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
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Oppenheimer International Value Trust
-------------------------------------
(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: 10/31/2007
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ITEM 1. REPORTS TO STOCKHOLDERS.
TOP HOLDINGS AND ALLOCATIONS
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TOP TEN COMMON STOCK HOLDINGS
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Haseko Corp. 3.0%
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Swiss Reinsurance Co. 3.0
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Bank of Ireland 3.0
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Aegon NV 2.8
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Nestle SA 2.6
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Eni SpA 2.4
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Nokia Oyj 2.4
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Aksa Akrilik Kimya Sanayii AS 2.2
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Bayerische Motoren Werke (BMW) AG 2.2
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Credit Agricole SA 2.0
Portfolio holdings and allocations are subject to change. Percentages are as of
October 31, 2007, and are based on net assets.
TOP TEN GEOGRAPHIC HOLDINGS
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Japan 15.1%
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United Kingdom 12.8
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France 12.2
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The Netherlands 6.6
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Switzerland 6.4
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Germany 6.3
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Italy 5.4
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United States 4.8
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Korea, Republic of South 4.5
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Ireland 4.2
Portfolio holdings and allocations are subject to change. Percentages are as of
October 31, 2007, and are based on the total market value of investments.
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10 | OPPENHEIMER INTERNATIONAL VALUE FUND
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REGIONAL ALLOCATION
[THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]
Europe 63.7%
Asia 24.9
United States/Canada 6.7
Middle East/Africa 3.1
Latin America 1.6
Portfolio holdings and allocations are subject to change. Percentages are as of
October 31, 2007, and are based on the total market value of investments.
For more current Fund holdings, please visit www.oppenheimerfunds.com.
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11 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES
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Total returns include changes in share price and reinvestment of dividends and
capital gains distributions in a hypothetical investment for the periods shown.
Cumulative total returns are not annualized. 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.
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) and 3% (since inception). Class B shares are subject
to an annual 0.75% asset-based sales charge.
CLASS C shares of the Fund were first publicly offered on 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.
CLASS Y shares of the Fund were first publicly offered on 9/27/05. Class Y
shares are offered to only to certain institutional investors under special
agreement with the Distributor.
An explanation of the calculation of performance is in the Fund's Statement of
Additional Information.
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 October 31, 2007.
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
13 | OPPENHEIMER INTERNATIONAL VALUE FUND
FUND EXPENSES Continued
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT PAID DURING
VALUE VALUE 6 MONTHS ENDED
5/1/07 10/31/07 OCTOBER 31, 2007
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Class A Actual $ 1,000.00 $ 1,034.80 $ 6.90
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Class A Hypothetical 1,000.00 1,018.45 6.84
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Class B Actual 1,000.00 1,030.30 11.48
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Class B Hypothetical 1,000.00 1,013.96 11.38
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Class C Actual 1,000.00 1,030.80 11.01
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Class C Hypothetical 1,000.00 1,014.42 10.92
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Class Y Actual 1,000.00 1,035.20 4.63
- --------------------------------------------------------------------------------
Class Y Hypothetical 1,000.00 1,020.67 4.59
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 184/365
(to reflect the one-half year period). Those annualized expense ratios,
excluding indirect expenses from affiliated fund, based on the 6-month period
ended October 31, 2007 are as follows:
CLASS EXPENSE RATIOS
- -----------------------------
Class A 1.34%
- -----------------------------
Class B 2.23
- -----------------------------
Class C 2.14
- -----------------------------
Class Y 0.90
The expense ratios reflect reduction to custodian expenses and voluntary waivers
or reimbursements by the Fund's Manager 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 and reduction to custodian
expenses, if applicable.
