses.
Expenses are equal to the Fund's annualized expense ratio for that class,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period). Those annualized expense ratios based on
the 6-month period ended April 30, 2005 are as follows:
CLASS EXPENSE RATIOS
- ----------------------------------
Class A 1.56%
- ----------------------------------
Class B 2.45
- ----------------------------------
Class C 2.41
The expense ratios reflect voluntary waivers or reimbursements of expenses by
the Fund's Manager and Transfer Agent that can be terminated at any time,
without advance notice. The "Financial Highlights" tables in the Fund's
financial statements, included in this report, also show the gross expense
ratios, without such waivers or reimbursements.
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14 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF INVESTMENTS April 30, 2005
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VALUE
SHARES SEE NOTE 1
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COMMON STOCKS--93.2%
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CONSUMER DISCRETIONARY--18.6%
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AUTO COMPONENTS--1.6%
Continental AG 10,516 $ 776,093
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AUTOMOBILES--4.2%
Bayerische Motoren Werke AG 12,686 537,739
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PSA Peugeot Citroen 6,775 401,377
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Toyota Motor Corp. 28,000 1,019,613
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1,958,729
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DISTRIBUTORS--2.9%
Fujitsu Devices, Inc. 58,000 669,337
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Medion AG 45,078 687,403
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1,356,740
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HOTELS, RESTAURANTS & LEISURE--2.2%
Compass Group plc 154,330 690,448
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Taito Corp. 224 333,276
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1,023,724
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HOUSEHOLD DURABLES--2.6%
Barratt Developments plc 50,730 575,675
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JM AB 6,596 219,316
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Matsushita Electric Industrial Co. 22,000 322,499
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Waterford Wedgwood plc 1 2,748,037 127,841
-------------
1,245,331
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LEISURE EQUIPMENT & PRODUCTS--1.2%
Agfa Gevaert NV 12,900 419,658
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Sega Sammy Holdings, Inc. 2,200 128,558
-------------
548,216
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MEDIA--1.3%
Vivendi Universal SA 1 21,090 626,571
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SPECIALTY RETAIL--2.6%
Aoyama Trading Co. 14,073 368,435
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Kingfisher plc 49,000 230,947
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New Dixons Group plc 236,570 644,271
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1,243,653
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CONSUMER STAPLES--8.7%
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BEVERAGES--0.8%
Heineken NV 11,900 378,140
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FOOD & STAPLES RETAILING--0.9%
J Sainsbury plc 76,483 412,947
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FOOD PRODUCTS--5.4%
CoolBrands International, Inc. 1 147,400 673,568
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Nestle SA 3,340 874,572
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Nutreco Holding NV 13,363 423,748
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Unilever NV 9,128 588,242
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2,560,130
VALUE
SHARES SEE NOTE 1
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HOUSEHOLD PRODUCTS--0.8%
Reckitt Benckiser plc 10,730 $ 348,384
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PERSONAL PRODUCTS--0.8%
Amore Pacific Corp. 1,521 376,780
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ENERGY--5.1%
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ENERGY EQUIPMENT & SERVICES--1.2%
TGS Nopec Geophysical Co. ASA 1 20,500 552,009
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OIL & GAS--3.9%
ENI SpA 36,000 903,834
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Total SA, B Shares 4,270 947,863
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1,851,697
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FINANCIALS--16.0%
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COMMERCIAL BANKS--7.1%
Anglo Irish Bank Corp. 1 35,596 409,055
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Bank of Ireland 43,787 663,036
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Credit Agricole SA 32,841 850,307
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Danske Bank AS 18,700 546,212
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Grupo Financiero Inbursa SA de CV 96,600 200,103
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Royal Bank of Scotland Group
plc (The) 22,050 665,273
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3,333,986
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DIVERSIFIED FINANCIAL SERVICES--2.8%
Ichiyoshi Securities Co. Ltd. 48,000 444,521
- --------------------------------------------------------------------------------
Investor AB, B Shares 42,786 560,460
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Van der Moolen Holding NV 59,637 321,057
-------------
1,326,038
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INSURANCE--6.1%
Aegon NV 67,569 847,656
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Aksigorta AS 30,012 94,037
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Fondiaria-Sai SpA 50,941 1,019,101
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Swiss Reinsurance Co. 13,624 903,379
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2,864,173
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HEALTH CARE--11.6%
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HEALTH CARE EQUIPMENT & SUPPLIES--1.8%
Sysmex Corp. 15,300 850,730
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HEALTH CARE PROVIDERS & SERVICES--2.3%
Mediceo Holdings Co. Ltd. 85,800 1,075,262
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PHARMACEUTICALS--7.5%
China Pharmaceutical Group Ltd. 1,870,000 393,422
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GlaxoSmithKline plc 2 49,257 1,239,817
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Sanofi-Aventis SA 8,750 774,818
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Takeda Pharmaceutical Co. Ltd. 11,900 579,962
- --------------------------------------------------------------------------------
UCB SA 11,400 554,719
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3,542,738
15 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF INVESTMENTS Continued
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VALUE
SHARES SEE NOTE 1
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INDUSTRIALS--12.1%
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AEROSPACE & DEFENSE--0.9%
Sagem SA 21,466 $ 441,779
- --------------------------------------------------------------------------------
AIRLINES--3.0%
Deutsche Lufthansa AG 1 22,481 291,383
- --------------------------------------------------------------------------------
easyJet plc 1 265,317 1,105,522
-------------
1,396,905
- --------------------------------------------------------------------------------
BUILDING PRODUCTS--0.7%
Royal Group Technologies Ltd. 1 32,200 307,337
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--2.5%
Bacou-Dalloz SA 6,740 598,292
- --------------------------------------------------------------------------------
Quebecor World, Inc. 26,900 595,379
-------------
1,193,671
- --------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--3.2%
Okumura Corp. 80,000 495,811
- --------------------------------------------------------------------------------
Technical Olympic SA 71,200 417,568
- --------------------------------------------------------------------------------
Vinci 3,865 580,697
-------------
1,494,076
- --------------------------------------------------------------------------------
ELECTRICAL EQUIPMENT--1.6%
Alstom 388,880 300,259
- --------------------------------------------------------------------------------
RHJ International Ltd. 1 18,337 467,221
-------------
767,480
- --------------------------------------------------------------------------------
INDUSTRIAL CONGLOMERATES--0.2%
Alarko Holding AS 1 4,267 114,226
- --------------------------------------------------------------------------------
Information Technology--10.3%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--2.7%
Nokia Oyj 58,900 941,264
- --------------------------------------------------------------------------------
SunCorp Technologies Ltd. 956,000 319,919
-------------
1,261,183
- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--1.1%
Japan Digital Laboratory Co. Ltd. 40,800 507,811
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--2.8%
Grande Holdings Ltd. (The) 402,000 377,709
- --------------------------------------------------------------------------------
Nichicon Corp. 48,700 634,470
- --------------------------------------------------------------------------------
Tohoku Pioneer Corp. 24,200 327,613
-------------
1,339,792
- --------------------------------------------------------------------------------
INTERNET SOFTWARE & SERVICES--2.4%
Jupiter Telecommunications Co. Ltd. 1 1,397 1,112,537
- --------------------------------------------------------------------------------
OFFICE ELECTRONICS--1.3%
Canon, Inc. 12,200 637,635
- --------------------------------------------------------------------------------
Materials--1.9%
- --------------------------------------------------------------------------------
CHEMICALS--0.8%
Metallgesellschaft AG 1 32,724 363,251
VALUE
SHARES SEE NOTE 1
- --------------------------------------------------------------------------------
METALS & MINING--1.1%
Arcelor 26,750 $ 541,462
- --------------------------------------------------------------------------------
Telecommunication Services--7.9%
- --------------------------------------------------------------------------------
DIVERSIFIED TELECOMMUNICATION SERVICES--5.1%
Cable & Wireless plc 250,865 575,222
- --------------------------------------------------------------------------------
France Telecom SA 28,691 839,216
- --------------------------------------------------------------------------------
Maroc Telecom 1 27,260 264,851
- --------------------------------------------------------------------------------
Telecom Italia SpA 97,700 275,405
- --------------------------------------------------------------------------------
Telefonos de Mexico SA de CV, Cl. L 244,300 414,349
-------------
2,369,043
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--2.8%
KDDI Corp. 157 726,228
- --------------------------------------------------------------------------------
Tim Hellas Telecommunications SA,
Sponsored ADR 29,200 601,520
-------------
1,327,748
- --------------------------------------------------------------------------------
UTILITIES--1.0%
- --------------------------------------------------------------------------------
MULTI-UTILITIES & UNREGULATED POWER--1.0%
Veolia Environnement SA 12,675 477,879
-------------
Total Common Stocks (Cost $42,840,974) 43,905,886
PRINCIPAL
AMOUNT
- --------------------------------------------------------------------------------
NON-CONVERTIBLE CORPORATE BONDS AND NOTES--0.8%
- --------------------------------------------------------------------------------
Zurich Reinsurance Centre Holdings,
Inc., 7.125% Sr. Nts., 10/15/23
(Cost $268,535) $ 500,000 390,000
UNITS
- --------------------------------------------------------------------------------
RIGHTS, WARRANTS AND CERTIFICATES--0.0%
- --------------------------------------------------------------------------------
JM AB Rts., Exp. 5/5/19 1 (Cost $0) 6,596 5,691
PRINCIPAL
AMOUNT
- --------------------------------------------------------------------------------
JOINT REPURCHASE AGREEMENTS--3.7%
- --------------------------------------------------------------------------------
Undivided interest of 0.13% in joint repurchase
agreement (Principal Amount/Value $1,318,039,000,
with a maturity value of $1,318,355,329) with UBS
Warburg LLC, 2.88%, dated 4/29/05, to be repurchased
at $1,725,414 on 5/2/05, collateralized by Federal
National Mortgage Assn., 5%--6%, 3/1/34--8/1/34,
with a value of $1,345,611,059 (Cost $1,725,000) $1,725,000 1,725,000
- --------------------------------------------------------------------------------
TOTAL INVESTMENTS, AT VALUE
(COST $44,834,509) 97.7% 46,026,577
- --------------------------------------------------------------------------------
OTHER ASSETS NET OF LIABILITIES 2.3 1,064,707
--------------------------
NET ASSETS 100.0% $ 47,091,284
==========================
16 | OPPENHEIMER INTERNATIONAL VALUE FUND
FOOTNOTES TO STATEMENT OF INVESTMENTS
1. Non-income producing security.
2. A sufficient amount of securities has been designated to cover outstanding
foreign currency contracts. See Note 5 of Notes to Financial Statements.
DISTRIBUTION OF INVESTMENTS REPRESENTING GEOGRAPHIC HOLDINGS, AS A PERCENTAGE OF
TOTAL INVESTMENTS AT VALUE, IS AS FOLLOWS:
GEOGRAPHIC HOLDINGS VALUE PERCENT
- ------------------------------------------------------------
Japan $ 10,234,298 22.2%
France 6,839,058 14.9
United Kingdom 6,488,506 14.1
Germany 2,655,869 5.8
The Netherlands 2,558,843 5.6
Italy 2,198,340 4.8
United States 2,115,000 4.6
Switzerland 1,777,951 3.9
Canada 1,576,284 3.4
Belgium 1,441,598 3.1
Ireland 1,199,932 2.6
Hong Kong 1,091,050 2.4
Greece 1,019,088 2.2
Finland 941,264 2.0
Sweden 785,467 1.7
Mexico 614,452 1.3
Norway 552,009 1.2
Denmark 546,212 1.2
Luxembourg 541,462 1.2
Korea, Republic of South 376,780 0.8
Morocco 264,851 0.6
Turkey 208,263 0.4
---------------------------
Total $ 46,026,577 100.0%
===========================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
17 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES April 30, 2005
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
ASSETS
- --------------------------------------------------------------------------------------------------------
Investments, at value (cost $44,834,509)--see accompanying statement of investments $ 46,026,577
- --------------------------------------------------------------------------------------------------------
Cash 100,242
- --------------------------------------------------------------------------------------------------------
Unrealized appreciation on foreign currency contracts 111,529
- --------------------------------------------------------------------------------------------------------
Receivables and other assets:
Investments sold 1,056,788
Shares of beneficial interest sold 975,787
Interest and dividends 126,246
Other 4,445
---------------
Total assets 48,401,614
- --------------------------------------------------------------------------------------------------------
LIABILITIES
- --------------------------------------------------------------------------------------------------------
Unrealized depreciation on foreign currency contracts 7,985
- --------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 1,160,145
Shares of beneficial interest redeemed 93,407
Shareholder communications 10,782
Distribution and service plan fees 7,657
Transfer and shareholder servicing agent fees 6,676
Trustees' compensation 244
Other 23,434
---------------
Total liabilities 1,310,330
- --------------------------------------------------------------------------------------------------------
NET ASSETS $ 47,091,284
===============
- --------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- --------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest $ 3,275
- --------------------------------------------------------------------------------------------------------
Additional paid-in capital 45,576,104
- --------------------------------------------------------------------------------------------------------
Accumulated net investment loss (55,990)
- --------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and foreign currency transactions 271,290
- --------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation of assets and liabilities
denominated in foreign currencies 1,296,605
---------------
NET ASSETS $ 47,091,284
===============
- --------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- --------------------------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets of $29,830,568
and 2,066,729 shares of beneficial interest outstanding) $ 14.43
Maximum offering price per share (net asset value plus sales charge of 5.75% of
offering price) $ 15.31
- --------------------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales
charge) and offering price per share
(based on net assets of $7,695,241 and 538,750 shares of beneficial
interest outstanding) $ 14.28
- --------------------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent deferred sales
charge) and offering price per share
(based on net assets of $9,565,475 and 669,751 shares of beneficial interest
outstanding) $ 14.28
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
18 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF OPERATIONS For the Year Ended April 30, 2005
- --------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------
INVESTMENT INCOME
- ----------------------------------------------------------------------------------------
Dividends (net of foreign withholding taxes of $34,911) $ 355,458
- ----------------------------------------------------------------------------------------
Interest 42,169
------------
Total investment income 397,627
- ----------------------------------------------------------------------------------------
EXPENSES
- ----------------------------------------------------------------------------------------
Management fees 130,587
- ----------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A 19,446
Class B 18,871
Class C 23,034
- ----------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 16,416
Class B 5,801
Class C 4,929
- ----------------------------------------------------------------------------------------
Shareholder communications:
Class A 8,940
Class B 4,251
Class C 3,155
- ----------------------------------------------------------------------------------------
Legal, auditing and other professional fees 28,959
- ----------------------------------------------------------------------------------------
Trustees' compensation 8,595
- ----------------------------------------------------------------------------------------
Custodian fees and expenses 4,535
- ----------------------------------------------------------------------------------------
Other 13,260
------------
Total expenses 290,779
Less reduction to custodian expenses (177)
Less waivers and reimbursements of expenses (13,988)
------------
Net expenses 276,614
- ----------------------------------------------------------------------------------------
NET INVESTMENT INCOME 121,013
- ----------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN
- ----------------------------------------------------------------------------------------
Net realized gain on:
Investments 444,343
Foreign currency transactions 137,428
------------
Net realized gain 581,771
- ----------------------------------------------------------------------------------------
Net change in unrealized appreciation on:
Investments 54,873
Translation of assets and liabilities denominated in foreign currencies 33,236
------------
Net change in unrealized appreciation 88,109
- ----------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 790,893
============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
19 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
YEAR ENDED APRIL 30, 2005 2004 1
- ------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
- ------------------------------------------------------------------------------------------------------------------------------
Net investment income $ 121,013 $ 6,564
- ------------------------------------------------------------------------------------------------------------------------------
Net realized gain 581,771 357,446
- ------------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation 88,109 1,208,496
-----------------------------
Net increase in net assets resulting from operations 790,893 1,572,506
- ------------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ------------------------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A (504,505) (25,177)
Class B (104,500) --
Class C (113,577) --
- ------------------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets resulting from beneficial interest transactions:
Class A 22,890,596 5,105,499
Class B 7,739,035 --
Class C 9,640,514 --
- ------------------------------------------------------------------------------------------------------------------------------
NET ASSETS
- ------------------------------------------------------------------------------------------------------------------------------
Total increase 40,338,456 6,652,828
- ------------------------------------------------------------------------------------------------------------------------------
Beginning of period 6,752,828 100,000 2
-----------------------------
End of period (including accumulated net investment loss of $55,990 and $70,436, respectively) $ 47,091,284 $ 6,752,828
=============================
1. For the period from August 1, 2003 (commencement of operations) to April 30,
2004.