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14 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF INVESTMENTS October 31, 2007 / Unaudited
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SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCKS--93.0%
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CONSUMER DISCRETIONARY--22.3%
- --------------------------------------------------------------------------------
AUTO COMPONENTS--1.2%
Continental AG 18,346 $ 2,771,765
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AUTOMOBILES--4.7%
Bayerische Motoren
Werke (BMW) AG 73,085 4,881,508
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Hyundai Motor Co. 45,183 3,593,048
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Toyota Motor Corp. 38,780 2,215,404
-------------
10,689,960
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DISTRIBUTORS--1.1%
Medion AG 1 94,495 2,603,455
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HOTELS, RESTAURANTS & LEISURE--0.9%
Compass Group plc 288,930 2,086,185
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HOUSEHOLD DURABLES--5.2%
Barratt
Developments plc 28,120 383,074
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First Juken Co. Ltd. 396,200 1,853,166
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Grande Holdings
Ltd. (The) 1,134,000 449,118
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Haseko Corp. 1 2,834,000 6,807,783
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Taylor Wimpey plc 420,760 2,177,570
-------------
11,670,711
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INTERNET & CATALOG RETAIL--0.0%
Alibaba.com Ltd. 1 4,000 6,905
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LEISURE EQUIPMENT & PRODUCTS--0.5%
Sega Sammy Holdings,
Inc. 83,200 1,143,085
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MEDIA--3.6%
British Sky
Broadcasting Group
plc 162,009 2,292,374
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Societe Television
Francaise 1 63,830 1,771,623
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Vivendi SA 90,070 4,055,009
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8,119,006
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SPECIALTY RETAIL--2.1%
Aoyama Trading Co. 58,273 1,512,830
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Dickson Concepts
International Ltd. 625,000 522,837
SHARES VALUE
- --------------------------------------------------------------------------------
SPECIALTY RETAIL Continued
Signet Group plc 1,399,110 $ 2,636,659
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4,672,326
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TEXTILES, APPAREL & LUXURY GOODS--3.0%
Aksa Akrilik Kimya
Sanayii AS 1,838,897 5,038,980
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Asics Corp. 111,000 1,754,986
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6,793,966
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CONSUMER STAPLES--9.1%
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BEVERAGES--1.0%
Heineken NV 32,550 2,277,345
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FOOD & STAPLES RETAILING--1.9%
Tesco plc 422,706 4,289,201
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FOOD PRODUCTS--4.3%
Nestle SA 12,906 5,954,987
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Unilever NV 114,077 3,715,512
------------
9,670,499
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PERSONAL PRODUCTS--1.9%
Amorepacific Corp. 1,229 1,174,557
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Coreana Cosmetics
Co. Ltd. 1 781,709 1,010,678
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Pacific Corp. 9,804 2,220,513
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4,405,748
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ENERGY--6.9%
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ENERGY EQUIPMENT & SERVICES--2.3%
Petroleum
Geo-Services ASA 97,200 2,861,594
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Seabird Exploration
Ltd. 1 575,484 2,350,210
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5,211,804
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OIL, GAS & CONSUMABLE FUELS--4.6%
Eni SpA 147,690 5,391,161
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Thai Oil Public Co. Ltd. 372,300 1,058,692
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Total SA 47,600 3,837,097
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10,286,950
15 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
SHARES VALUE
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FINANCIALS--21.6%
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CAPITAL MARKETS--1.3%
Credit Suisse Group 25,127 $ 1,696,378
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Ichiyoshi Securities Co.
Ltd. 43,400 471,803
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RHJ International Ltd. 1 48,883 858,205
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3,026,386
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COMMERCIAL BANKS--9.0%
Anglo Irish Bank Corp. 156,726 2,646,466
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Bank of Ireland 362,161 6,718,896
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Credit Agricole SA 114,321 4,535,414
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Danske Bank AS 27,890 1,233,293
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National Bank of
Greece SA 29,140 2,034,806
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Royal Bank of Scotland
Group plc (The) 297,604 3,211,006
-------------
20,379,881
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DIVERSIFIED FINANCIAL SERVICES--1.2%
Investor AB, B Shares 106,896 2,651,308
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INSURANCE--7.5%
Aegon NV 302,861 6,279,339
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Fondiaria-Sai SpA 111,810 3,810,950
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Swiss Reinsurance Co. 71,766 6,758,178
-------------
16,848,467
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REAL ESTATE MANAGEMENT & DEVELOPMENT--1.0%
Emperor
Entertainment
Hotel Ltd. 4,889,000 1,127,699
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Shanghai Forte Land
Co. Ltd. 1,564,000 1,221,750
-------------
2,349,449
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THRIFTS & MORTGAGE FINANCE--1.6%
Paragon Group Cos
plc 737,000 3,652,003
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HEALTH CARE--4.8%
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HEALTH CARE PROVIDERS & SERVICES--0.8%
Mediceo Paltac
Holdings Co. Ltd. 118,860 1,727,927
SHARES VALUE
- --------------------------------------------------------------------------------
PHARMACEUTICALS--4.0%
GlaxoSmithKline plc 2 123,000 $ 3,166,240