2. Reflects the value of the Manager's initial seed money investment on July 16,
2003.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
20 | OPPENHEIMER INTERNATIONAL VALUE FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
CLASS A YEAR ENDED APRIL 30, 2005 2004 1
- -----------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 12.98 $ 10.00
- -----------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .15 2 .01
Net realized and unrealized gain 2.10 3.02
----------------------------
Total from investment operations 2.25 3.03
- -----------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain (.80) (.05)
- -----------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 14.43 $ 12.98
============================
- -----------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 17.74% 30.35%
- -----------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 29,831 $ 6,753
- -----------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 11,186 $ 6,126
- -----------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 1.05% 0.14%
Total expenses 1.63% 2.13%
Expenses after payments and waivers and reduction to custodian expenses 1.54% 1.70%
- -----------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 60% 30%
1. For the period from August 1, 2003 (commencement of operations) to April 30,
2004.
2. Per share amounts calculated based on the average shares outstanding during
the period.
3. Assumes an investment at net asset value on the business day before the first
day of the fiscal period, with all dividends and distributions reinvested in
additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns. Total returns are not annualized for
periods of less than one full year. Returns do not reflect the deduction of
taxes a shareholder would pay on Fund distributions or the redemption of Fund
shares.
4. Annualized for periods of less than one full year.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
21 | OPPENHEIMER INTERNATIONAL VALUE FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
PERIOD ENDED APRIL 30, 2005 1 Class B Class C
- ------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 12.99 $ 12.99
- ------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .01 2 .02 2
Net realized and unrealized gain 2.08 2.07
-----------------------------
Total from investment operations 2.09 2.09
- ------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Distributions from net realized gain (.80) (.80)
- ------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 14.28 $ 14.28
=============================
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 16.47% 16.47%
- ------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 7,695 $ 9,565
- ------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 1,997 $ 2,364
- ------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 0.04% 0.12%
Total expenses 2.59% 2.44%
Expenses after payments and waivers and reduction to custodian expenses 2.45% 2.41%
- ------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 60% 60%
1. For the period from May 6, 2004 (inception of offering) to April 30, 2005.
2. Per share amounts calculated based on the average shares outstanding during
the period.
3. Assumes an investment at net asset value on the business day before the first
day of the fiscal period, with all dividends and distributions reinvested in
additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Sales charges
are not reflected in the total returns. Total returns are not annualized for
periods of less than one full year. Returns do not reflect the deduction of
taxes a shareholder would pay on Fund distributions or the redemption of Fund
shares.
4. Annualized for periods of less than one full year.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
22 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer International Value Fund (the Fund), a series of Oppenheimer
International Value Trust, is an open-end management investment company
registered under the Investment Company Act of 1940, as amended. The Fund's
investment objective is to seek long-term capital appreciation. The Fund's
investment advisor is OppenheimerFunds, Inc. (the Manager).
The Fund offers Class A, Class B and Class C shares. Class A shares are
sold at their offering price, which is normally net asset value plus a front-end
sales charge. Class B and Class C shares are sold without a front-end sales
charge but may be subject to a contingent deferred sales charge (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 due
to each class having its own expenses, such as transfer and shareholder
servicing agent fees and shareholder communications, directly attributable to
that class. Classes A, B and C have separate distribution and/or service plans.
Class B shares will automatically convert to Class A shares six years after the
date of purchase. The Fund assesses a 2% fee on the proceeds of fund shares that
are redeemed (either by selling or exchanging to another Oppenheimer fund)
within 30 days of their purchase. The fee, which is retained by the Fund, is
accounted for as an addition to paid-in capital.
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.
Corporate, government and municipal debt instruments having a remaining maturity
in excess of sixty days and all mortgage-backed securities will be valued at the
mean between the "bid" and "asked" prices. Futures contracts traded on a
commodities or futures exchange will be valued at the final settlement price or
official closing price on the principal exchange as reported by such principal
exchange at its trading session ending at, or most recently prior to, the time
when the Fund's assets are valued. Securities may be valued primarily using
dealer-supplied valuations or a portfolio pricing service authorized by the
Board of Trustees. Securities (including restricted securities) for which market
quotations are not readily available are valued at their fair value. Foreign and
domestic 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 exchanges will be fair valued.
Fair value is determined in good faith using consistently applied procedures
under the supervision of the Board of Trustees. Short-term "money market type"
debt securities with remaining maturities of sixty days or less are valued at
amortized cost (which approximates market value).
- --------------------------------------------------------------------------------
FOREIGN CURRENCY TRANSLATION. The Fund's accounting records are maintained in
U.S. dollars. The values of securities denominated in foreign currencies and
amounts related to the purchase and sale of foreign securities and foreign
investment income are translated into U.S. dollars 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. Foreign exchange rates may be valued
primarily using dealer supplied valuations or a portfolio pricing service
authorized by the Board of Trustees.
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.
23 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
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.
The tax components of capital shown in the table below represent distribution
requirements the Fund must satisfy under the income tax regulations, losses the
Fund may be able to offset against income and gains realized in future years and
unrealized appreciation or depreciation of securities and other investments for
federal income tax purposes.