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Sanofi-Aventis SA 35,840 3,153,320
- --------------------------------------------------------------------------------
Takeda Pharmaceutical
Co. Ltd. 45,300 2,827,469
-------------
9,147,029
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INDUSTRIALS--10.1%
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AEROSPACE & DEFENSE--1.0%
Safran SA 90,106 2,285,444
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AIRLINES--3.2%
Deutsche Lufthansa
AG 73,228 2,164,965
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Jazz Air Income Fund 368,400 3,002,890
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Turk Hava Yollari
Anonim Ortakligi 1 277,900 1,977,936
-------------
7,145,791
- --------------------------------------------------------------------------------
COMMERCIAL SERVICES & SUPPLIES--1.7%
Corporate Express 69,600 773,277
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Quebecor World, Inc. 1 135,796 1,322,525
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Sperian Protection 12,700 1,780,962
-------------
3,876,764
- --------------------------------------------------------------------------------
CONSTRUCTION & ENGINEERING--1.9%
Joongang Construction
Co. Ltd. 109,070 2,104,924
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Technical Olympic SA 1 233,861 418,242
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Vinci SA 20,480 1,686,130
-------------
4,209,296
- --------------------------------------------------------------------------------
MACHINERY--0.7%
GEA Group AG 1 42,893 1,615,589
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MARINE--1.0%
Evergreen Marine
Corp. 2,247,000 2,231,648
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TRANSPORTATION INFRASTRUCTURE--0.6%
Master Marine AS 1,3 17,500 39,423
- --------------------------------------------------------------------------------
Master Marine AS 1,3 619,900 1,396,473
-------------
1,435,896
16 | OPPENHEIMER INTERNATIONAL VALUE FUND
SHARES VALUE
- --------------------------------------------------------------------------------
INFORMATION TECHNOLOGY--7.6%
- --------------------------------------------------------------------------------
COMMUNICATIONS EQUIPMENT--2.4%
Nokia Oyj 4 135,450 $ 5,366,202
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SunCorp Technologies
Ltd. 1 2,512,000 98,024
-------------
5,464,226
- --------------------------------------------------------------------------------
COMPUTERS & PERIPHERALS--3.8%
Fujitsu Ltd. 325,987 2,569,913
- --------------------------------------------------------------------------------
Gemalto NV 1 55,600 1,632,523
- --------------------------------------------------------------------------------
Japan Digital
Laboratory Co. Ltd. 290,100 4,380,588
-------------
8,583,024
- --------------------------------------------------------------------------------
ELECTRONIC EQUIPMENT & INSTRUMENTS--0.6%
Nichicon Corp. 114,200 1,363,201
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OFFICE ELECTRONICS--0.8%
Canon, Inc. 36,770 1,857,914
- --------------------------------------------------------------------------------
MATERIALS--4.2%
- --------------------------------------------------------------------------------
CHEMICALS--1.3%
Arkema 1 27,392 1,869,448
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Polynt SpA 193,956 958,351
-------------
2,827,799
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METALS & MINING--2.5%
ArcelorMittal 25,305 2,047,696
- --------------------------------------------------------------------------------
Hindalco Industries
Ltd. 704,200 3,560,767
-------------
5,608,463
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PAPER & FOREST PRODUCTS--0.4%
PaperlinX Ltd. 372,800 966,021
- --------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES--5.8%
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DIVERSIFIED TELECOMMUNICATION SERVICES--3.6%
Cable & Wireless plc 476,915 1,938,651
- --------------------------------------------------------------------------------
France Telecom SA 65,831 2,427,837
- --------------------------------------------------------------------------------
Telecom Italia
SpA-RNC 703,710 1,818,525
- --------------------------------------------------------------------------------
Telefonos de Mexico
SA de CV, Cl. L 1,102,590 2,016,460
-------------
8,201,473
SHARES VALUE
- --------------------------------------------------------------------------------
WIRELESS TELECOMMUNICATION SERVICES--2.2%
KDDI Corp. 271 $ 2,051,489
- --------------------------------------------------------------------------------
Vodafone Group plc 703,378 2,774,398
-------------
4,825,887
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UTILITIES--0.6%
- --------------------------------------------------------------------------------
ELECTRIC UTILITIES--0.6%
Okinawa Electric
Power Co. (The) 26,640 1,390,134
-------------
Total Common Stocks
(Cost $172,278,340) 210,369,931
PRINCIPAL
AMOUNT
- --------------------------------------------------------------------------------
CONVERTIBLE CORPORATE BONDS AND NOTES--1.3%
- --------------------------------------------------------------------------------
AED Oil Ltd., 6.50%
Cv. Unsec. Unsub. Nts.,
2/23/12 $ 1,846,000 2,344,416
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Master Marine AS,
6% Cv. Nts.,
6/1/10 3 [NOK] 2,874,000 535,515
-------------
Total Convertible
Corporate Bonds and
Notes (Cost $2,555,901) 2,879,931
SHARES
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INVESTMENTS IN AFFILIATED COMPANIES--4.7%
- --------------------------------------------------------------------------------
Oppenheimer
Institutional Money
Market Fund, Cl. E,
5.20% 5,6
(Cost $10,744,404) 10,744,404 10,744,404
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TOTAL INVESTMENTS,
AT VALUE
(COST $185,578,645) 99.0% 223,994,266
- --------------------------------------------------------------------------------
OTHER ASSETS NET
OF LIABILITIES 1.0 2,253,221
---------------------------
NET ASSETS 100.0% $226,247,487
===========================
FOOTNOTES TO STATEMENT OF INVESTMENTS
Principal amount is reported in U.S. Dollars, except for those denoted in the
following currency:
NOK Norwegian Krone
17 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF INVESTMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
FOOTNOTES TO STATEMENT OF INVESTMENTS Continued
1. Non-income producing security.
2. A sufficient amount of securities has been designated to cover outstanding
foreign currency contracts. See Note 5 of accompanying Notes.
3. Illiquid security. The aggregate value of illiquid securities as of October
31, 2007 was $1,971,411, which represents 0.87% of the Fund's net assets. See
Note 7 of accompanying Notes.