NET UNREALIZED
APPRECIATION
BASED ON COST OF
SECURITIES AND
UNDISTRIBUTED UNDISTRIBUTED ACCUMULATED OTHER INVESTMENTS
NET INVESTMENT LONG-TERM LOSS FOR FEDERAL INCOME
INCOME GAIN CARRYFORWARD 1,2 TAX PURPOSES
-------------------------------------------------------------------------
$ 298,610 $ 108,234 $ -- $ 1,208,607
1. During the fiscal year ended April 30, 2005, the Fund did not utilize any
capital loss carryforward.
2. During the fiscal year ended April 30, 2004, the Fund did not utilize any
capital loss carryforward.
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 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. Accordingly, the
following amounts have been reclassified for April 30, 2005. Net assets of the
Fund were unaffected by the reclassifications.
REDUCTION TO INCREASE TO
ACCUMULATED ACCUMULATED NET
INCREASE TO NET INVESTMENT REALIZED GAIN
PAID-IN CAPITAL INCOME ON INVESTMENTS 3
-----------------------------------------------------------
$ 103,735 $ 106,567 $ 2,832
3. $103,735, including $37,831 of long-term capital gain, was distributed in
connection with Fund share redemptions.
24 | OPPENHEIMER INTERNATIONAL VALUE FUND
The tax character of distributions paid during the year ended April 30, 2005
and the period ended April 30, 2004 was as follows:
YEAR ENDED PERIOD ENDED
APRIL 30, 2005 APRIL 30. 2004 4
-------------------------------------------------------------------------
Distributions paid from:
Ordinary income $ 584,116 $ 25,177
Long-term capital gain 138,466 --
--------------------------------
Total $ 722,582 $ 25,177
================================
4. For the period from August 1, 2003 (commencement of operations) to April 30,
2004.
The aggregate cost of securities and other investments and the composition of
unrealized appreciation and depreciation of securities and other investments for
federal income tax purposes as of April 30, 2005 are noted below. The primary
difference between book and tax appreciation or depreciation of securities and
other investments, if applicable, is attributable to the tax deferral of losses
or tax realization of financial statement unrealized gain or loss.
Federal tax cost of securities $ 44,922,506
Federal tax cost of other investments (8,217,953)
--------------
Total federal tax cost $ 36,704,553
==============
Gross unrealized appreciation $ 2,551,976
Gross unrealized depreciation (1,343,369)
--------------
Net unrealized appreciation $ 1,208,607
==============
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.
- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.
- --------------------------------------------------------------------------------
CUSTODIAN FEES. Custodian Fees and Expenses in the Statement of Operations may
include interest expense incurred by the Fund on any cash overdrafts of its
custodian account during the period. Such cash overdrafts may result from the
effects of failed trades in portfolio securities and from cash outflows
resulting from unanticipated shareholder redemption activity. The Fund pays
interest to its custodian on such cash overdrafts at a rate equal to the Federal
Funds Rate plus 0.50%. The Reduction to Custodian Expenses line item, if
applicable, represents earnings on cash balances maintained by the Fund during
the period. Such interest expense and other custodian fees may be paid with
these earnings.
- --------------------------------------------------------------------------------
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.
25 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follow:
YEAR ENDED APRIL 30, 2005 1 PERIOD ENDED APRIL 30, 2004 2,3
SHARES AMOUNT SHARES AMOUNT
- --------------------------------------------------------------------------------------------------------------
CLASS A
Sold 2,140,742 $ 30,773,644 510,303 $ 5,105,000
Dividends and/or distributions reinvested 35,246 477,946 44 499
Redeemed (629,606) (8,360,994)4 -- --
--------------------------------------------------------------
Net increase 1,546,382 $ 22,890,596 510,347 $ 5,105,499
==============================================================
- --------------------------------------------------------------------------------------------------------------
CLASS B
Sold 567,619 $ 8,158,768 -- $ --
Dividends and/or distributions reinvested 6,829 92,060 -- --
Redeemed (35,698) (511,793)4 -- --
--------------------------------------------------------------
Net increase 538,750 $ 7,739,035 -- $ --
==============================================================
- --------------------------------------------------------------------------------------------------------------
CLASS C
Sold 686,044 $ 9,883,409 -- $ --
Dividends and/or distributions reinvested 7,989 107,612 -- --
Redeemed (24,282) (350,507)4 -- --
--------------------------------------------------------------
Net increase 669,751 $ 9,640,514 -- $ --
==============================================================
1. For the year ended April 30, 2005, for Class A shares and for the period from
May 6, 2004 (inception of offering) to April 30, 2005, for Class B and Class C
shares.
2. For the period from August 1, 2003 (commencement of operations) to April 30,
2004.
3. The Fund sold 10,000 shares to the Manager upon seeding of the Fund on July
16, 2003.
4. Net of redemption fees of $2,106, $376 and $445 for Class A, Class B and
Class C, respectively.
- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations, for the year ended April 30, 2005, were $46,606,047
and $9,610,900, 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 0.85% of the first $500 million of average annual net assets of
the Fund, 0.75% of the next $500 million, and 0.70% of average annual net assets
in excess of $1 billion.
- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the year ended April 30, 2005, the Fund paid $20,459
to OFS for services to the Fund.
- --------------------------------------------------------------------------------
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 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
26 | OPPENHEIMER INTERNATIONAL VALUE FUND
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 AND CLASS C SHARES. The Fund has
adopted Distribution and Service Plans for Class B and Class C 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% on Class B and Class C
shares. The Distributor also receives a service fee of 0.25% per year under each
plan. If either the Class B or Class C plan is terminated by the Fund or by the
shareholders of a class, the Board of Trustees and its independent trustees 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, 2005
for Class B and Class C shares were $24,083 and $51,709, 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.
CLASS A CLASS A CLASS B CLASS C
FRONT-END CONTINGENT DEFERRED CONTINGENT DEFERRED CONTINGENT DEFERRED
SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES
RETAINED BY RETAINED BY RETAINED BY RETAINED BY
YEAR ENDED DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR
- ---------------------------------------------------------------------------------------------------------
April 30, 2005 $ 76,799 $ -- $ 3,771 $ 518
- --------------------------------------------------------------------------------
WAIVERS AND REIMBURSEMENTS OF EXPENSES. The Manager has voluntarily agreed to
waive management fees and/or reimburse the Fund for certain expenses so that
"Total Annual Operating Expenses" will not exceed 1.70% for Class A shares,
2.45% for Class B shares and Class C shares. During the year ended April 30,
2005, the Manager reimbursed the Fund $10,605, $2,668 and $698 for Class A,
Class B and Class C shares, respectively. The voluntary waiver and/or expense
reimbursements may be amended or withdrawn at any time without prior notice to
shareholders.
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.
During the year ended April 30, 2005, OFS waived $3 and $14 for Class A and
Class B shares, respectively. This undertaking may be amended or withdrawn at
any time.
- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS
A foreign currency contract is a commitment to purchase or sell a foreign
currency at a future date, at a negotiated rate. The Fund may enter into foreign
currency contracts to settle specific purchases or sales of securities
denominated in a foreign currency and for protection from adverse exchange rate
fluctuation. Risks to the Fund include the potential inability of the
counterparty to meet the terms of the contract.
The net U.S. dollar value of foreign currency underlying all contractual
commitments held by the Fund and the resulting unrealized appreciation or
depreciation are determined using prevailing foreign currency exchange rates.
Unrealized appreciation and depreciation on foreign currency contracts are
reported in the Statement of Assets and Liabilities as a receivable or payable
and in the Statement of Operations with the change in unrealized appreciation or
depreciation.