4. A sufficient amount of liquid assets has been designated to cover outstanding
written call options, as follows:
CONTRACTS EXPIRATION EXERCISE PREMIUM
SUBJECT TO CALL DATE PRICE RECEIVED VALUE
- ----------------------------------------------------------------------------------------------
Nokia Oyj 507 11/19/07 $26 $89,816 $117,506
5. Is or was an affiliate, as defined in the Investment Company Act of 1940, at
or during the period ended October 31, 2007, by virtue of the Fund owning at
least 5% of the voting securities of the issuer or as a result of the Fund and
the issuer having the same investment advisor. Transactions during the period in
which the issuer was an affiliate are as follows:
SHARES GROSS GROSS SHARES
APRIL 30, 2007 ADDITIONS REDUCTIONS OCTOBER 31, 2007
- ----------------------------------------------------------------------------------------------
Oppenheimer Institutional Money
Market Fund, Cl. E 6,813,546 73,925,097 69,994,239 10,744,404
DIVIDEND
VALUE INCOME
- ----------------------------------------------------------------------------------------------
Oppenheimer Institutional Money Market Fund, Cl. E $10,744,404 $165,164
6. Rate shown is the 7-day yield as of October 31, 2007.
DISTRIBUTION OF INVESTMENTS REPRESENTING GEOGRAPHIC HOLDINGS, AS A PERCENTAGE OF
TOTAL INVESTMENTS AT VALUE, IS AS FOLLOWS:
GEOGRAPHIC HOLDINGS VALUE PERCENT
- -------------------------------------------------------------------------------
Japan $ 33,927,692 15.1%
United Kingdom 28,607,361 12.8
France 27,402,284 12.2
The Netherlands 14,677,996 6.6
Switzerland 14,409,543 6.4
Germany 14,037,282 6.3
Italy 11,978,987 5.4
United States 10,744,404 4.8
Korea, Republic of South 10,103,720 4.5
Ireland 9,365,362 4.2
Norway 7,183,215 3.2
Turkey 7,016,916 3.1
Finland 5,366,202 2.4
Canada 4,325,415 1.9
India 3,560,767 1.6
Australia 3,310,437 1.5
Sweden 2,651,308 1.2
Greece 2,453,048 1.1
Taiwan 2,231,648 1.0
Luxembourg 2,047,696 0.9
Mexico 2,016,460 0.9
Bermuda 1,650,536 0.7
Denmark 1,233,293 0.6
China 1,221,750 0.5
Thailand 1,058,692 0.5
Belgium 858,205 0.4
Hong Kong 547,142 0.2
Cayman Islands 6,905 0.0
--------------------------
Total $ 223,994,266 100.0%
==========================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
18 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES Unaudited
- --------------------------------------------------------------------------------
October 31, 2007
- ------------------------------------------------------------------------------------------------------
ASSETS
- ------------------------------------------------------------------------------------------------------
Investments, at value--see accompanying statement of investments:
Unaffiliated companies (cost $174,834,241) $ 213,249,862
Affiliated companies (cost $10,744,404) 10,744,404
--------------
223,994,266
- ------------------------------------------------------------------------------------------------------
Cash 164,089
- ------------------------------------------------------------------------------------------------------
Unrealized appreciation on foreign currency contracts 14,094
- ------------------------------------------------------------------------------------------------------
Receivables and other assets:
Shares of beneficial interest sold 2,361,725
Investments sold 1,430,433
Interest and dividends 668,500
Other 6,604
--------------
Total assets 228,639,711
- ------------------------------------------------------------------------------------------------------
LIABILITIES
- ------------------------------------------------------------------------------------------------------
Bank overdraft--foreign currencies (cost $198,300) 196,531
- ------------------------------------------------------------------------------------------------------
Options written, at value (premiums received $89,816)--see accompanying
statement of investments 117,506
- ------------------------------------------------------------------------------------------------------
Unrealized depreciation on foreign currency contracts 357,002
- ------------------------------------------------------------------------------------------------------
Payables and other liabilities:
Investments purchased 825,119
Shares of beneficial interest redeemed 518,801
Foreign capital gains tax 104,802
Due to Custodian 90,748
Distribution and service plan fees 44,577
Shareholder communications 34,971
Transfer and shareholder servicing agent fees 33,817
Trustees' compensation 13,126
Other 55,224
--------------
Total liabilities 2,392,224
- ------------------------------------------------------------------------------------------------------
NET ASSETS $ 226,247,487
==============
- ------------------------------------------------------------------------------------------------------
COMPOSITION OF NET ASSETS
- ------------------------------------------------------------------------------------------------------
Par value of shares of beneficial interest $ 10,921
- ------------------------------------------------------------------------------------------------------
Additional paid-in capital 180,276,905
- ------------------------------------------------------------------------------------------------------
Accumulated net investment income 2,115,344
- ------------------------------------------------------------------------------------------------------
Accumulated net realized gain on investments and foreign currency transactions 5,882,909
- ------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments and translation
of assets and liabilities denominated in foreign currencies 37,961,408
--------------
NET ASSETS $ 226,247,487
==============
19 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF ASSETS AND LIABILITIES Unaudited / Continued
- --------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE
- -----------------------------------------------------------------------------------------------
Class A Shares:
Net asset value and redemption price per share (based on net assets
of $149,082,866 and 7,154,101 shares of beneficial interest outstanding) $ 20.84
Maximum offering price per share (net asset value plus sales charge
of 5.75% of offering price) $ 22.11
- -----------------------------------------------------------------------------------------------
Class B Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net assets
of $24,201,982 and 1,184,433 shares of beneficial interest outstanding) $ 20.43
- -----------------------------------------------------------------------------------------------
Class C Shares:
Net asset value, redemption price (excludes applicable contingent
deferred sales charge) and offering price per share (based on net assets
of $42,476,152 and 2,080,234 shares of beneficial interest outstanding) $ 20.42
- -----------------------------------------------------------------------------------------------
Class Y Shares:
Net asset value, redemption price and offering price per share (based
on net assets of $10,486,487 and 502,434 shares of beneficial interest outstanding) $ 20.87
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
20 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF OPERATIONS Unaudited
- --------------------------------------------------------------------------------
For the Six Months Ended October 31, 2007
- ----------------------------------------------------------------------------------------
INVESTMENT INCOME
- ----------------------------------------------------------------------------------------
Dividends:
Unaffiliated companies (net of foreign withholding taxes of $285,252) $ 2,705,147
Affiliated companies 165,164
- ----------------------------------------------------------------------------------------
Interest 44,849
- ----------------------------------------------------------------------------------------
Portfolio lending fees 86,065
- ----------------------------------------------------------------------------------------
Other income 2,025
-------------
Total investment income 3,003,250
- ----------------------------------------------------------------------------------------
EXPENSES
- ----------------------------------------------------------------------------------------
Management fees 923,709
- ----------------------------------------------------------------------------------------
Distribution and service plan fees:
Class A 173,571
Class B 124,157
Class C 218,552
- ----------------------------------------------------------------------------------------
Transfer and shareholder servicing agent fees:
Class A 114,679
Class B 31,681
Class C 40,055
- ----------------------------------------------------------------------------------------
Shareholder communications:
Class A 17,687
Class B 6,449
Class C 6,307
Class Y 5
- ----------------------------------------------------------------------------------------
Custodian fees and expenses 20,638
- ----------------------------------------------------------------------------------------
Trustees' compensation 3,184
- ----------------------------------------------------------------------------------------
Other 57,605
-------------
Total expenses 1,738,279
Less reduction to custodian expenses (3,566)
Less waivers and reimbursements of expenses (3,141)
-------------
Net expenses 1,731,572
- ----------------------------------------------------------------------------------------
NET INVESTMENT INCOME 1,271,678
21 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENT OF OPERATIONS Unaudited / Continued
- --------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
- ----------------------------------------------------------------------------------------------------
Net realized gain (loss) on:
Investments from unaffiliated companies (net of foreign capital gains tax of $464) $ (111,666)
Foreign currency transactions 2,573,805
------------
Net realized gain 2,462,139
- ----------------------------------------------------------------------------------------------------
Net change in unrealized appreciation (depreciation) on:
Investments (net of foreign capital gains tax of $89,578) (4,492,979)
Translation of assets and liabilities denominated in foreign currencies 7,254,965
Option contracts written (27,690)
------------
Net change in unrealized appreciation 2,734,296
- ----------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 6,468,113
============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
22 | OPPENHEIMER INTERNATIONAL VALUE FUND
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------
SIX MONTHS YEAR
ENDED ENDED
OCTOBER 31, 2007 APRIL 30,
(UNAUDITED) 2007
- ---------------------------------------------------------------------------------------------------------------------------
OPERATIONS
- ---------------------------------------------------------------------------------------------------------------------------
Net investment income $ 1,271,678 $ 1,855,858
- ---------------------------------------------------------------------------------------------------------------------------
Net realized gain 2,462,139 6,948,648
- ---------------------------------------------------------------------------------------------------------------------------
Net change in unrealized appreciation 2,734,296 18,877,192
---------------------------------
Net increase in net assets resulting from operations 6,468,113 27,681,698
- ---------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
- ---------------------------------------------------------------------------------------------------------------------------
Dividends from net investment income:
Class A -- (1,189,075)
Class B -- (54,596)
Class C -- (143,190)
Class Y -- (16)
---------------------------------
-- (1,386,877)
- ---------------------------------------------------------------------------------------------------------------------------
Distributions from net realized gain:
Class A -- (4,112,243)
Class B -- (731,519)
Class C -- (1,272,488)
Class Y -- (45)
---------------------------------
-- (6,116,295)
- ---------------------------------------------------------------------------------------------------------------------------
BENEFICIAL INTEREST TRANSACTIONS
- ---------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from beneficial interest transactions:
Class A 4,973,263 50,029,878
Class B (993,311) 6,154,227
Class C (914,171) 12,409,551
Class Y 10,273,540 --