The Fund may realize a gain or loss upon the closing or settlement of the
foreign transaction. Contracts closed or settled with the same broker are
recorded as net realized gains or losses. Such realized gains and losses are
reported with all other foreign currency gains and losses in the Statement of
Operations.
27 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
5. FOREIGN CURRENCY CONTRACTS Continued
As of April 30, 2005, the Fund had outstanding foreign currency contracts as
follows:
EXPIRATION CONTRACT AMOUNT VALUATION AS OF UNREALIZED UNREALIZED
CONTRACT DESCRIPTION DATES (000S) APRIL 30, 2005 APPRECIATION DEPRECIATION
- --------------------------------------------------------------------------------------------------------------------
CONTRACTS TO PURCHASE
Japanese Yen [JPY] 5/6/05 2,442JPY $ 23,307 $ 187 $ --
-----------------------------
CONTRACTS TO SELL
British Pound Sterling [GBP] 5/4/05 343GBP 654,921 206 --
Euro [EUR] 6/21/05 4,900EUR 6,313,913 107,308 --
Japanese Yen [JPY] 6/21/05 122,000JPY 1,168,883 3,828 7,985
-----------------------------
111,342 7,985
-----------------------------
Total unrealized appreciation and depreciation $ 111,529 $ 7,985
=============================
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6. LITIGATION
A consolidated amended complaint has been filed as putative derivative and class
actions against the Manager, OFS and the Distributor, as well as 51 of the
Oppenheimer funds (as "Nominal Defendants") including the Fund, 30 present and
former Directors or Trustees and 8 present and former officers of the funds.
This complaint, initially filed in the U.S. District Court for the Southern
District of New York on January 10, 2005 and amended on March 4, 2005,
consolidates into a single action and amends six individual previously-filed
putative derivative and class action complaints. Like those prior complaints,
the complaint alleges that the Manager charged excessive fees for distribution
and other costs, improperly used assets of the funds in the form of directed
brokerage commissions and 12b-1 fees to pay brokers to promote sales of the
funds, and failed to properly disclose the use of assets of the funds to make
those payments in violation of the Investment Company Act of 1940 and the
Investment Advisers Act of 1940. Also, like those prior complaints, the
complaint further alleges that by permitting and/or participating in those
actions, the Directors/Trustees and the Officers breached their fiduciary duties
to shareholders of the funds under the Investment Company Act of 1940 and at
common law. The complaint seeks unspecified compensatory and punitive damages,
rescission of the funds' investment advisory agreements, an accounting of all
fees paid, and an award of attorneys' fees and litigation expenses.
The defendants believe that the allegations contained in the Complaints
are without merit and that they have meritorious defenses against the claims
asserted. The defendants intend to defend these lawsuits vigorously and to
contest any claimed liability. The defendants believe that it is premature to
render any opinion as to the likelihood of an outcome unfavorable to them and
that no estimate can yet be made with any degree of certainty as to the amount
or range of any potential loss.
28 | OPPENHEIMER INTERNATIONAL VALUE FUND
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCONTING FIRM
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TO THE SHAREHOLDERS AND BOARD OF TRUSTEES OF OPPENHEIMER INTERNATIONAL VALUE
FUND
We have audited the accompanying statement of assets and liabilities of
Oppenheimer International Value Fund (the sole fund constituting the Oppenheimer
International Value Trust) (the "Fund"), including the statement of investments,
as of April 30, 2005, and the related statements of operations for the year then
ended, the statements of changes in net assets for the year then ended and for
the period from August 1, 2003 (commencement of operations) to April 30, 2004
and the financial highlights for each of the periods indicated therein. These
financial statements and financial highlights are the responsibility of the
Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
We were not engaged to perform an audit of the Fund's internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Fund's internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of securities owned
as of April 30, 2005, by correspondence with the custodian and others. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of
Oppenheimer International Value Fund of the Oppenheimer International Value
Trust at April 30, 2005, the results of its operations for the year then ended,
the statements of changes in net assets for the year then ended and for the
period from August 1, 2003 (commencement of operations) to April 30, 2004 and
the financial highlights for each of the periods indicated therein in conformity
with U.S. generally accepted accounting principles.
/s/ Ernst & Young LLP
New York, New York
May 26, 2005
29 | OPPENHEIMER INTERNATIONAL VALUE FUND
FEDERAL INCOME TAX INFORMATION Unaudited
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- --------------------------------------------------------------------------------
In early 2006, if applicable, shareholders of record will receive information
regarding all dividends and distributions paid to them by the Fund during
calendar year 2005. Regulations of the U.S. Treasury Department require the Fund
to report this information to the Internal Revenue Service.
Distributions of $0.8016 per share were paid to Class A, Class B and Class
C shareholders, respectively, on December 9, 2004, of which $0.1536 was
designated as a "capital gain distribution" for federal income tax purposes.
Whether received in stock or in cash, the capital gain distribution should be
treated by shareholders as a gain from the sale of the capital assets held for
more than one year (long-term capital gains).
A portion, if any, of the dividends paid by the Fund during the fiscal
year ended April 30, 2005 which are not designated as capital gain distributions
are eligible for lower individual income tax rates to the extent that the Fund
has received qualified dividend income as stipulated by recent tax legislation.
$301,936 of the Fund's fiscal year taxable income may be eligible for the lower
individual income tax rates. In early 2006, shareholders of record will receive
information regarding the percentage of distributions that are eligible for
lower individual income tax rates.
The Fund has elected the application of Section 853 of the Internal
Revenue Code to permit shareholders to take a federal income tax credit or
deduction, at their option, on a per share basis for an aggregate amount of
$35,524 of foreign income taxes paid by the Fund during the fiscal year ended
April 30, 2005. A separate notice will be mailed to each shareholder, which will
reflect the proportionate share of such foreign taxes which must be treated by
shareholders as gross income for federal income tax purposes.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Fund to the Internal Revenue Service. Because of
the complexity of the federal regulations which may affect your individual tax
return and the many variations in state and local tax regulations, we recommend
that you consult your tax advisor for specific guidance.
30 | OPPENHEIMER INTERNATIONAL VALUE FUND
PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES;
UPDATES TO STATEMENTS OF INVESTMENTS Unaudited
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- --------------------------------------------------------------------------------
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
1.800.525.7048, (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 is required to
file 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 Fund's voting record is
available (i) without charge, upon request, by calling the Fund toll-free at
1.800.525.7048, and (ii) in the Form N-PX filing on the SEC's website at
www.sec.gov.
The Fund files its complete schedule of portfolio holdings with the SEC
for the first quarter and the third quarter of each fiscal year on Form N-Q. The
Fund's Form N-Q filings are available on the SEC's website at
http://www.sec.gov. Those forms may be reviewed and copied at the SEC's Public
Reference Room in Washington D.C. Information on the operation of the Public
Reference Room may be obtained by calling 1-800-SEC-0330.
31 | OPPENHEIMER INTERNATIONAL VALUE FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited
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- --------------------------------------------------------------------------------
Each year, the Board of Trustees (the "Board"), including a majority of the
independent Trustees, is required to determine whether to renew the advisory
agreement. The Investment Company Act of 1940, as amended, requires that the
Board request and evaluate, and that the Manager provide, such information as
may be reasonably necessary to evaluate the terms of the advisory agreement. The
Board employs an independent consultant to prepare a report that provides
information, including comparative information, that the Board requests for this
purpose. In addition, the Board receives information throughout the year
regarding Fund services, fees, expenses and performance.