---------------------------------
13,339,321 68,593,656
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS
- ---------------------------------------------------------------------------------------------------------------------------
Total increase 19,807,434 88,772,182
- ---------------------------------------------------------------------------------------------------------------------------
Beginning of period 206,440,053 117,667,871
---------------------------------
End of period (including accumulated net investment income
of $2,115,344 and $843,666, respectively) $ 226,247,487 $ 206,440,053
=================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
23 | OPPENHEIMER INTERNATIONAL VALUE FUND
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
SIX MONTHS
ENDED
OCTOBER 31, 2007 YEAR ENDED APRIL 30,
CLASS A (UNAUDITED) 2007 2006 2005 2004 1
- -----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 20.14 $ 17.84 $ 14.43 $ 12.98 $ 10.00
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income .15 2 .28 2 .12 2 .15 2 .01
Net realized and unrealized gain .55 2.93 3.84 2.10 3.02
---------------------------------------------------------------
Total from investment operations .70 3.21 3.96 2.25 3.03
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- (.20) (.20) -- --
Distributions from net realized gain -- (.71) (.35) (.80) (.05)
---------------------------------------------------------------
Total dividends and/or distributions to shareholders -- (.91) (.55) (.80) (.05)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.84 $ 20.14 $ 17.84 $ 14.43 $ 12.98
===============================================================
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 3.48% 18.49% 27.98% 17.74% 30.35%
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 149,083 $ 139,691 $ 76,304 $ 29,831 $ 6,753
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 147,429 $ 100,351 $ 52,647 $ 11,186 $ 6,126
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 1.43% 1.51% 0.72% 1.05% 0.14%
Total expenses 1.34% 5 1.36% 5 1.43% 1.63% 2.13%
Expenses after payments, waivers and/or
reimbursements and reduction to custodian expenses 1.34% 1.36% 1.43% 1.54% 1.70%
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 33% 38% 49% 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 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 less than one full year.
5. Total expenses including indirect expenses from affiliated fund were as
follows:
Six Months Ended October 31, 2007 1.34%
Year Ended April 30, 2007 1.36%
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
24 | OPPENHEIMER INTERNATIONAL VALUE FUND
SIX MONTHS
ENDED
OCTOBER 31, 2007 YEAR ENDED APRIL 30,
CLASS B (UNAUDITED) 2007 2006 2005 1
- -----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 19.83 $ 17.60 $ 14.28 $ 12.99
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) 2 .06 .11 (.02) .01
Net realized and unrealized gain .54 2.88 3.79 2.08
--------------------------------------------------
Total from investment operations .60 2.99 3.77 2.09
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- (.05) (.10) --
Distributions from net realized gain -- (.71) (.35) (.80)
--------------------------------------------------
Total dividends and/or distributions to shareholders -- (.76) (.45) (.80)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.43 $ 19.83 $ 17.60 $ 14.28
==================================================
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 3.03% 17.39% 26.82% 16.47%
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 24,202 $ 24,525 $ 15,876 $ 7,695
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 24,672 $ 18,659 $ 12,099 $ 1,997
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss) 0.55% 0.62% (0.16)% 0.04%
Total expenses 2.23% 5 2.27% 5 2.34% 2.59%
Expenses after payments, waivers and/or reimbursements
and reduction to custodian expenses 2.23% 2.27% 2.34% 2.45%
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 33% 38% 49% 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 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 less than one full year.
5. Total expenses including indirect expenses from affiliated fund were as
follows:
Six Months Ended October 31, 2007 2.23%
Year Ended April 30, 2007 2.27%
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
25 | OPPENHEIMER INTERNATIONAL VALUE FUND
FINANCIAL HIGHLIGHTS Continued
- --------------------------------------------------------------------------------
SIX MONTHS
ENDED
OCTOBER 31, 2007 YEAR ENDED APRIL 30,
CLASS C (UNAUDITED) 2007 2006 2005 1
- -----------------------------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 19.81 $ 17.59 $ 14.28 $ 12.99
- -----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income (loss) 2 .06 .13 (.01) .02
Net realized and unrealized gain .55 2.88 3.80 2.07
--------------------------------------------------
Total from investment operations .61 3.01 3.79 2.09
- -----------------------------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- (.08) (.13) --
Distributions from net realized gain -- (.71) (.35) (.80)
--------------------------------------------------
Total dividends and/or distributions to shareholders -- (.79) (.48) (.80)
- -----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.42 $ 19.81 $ 17.59 $ 14.28
==================================================
- -----------------------------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 3.08% 17.51% 26.98% 16.47%
- -----------------------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 42,476 $ 42,223 $ 25,487 $ 9,565
- -----------------------------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 43,357 $ 31,937 $ 17,903 $ 2,364
- -----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income (loss) 0.63% 0.71% (0.09)% 0.12%
Total expenses 2.14% 5 2.16% 5 2.23% 2.44%
Expenses after payments, waivers and/or reimbursements
and reduction to custodian expenses 2.14% 2.16% 2.23% 2.41%
- -----------------------------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 33% 38% 49% 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 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 less than one full year.
5. Total expenses including indirect expenses from affiliated fund were as
follows:
Six Months Ended October 31, 2007 2.14%
Year Ended April 30, 2007 2.16%
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
26 | OPPENHEIMER INTERNATIONAL VALUE FUND
SIX MONTHS
ENDED
OCTOBER 31, 2007 YEAR ENDED APRIL 30,
CLASS Y (UNAUDITED) 2007 2006 1
- ---------------------------------------------------------------------------------------------------------------
PER SHARE OPERATING DATA
- ---------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period $ 20.16 $ 17.84 $ 15.61
- ---------------------------------------------------------------------------------------------------------------
Income (loss) from investment operations:
Net investment income 2 .22 .34 .07
Net realized and unrealized gain .49 2.94 2.76
------------------------------------------------
Total from investment operations .71 3.28 2.83
- ---------------------------------------------------------------------------------------------------------------
Dividends and/or distributions to shareholders:
Dividends from net investment income -- (.25) (.25)
Distributions from net realized gain -- (.71) (.35)
------------------------------------------------
Total dividends and/or distributions to shareholders -- (.96) (.60)
- ---------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 20.87 $ 20.16 $ 17.84
================================================
- ---------------------------------------------------------------------------------------------------------------
TOTAL RETURN, AT NET ASSET VALUE 3 3.52% 18.89% 18.68%
- ---------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ---------------------------------------------------------------------------------------------------------------
Net assets, end of period (in thousands) $ 10,486 $ 1 $ 1
- ---------------------------------------------------------------------------------------------------------------
Average net assets (in thousands) $ 211 $ 1 $ 1
- ---------------------------------------------------------------------------------------------------------------
Ratios to average net assets: 4
Net investment income 2.71% 1.87% 0.73%
Total expenses 0.90% 5,6,7 0.94% 5,6,7 1.01% 5
- ---------------------------------------------------------------------------------------------------------------
Portfolio turnover rate 33% 38% 49%
1. For the period from September 27, 2005 (commencement of operations) to April
30, 2006.
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 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 less than one full year.
5. Reduction to custodian expenses less than 0.005%.
6. Total expenses including indirect expenses from affiliated fund were as
follows:
Six Months Ended October 31, 2007 0.90%
Year Ended April 30, 2007 0.94%
7. Voluntary waiver or reimbursement of indirect management fees less than
0.005%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
27 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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, Class C and Class Y shares. Class A
shares are sold at their offering price, which is normally net asset value plus
a front-end sales charge. Class B and Class C shares are sold without a
front-end sales charge but may be subject to a contingent deferred sales charge
(CDSC). Class Y shares are sold to certain institutional investors without
either a front-end sales charge or a CDSC, however, the institutional investor
may impose charges on those accounts. 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. Class A, B and C have
separate distribution and/or service plans. No such plan has been adopted for
Class Y shares. Class B shares will automatically convert to Class A shares six
years after the date of purchase. The 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 may be
valued primarily using dealer-supplied valuations or a portfolio pricing service
authorized by the Board of Trustees. Securities listed or traded on National
Stock Exchanges or other domestic 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(R) are valued based on the
closing price provided by NASDAQ prior to the time when the Fund's assets are
valued. In the absence of a sale, the security is valued at the last sale price
on the prior trading day, if it is within the spread of the closing "bid" and
"asked" prices, and if not, at the closing bid price. Securities traded on
foreign exchanges are valued based on the last sale price on the principal
exchange on which the security is traded, as identified by the portfolio pricing
service, prior to the time when the Fund's assets are valued. In the absence of
a sale, the security is valued at the official closing price on the principal
exchange. 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
28 | OPPENHEIMER INTERNATIONAL VALUE FUND
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. Options are valued daily based upon the last sale
price on the principal exchange on which the option is traded. 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. Investments in open-end registered
investment companies (including affiliated funds) are valued at that fund's net
asset value. 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.
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.
- --------------------------------------------------------------------------------
INVESTMENT IN OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND. The Fund is permitted
to invest daily available cash balances in an affiliated money market fund. The
Fund may invest the available cash in Class E shares of Oppenheimer
Institutional Money Market Fund ("IMMF") which seeks current income and
stability of principal. IMMF is a registered open-end management investment
company, regulated as a money market fund under the Investment Company Act of
1940, as amended. The Manager is also the investment advisor of IMMF. The Fund's
investment in IMMF is included in the Statement of Investments, if applicable.
As a shareholder, the Fund is subject to its proportional share
29 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
of IMMF's Class E expenses, including its management fee. The Manager will waive
fees and/or reimburse Fund expenses in an amount equal to the indirect
management fees incurred through the Fund's investment in IMMF.
- --------------------------------------------------------------------------------
INVESTMENTS WITH OFF-BALANCE SHEET RISK. The Fund enters into financial
instrument transactions (such as swaps, futures, options and other derivatives)
that may have off-balance sheet market risk. Off-balance sheet market risk
exists when the maximum potential loss on a particular financial instrument is
greater than the value of such financial instrument, as reflected in the Fund's
Statement of Assets and Liabilities.
- --------------------------------------------------------------------------------
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
- --------------------------------------------------------------------------------
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders, therefore, no federal income or excise tax provision is
required.
Net investment income (loss) and net realized gain (loss) may differ for
financial statement and tax purposes. The character of dividends and
distributions made during the fiscal year from net investment income or net
realized gains may differ from their ultimate characterization for federal
income tax purposes. Also, due to timing of dividends and distributions, the
fiscal year in which amounts are distributed may differ from the fiscal year in
which the income or net realized gain was recorded by the Fund.