NATURE AND EXTENT OF SERVICES. In considering the renewal of the Fund's
advisory agreement for the current year, the Board evaluated the nature and
extent of the services provided by the Manager and its affiliates. The Manager
provides the Fund with office space, facilities and equipment; administrative,
accounting, clerical, legal and compliance personnel; securities trading
services; oversight of third party service providers and the services of the
portfolio manager and the Manager's investment team, who provide research,
analysis and other advisory services in regard to the Fund's investments.
QUALITY OF SERVICES. The Board also considered the quality of the services
provided and the quality of the Manager's resources that are available to the
Fund. The Board noted that the Manager has had over forty years of experience as
an investment adviser and that its assets under management rank it among the top
mutual fund managers in the United States. The Board evaluated the Manager's
administrative, accounting, legal and compliance services and information the
Board received regarding the experience and professional qualifications of the
Manager's personnel and the size and functions of its staff. The Board members
also considered their experiences as directors or trustees of the Fund and other
funds advised by the Manager. The Board received and reviewed information
regarding the quality of services provided by affiliates of the Manager, which
it also reviews at other times during the year in connection with the renewal of
the Fund's service agreements. The Board noted that the relatively low
redemption rate for funds advised by the Manager provided an indication of
shareholder satisfaction with the overall level of services provided by the
Manager.
PORTFOLIO MANAGEMENT SERVICES AND PERFORMANCE. In its evaluation of the
quality of the portfolio management services provided, the Board considered the
experience of Dominic Freud and the Manager's Global investment team and
analysts. Mr. Freud has had over 24 years of experience managing equity
investments and has been primarily responsible for the day-to-day management of
the Fund's portfolio since the Fund's inception in August 2003. Mr. Freud has
been a Vice President of the Manager since April 2003 and was a Partner and
European Equity Portfolio Manager at SLS Management from January 2002 through
February 2003, and head of the European equities desk and managing director at
SG Cowen from May 1994 through January 2002. He is an officer of 2 portfolios in
the OppenheimerFunds complex.
The Board reviewed information, prepared by the Manager and by the
independent consultant, comparing the Fund's historical performance to relevant
market indices and to the performance of other international multi-cap value
funds (including both funds advised by the Manager and funds advised by other
investment advisers). The Board also receives and reviews comparative
performance information regarding the Fund and other funds at each Board
meeting. The Board noted that the Fund's one-year performance was below its peer
group average. However, its performance since inception was better than its peer
group average.
MANAGEMENT FEES AND EXPENSES. The Board also reviewed information,
including comparative information, regarding the fees paid to the Manager and
its affiliates and the other expenses borne by the Fund. The independent
consultant provided comparative data in regard to the fees and expenses of the
Fund, other international multi-cap
32 | OPPENHEIMER INTERNATIONAL VALUE FUND
value funds, international multi-cap core funds and international large-cap
value funds and other funds with comparable assets levels and distribution
features. The Manager has agreed to voluntarily cap expenses at 1.70% for Class
A shares, 2.45% for Class B and Class C shares, 1.95% for Class N shares and
1.45% for Class Y shares. The Board noted that the Fund's contractual and actual
management fees are both lower than its peer group average although its total
expenses are higher than its peer group average. In addition, the Board
evaluated the comparability of the fees charged and the services provided to the
Fund to the fees charged and services provided to other types of entities
advised by the Manager.
PROFITABILITY OF THE MANAGER AND AFFILIATES. The Board also reviewed
information regarding the cost of services provided by the Manager and its
affiliates and the Manager's profitability. The Board considered that the
Manager must be able to pay and retain experienced professional personnel at
competitive rates to provide services to the Fund and that maintaining the
financial viability of the Manager is important in order for the Manager to
continue to provide significant services to the Fund and its shareholders. In
addition the Board considered information that was provided regarding the direct
and indirect benefits the Manager receives as a result of its relationship with
the Fund, including compensation paid to the Manager's affiliates and research
provided to the Manager in connection with permissible brokerage arrangements
(soft dollar arrangements).
ECONOMIES OF SCALE. The Board reviewed the extent to which the Manager may
realize economies of scale in managing and supporting the Fund and the current
level of Fund assets in relation to the Fund's breakpoint schedule for its
management fees. The Board noted that the fund has not experienced any asset
growth recently and that, based on current asset levels, the Fund is not yet
approaching its last management fee breakpoint.
CONCLUSIONS. These factors were also considered by the independent
Trustees meeting separately from the full Board, assisted by experienced counsel
to the Fund. Fund counsel is independent of the Manager within the meaning and
intent of the Securities and Exchange Commission Rules. The Board was aware that
there are alternatives to retaining the Manager.
Based on its review of the information it received and its evaluations
described above, the Board, including a majority of the independent Trustees,
concluded that the nature, extent and quality of the services provided to the
Fund by the Manager are a benefit to the Fund and in the best interest of the
Fund's shareholders and that the amount and structure of the compensation
received by the Manager and its affiliates are reasonable in relation to the
services provided. Accordingly, the Board elected to continue the investment
advisory agreement for another year. In arriving at this decision, the Board did
not single out any factor or factors as being more important than others, but
considered all of the factors together. The Board judged the terms and
conditions of the advisory agreement, including the management fee, in light of
all of the surrounding circumstances.
33 | OPPENHEIMER INTERNATIONAL VALUE FUND
TRUSTEES AND OFFICERS Unaudited
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NAME, POSITION(S) HELD WITH PRINCIPAL OCCUPATION(S) DURING PAST 5 YEARS; OTHER TRUSTEESHIPS/DIRECTORSHIPS HELD BY
FUND, LENGTH OF SERVICE, AGE TRUSTEE; NUMBER OF PORTFOLIOS IN FUND COMPLEX CURRENTLY OVERSEEN BY TRUSTEE
INDEPENDENT THE ADDRESS OF EACH TRUSTEE AND INTERESTED TRUSTEE IN THE CHARTS BELOW IS 6803 S. TUCSON
TRUSTEES WAY, CENTENNIAL, CO 80112-3924. EACH TRUSTEE SERVES FOR AN INDEFINITE TERM, UNTIL HIS OR
HER RESIGNATION, RETIREMENT, DEATH OR REMOVAL.
PETER I. WOLD, President of Wold Oil Properties, Inc. (oil and gas exploration and production company)
Chairman of the Board (since 1994); Vice President, Secretary and Treasurer of Wold Trona Company, Inc. (soda
(since December 2004), ash processing and production) (since 1996); Vice President of Wold Talc Company, Inc.
Trustee (since 2003) (talc mining) (since 1999); Managing Member of Hole-in-the- Wall Ranch (cattle ranching)
Age: 57 (since 1979); Director and Chairman of the Denver Branch of the Federal Reserve Bank of
Kansas City (1993-1999); and Director of PacifiCorp. (electric utility) (1995-1999).
Oversees 14 portfolios in the OppenheimerFunds complex.
RONALD J. ABDOW, Chairman of Abdow Corporation (operator of restaurants) (since 1959); Trustee of the
Trustee (since 2003) following real estate businesses (owners and operators of restaurants): G&R Realty Co.
Age: 73 (since 1973), G&R Trust Co. (since 1973), Abdow Partnership (since 1975), Auburn
Associates (since 1983) and Hazard Associates (since 1985); Trustee of the following
open-end investment companies: MML Series Investment Fund II (since 2005), MassMutual
Premier Funds (since 2004), MML Series Investment Fund (1993-2004) and of MassMutual
Select Funds (formerly MassMutual Institutional Funds) (1994-2004); Trustee of Bay State
Health System (health services) (since 1994); Chairman of Western Mass Development Corp.
(non-profit land development) (since 1996); and Chairman of American International
College (non-profit college) (since 1991). Oversees 14 portfolios in the OppenheimerFunds
complex.
JOSEPH M. WIKLER, Director of the following medical device companies: Medintec (since 1992) and Cathco
Trustee (since 2003) (since 1996); Director of Lakes Environmental Association (since 1996); Member of the
Age: 64 Investment Committee of the Associated Jewish Charities of Baltimore (since 1994);
Director of Fortis/Hartford mutual funds (1994 - December 2001). Oversees 14 portfolios
in the OppenheimerFunds complex.
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INTERESTED TRUSTEE
EUSTIS WALCOTT, Principal with Ardsley Associates (consulting firm) (since 2000); Director of Cornerstone
Trustee (since 2003) Real Estate Advisors LLC (real estate equity investment management services) (an
Age: 67 affiliate of the Manager) (since October 2000); Director of MML Investors Services
(individual retirement, insurance, investment, and life event planning products and
services company) (an affiliate of the Manager) (since October 2000); Trustee of OFI
Trust Company (an affiliate of the Manager) (since 2001); Trustee of the American
International College (1995 - December 2003); Senior Vice President of Massachusetts
Mutual Life Insurance Company (May 1990 - July 2000); Vice President of MassMutual
Foundation for Hartford, Inc. (since 2005). Oversees 14 portfolios in the
OppenheimerFunds complex.
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INTERESTED TRUSTEE THE ADDRESS OF MR. MURPHY IN THE CHART BELOW IS TWO WORLD FINANCIAL CENTER, 225 LIBERTY
AND OFFICER STREET, NEW YORK, NY 10281-1008. MR. MURPHY SERVES FOR AN INDEFINITE TERM, UNTIL HIS
RESIGNATION, DEATH OR REMOVAL.
JOHN V. MURPHY, Chairman, Chief Executive Officer and director (since June 2001) and President (since
President and Trustee September 2000) of the Manager; President and a director or trustee of other Oppenheimer
(since 2003) funds; President and a director (since July 2001) of Oppenheimer Acquisition Corp. (the
Age: 55 Manager's parent holding company) and of Oppenheimer Partnership Holdings, Inc. (a
holding company subsidiary of the Manager); a director (since November 2001) of
OppenheimerFunds Distributor, Inc. (a subsidiary of the Manager); Chairman and a director
(since July 2001) of Shareholder Services, Inc. and of Shareholder Financial Services,
Inc. (transfer agent subsidiaries of the Manager); President and a director (since July
2001) of OppenheimerFunds Legacy Program (a charitable trust program established by the
Manager); a director of the following investment advisory subsidiaries of the Manager:
OFI Institutional Asset Management, Inc., Centennial Asset Management Corporation,
Trinity Investment Management Corporation and Tremont Capital Management, Inc. (since
November 2001), HarbourView Asset Management Corporation and OFI Private Investments,
Inc. (since July 2001); President (since November 1, 2001) and a director (since July
2001) of Oppenheimer Real Asset Management, Inc.; Executive Vice President (since
February 1997) of Massachusetts Mutual Life Insurance Company (the Manager's parent
company); a director (since June 1995) of DLB Acquisition Corporation (a holding company
that owns the shares of Babson
34 | OPPENHEIMER INTERNATIONAL VALUE FUND
JOHN V. MURPHY, Capital Management LLC); a member of the Investment Company Institute's Board of
Continued Governors (elected to serve from October 3, 2003 through September 30, 2006). Formerly,
Chief Operating Officer (September 2000 - June 2001) of the Manager; President and trustee
(November 1999-November 2001) of MML Series Investment Fund and MassMutual Select Funds
(open-end investment companies); a director (September 1999-August 2000) of C.M. Life
Insurance Company; President, Chief Executive Officer and director (September 1999-August
2000) of MML Bay State Life Insurance Company; a director (June 1989-June 1998) of
Emerald Isle Bancorp and Hibernia Savings Bank (a wholly-owned subsidiary of Emerald Isle
Bancorp). Oversees 66 portfolios as Trustee/Director and 20 additional portfolios as
Officer in the OppenheimerFunds complex.
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OFFICERS THE ADDRESS OF THE OFFICERS IN THE CHART BELOW IS AS FOLLOWS: FOR MR. FREUD AND MR. ZACK,
TWO WORLD FINANCIAL CENTER, 225 LIBERTY STREET, NEW YORK, NY 10281-1008, FOR MR. WIXTED
AND MR. VANDEHEY, 6803 S. TUCSON WAY, CENTENNIAL, CO 80112-3924. EACH OFFICER SERVES FOR
AN ANNUAL TERM OR UNTIL HIS OR HER EARLIER RESIGNATION, DEATH OR REMOVAL.
DOMINIC FREUD, Vice President and Manager since April 2003. An officer of 1 portfolio in the
Vice President and OppenheimerFunds complex. Formerly, a Partner and European Equity Portfolio manager at
Portfolio Manager SLS Management (January 2002 - February 2003) prior to which he was head of the European
(since 2004) equities desk and managing director at SG Cowen (May 1994 - January 2002).
Age: 46
BRIAN W. WIXTED, Senior Vice President and Treasurer (since March 1999) of the Manager; Treasurer of
Treasurer (since 2003) HarbourView Asset Management Corporation, Shareholder Financial Services, Inc.,
Age: 45 Shareholder Services, Inc., Oppenheimer Real Asset Management Corporation, and
Oppenheimer Partnership Holdings, Inc. (since March 1999), of OFI Private Investments,
Inc. (since March 2000), of OppenheimerFunds International Ltd. and OppenheimerFunds plc
(since May 2000), of OFI Institutional Asset Management, Inc. (since November 2000), and
of OppenheimerFunds Legacy Program (a Colorado non-profit corporation) (since June 2003);
Treasurer and Chief Financial Officer (since May 2000) of OFI Trust Company (a trust
company subsidiary of the Manager; Assistant Treasurer (since March 1999) of Oppenheimer
Acquisition Corp. Formerly Assistant Treasurer of Centennial Asset Management Corporation
(March 1999-October 2003) and OppenheimerFunds Legacy Program (April 2000-June 2003);
Principal and Chief Operating Officer (March 1995-March 1999) at Bankers Trust
Company-Mutual Fund Services Division. An officer of 86 portfolios in the
OppenheimerFunds complex.
ROBERT G. ZACK, Executive Vice President (since January 2004) and General Counsel (since February 2002)
Secretary (since 2003) of the Manager; General Counsel and a director (since November 2001) of the Distributor;
Age: 56 General Counsel (since November 2001) of Centennial Asset Management Corporation; Senior
Vice President and General Counsel (since November 2001) of HarbourView Asset Management
Corporation; Secretary and General Counsel (since November 2001) of Oppenheimer
Acquisition Corp.; Assistant Secretary and a director (since October 1997) of
OppenheimerFunds International Ltd. and OppenheimerFunds plc; Vice President and a
director (since November 2001) of Oppenheimer Partnership Holdings, Inc.; a director
(since November 2001) of Oppenheimer Real Asset Management, Inc.; Senior Vice President,
General Counsel and a director (since November 2001) of Shareholder Financial Services,
Inc., Shareholder Services, Inc., OFI Private Investments, Inc. and OFI Trust Company;
Vice President (since November 2001) of OppenheimerFunds Legacy Program; Senior Vice
President and General Counsel (since November 2001) of OFI Institutional Asset
Management, Inc.; a director (since June 2003) of OppenheimerFunds (Asia) Limited.
Formerly Senior Vice President (May 1985-December 2003), Acting General Counsel (November
2001-February 2002) and Associate General Counsel (May 1981-October 2001) of the Manager;
Assistant Secretary of Shareholder Services, Inc. (May 1985-November 2001), Shareholder
Financial Services, Inc. (November 1989-November 2001); and OppenheimerFunds
International Ltd. (October 1997-November 2001). An officer of 86 portfolios in the
OppenheimerFunds complex.
MARK S. VANDEHEY, Senior Vice President and Chief Compliance Officer (since March 2004) of the Manager;
Vice President and Vice President (since June 1983) of OppenheimerFunds Distributor, Inc., Centennial Asset
Chief Compliance Officer Management Corporation and Shareholder Services, Inc. Formerly (until February 2004) Vice
(since 2004) President and Director of Internal Audit of the Manager. An officer of 86 portfolios in
Age: 54 the OppenheimerFunds complex.
THE FUND'S STATEMENT OF ADDITIONAL INFORMATION CONTAINS ADDITIONAL INFORMATION
ABOUT THE FUND'S TRUSTEES AND IS AVAILABLE WITHOUT CHARGE UPON REQUEST.
35 | OPPENHEIMER INTERNATIONAL 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 Trustees of the registrant has determined that Joseph M.
Wikler, the Chairman of the Board's Audit Committee, possesses the technical
attributes identified in Instruction 2(b) of Item 3 to Form N-CSR to qualify as
an "audit committee financial expert," and has designated Mr. Wikler as the
Audit Committee's financial expert. Mr. Wikler is an "independent" Trustee
pursuant to paragraph (a)(2) of Item 3 to Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES
(a) Audit Fees
The principal accountant for the audit of the registrant's annual
financial statements billed $15,650 in fiscal 2005 and $16,250 in
fiscal 2004.
(b) Audit-Related Fees
The principal accountant for the audit of the registrant's annual
financial statements billed no such fees during the last two
fiscal years.
The principal accountant for the audit of the registrant's annual
financial statements billed no such fees during the last two
fiscal years to the registrant's investment adviser or any entity
controlling, controlled by, or under common control with the
adviser that provides ongoing services to the registrant.
Such fees include: internal control reviews.
(c) Tax Fees
The principal accountant for the audit of the registrant's annual
financial statements billed no such fees in fiscal 2005 and $300
in fiscal 2004 to the registrant.
The principal accountant for the audit of the registrant's annual
financial statements billed no such fees during the last two
fiscal years to the registrant's investment adviser or any entity
controlling, controlled by, or under common control with the
adviser that provides ongoing services to the registrant.
Such fees include: tax compliance, tax planning and tax advice.
Tax compliance generally involves preparation of original and
amended tax returns, claims for a refund and tax payment-planning
services. Tax planning and tax advice includes
assistance with tax audits and appeals, tax advice related to
mergers and acquisitions and requests for rulings or technical
advice from taxing authorities.
(d) All Other Fees
The principal accountant for the audit of the registrant's annual
financial statements billed no such fees during the last two
fiscal years.
The principal accountant for the audit of the registrant's annual
financial statements billed $115,000 in fiscal 2005 and no such
fees in fiscal 2004 to the registrant's investment adviser or any
entity controlling, controlled by, or under common control with
the adviser that provides ongoing services to the registrant.
Such fees would include the cost to the principal accountant of
attending audit committee meetings and consultations regarding the
registrant's retirement plan with respect to its trustees.
(e) (1) During its regularly scheduled periodic meetings, the
registrant's audit committee will pre-approve all audit,
audit-related, tax and other services to be provided by the
principal accountants of the registrant.
The audit committee has delegated pre-approval authority to its
Chairman for any subsequent new engagements that arise between
regularly scheduled meeting dates provided that any fees such
pre-approved are presented to the audit committee at its next
regularly scheduled meeting.
Under applicable laws, pre-approval of non-audit services maybe
waived provided that: 1) the aggregate amount of all such services
provided constitutes no more than five percent of the total amount
of fees paid by the registrant to it principal accountant during
the fiscal year in which services are provided 2) such services
were not recognized by the registrant at the time of engagement as
non-audit services and 3) such services are promptly brought to
the attention of the audit committee of the registrant and
approved prior to the completion of the audit.
(2) 100%
(f) Not applicable as less than 50%.
(g) The principal accountant for the audit of the registrant's annual
financial statements billed $115,000 in fiscal 2005 and $300 in
fiscal 2004 to the registrant and the registrant's investment
adviser or any entity controlling, controlled by, or under common
control with the adviser that provides ongoing services to the
registrant related to non-audit fees. Those billings did not
include any prohibited non-audit services as defined by the
Securities Exchange Act of 1934.
(h) The registrant's audit committee of the board of trustees has
considered whether the provision of non-audit services that were
rendered to the registrant's investment adviser, and any entity
controlling, controlled by, or under common control with the
investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with
maintaining the principal account's independence. No such services
were rendered.
ITEM 5. NOT APPLICABLE
ITEM 6. SCHEDULE OF INVESTMENTS
Not applicable
ITEM 7. DISCLOSURE OF PROXY POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT
INVESTMENT COMPANIES
Not applicable
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT COMPANIES
Not applicable
ITEM 9. PURCHASE OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS
Not applicable
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Board is responsible for approving nominees for election as
trustees. 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 trustees 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 Trustees 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 Trustees of the named Registrant, c/o
the Secretary of the Registrant.
The Committee's process for identifying and evaluating nominees for
trustees 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 11. CONTROLS AND PROCEDURES
(a) Based on their evaluation of registrant's disclosure controls and
procedures (as defined in rule 30a-3(c) under the Investment
Company Act of 1940 (17 CFR 270.30a-3(c)) as of April 30, 2005,
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 changes in registrant's internal controls over
financial reporting that occurred during the registrant's last
fiscal quarter that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control
over financial reporting.
ITEM 12. EXHIBITS.
(A) EXHIBIT ATTACHED HERETO. (ATTACH CODE OF ETHICS AS EXHIBIT)(NOT
APPLICABLE TO SEMIANNUAL REPORTS)
(B) EXHIBITS ATTACHED HERETO. (ATTACH CERTIFICATIONS AS EXHIBITS)
(C) EXHIBITS ATTACHED HERETO. (ATTACH PORTFOLIO PROXY VOTING POLICIES AND
PROCEDURES AS REQUIRED BY ITEM 7)
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Oppenheimer International Value Fund
By: /S/ JOHN V. MURPHY
----------------------------
John V. Murphy
Principal Executive Officer
Date: June 15, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /S/ JOHN V. MURPHY
----------------------------
John V. Murphy
Principal Executive Officer
Date: June 15, 2005
By: /S/ BRIAN W. WIXTED
----------------------------
Brian W. Wixted
Chief Financial Officer
Date: June 15, 2005