As of October 31, 2007, the Fund had available for federal income tax
purposes an estimated capital loss carryforward of $543,185 expiring by 2016.
This estimated capital loss carryforward represents carryforward as of the end
of the last fiscal year, increased for losses deferred under tax accounting
rules to the current fiscal year and is increased or decreased by capital losses
or gains realized in the first six months of the current fiscal year. As of
October 31, 2007, it is estimated that the Fund will utilize $543,185 of capital
loss carryforward to offset realized capital gains. During the fiscal year ended
April 30, 2007, the Fund did not utilized any capital loss carryforward to
offset capital gains realized in that fiscal year.
As of April 30, 2007, the Fund had available for federal income tax
purposes post-October foreign currency losses of $543,185.
Certain foreign countries impose a tax on capital gains which is accrued
by the Fund based on unrealized appreciation, if any, on affected securities.
The tax is paid when the gain is realized.
30 | OPPENHEIMER INTERNATIONAL VALUE FUND
- --------------------------------------------------------------------------------
TRUSTEES' COMPENSATION. The Fund has adopted an unfunded retirement plan (the
"Plan") for the Fund's independent trustees. Benefits are based on years of
service and fees paid to each trustee during their period of service. The Plan
was frozen with respect to adding new participants effective December 31, 2006
(the "Freeze Date") and existing Plan Participants as of the Freeze Date will
continue to receive accrued benefits under the Plan. Active independent trustees
as of the Freeze Date have each elected a distribution method with respect to
their benefits under the Plan. During the six months ended October 31, 2007, the
Fund's projected benefit obligations were increased by $1,087 and payments of
$1,326 were made to retired trustees, resulting in an accumulated liability of
$8,861 as of October 31, 2007.
The Board of Trustees has adopted a compensation deferral plan for
independent trustees that enables trustees to elect to defer receipt of all or a
portion of the annual compensation they are entitled to receive from the Fund.
For purposes of determining the amount owed to the Trustee under the plan,
deferred amounts are treated as though equal dollar amounts had been invested in
shares of the Fund or in other Oppenheimer funds selected by the Trustee. The
Fund purchases shares of the funds selected for deferral by the Trustee in
amounts equal to his or her deemed investment, resulting in a Fund asset equal
to the deferred compensation liability. Such assets are included as a component
of "Other" within the asset section of the Statement of Assets and Liabilities.
Deferral of trustees' fees under the plan will not affect the net assets of the
Fund, and will not materially affect the Fund's assets, liabilities or net
investment income per share. Amounts will be deferred until distributed in
accordance to the compensation deferral plan.
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date. Income and capital gain distributions, if
any, are declared and paid annually.
- --------------------------------------------------------------------------------
INVESTMENT INCOME. Dividend income is recorded on the ex-dividend date or upon
ex-dividend notification in the case of certain foreign dividends where the
ex-dividend date may have passed. Non-cash dividends included in dividend
income, if any, are recorded at the fair market value of the securities
received. Interest income, which includes accretion of discount and amortization
of premium, is accrued as earned.
- --------------------------------------------------------------------------------
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, to the extent they are not
offset by positive cash balances maintained by the Fund, 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.
31 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
1. SIGNIFICANT ACCOUNTING POLICIES Continued
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.
- --------------------------------------------------------------------------------
INDEMNIFICATIONS. The Fund's organizational documents provide current and former
trustees and officers with a limited indemnification against liabilities arising
in connection with the performance of their duties to the Fund. In the normal
course of business, the Fund may also enter into contracts that provide general
indemnifications. The Fund's maximum exposure under these arrangements is
unknown as this would be dependent on future claims that may be made against the
Fund. The risk of material loss from such claims is considered remote.
- --------------------------------------------------------------------------------
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.
- --------------------------------------------------------------------------------
2. SHARES OF BENEFICIAL INTEREST
The Fund has authorized an unlimited number of $0.001 par value shares of
beneficial interest of each class. Transactions in shares of beneficial interest
were as follows:
SIX MONTHS ENDED OCTOBER 31, 2007 YEAR ENDED APRIL 30, 2007
SHARES AMOUNT SHARES AMOUNT
- ---------------------------------------------------------------------------------------------------
CLASS A
Sold 1,336,801 $ 27,301,783 4,011,495 $ 74,723,939
Dividends and/or
distributions reinvested -- -- 244,920 4,504,013
Redeemed (1,120,326) (22,328,520) 1 (1,595,437) (29,198,074) 2
----------------------------------------------------------------
Net increase 216,475 $ 4,973,263 2,660,978 $ 50,029,878
================================================================
- ----------------------------------------------------------------- ---------------------------------
CLASS B
Sold 202,437 $ 4,066,750 627,709 $ 11,416,302
Dividends and/or
distributions reinvested -- -- 38,254 695,073
Redeemed (254,588) (5,060,061) 1 (331,278) (5,957,148) 2
----------------------------------------------------------------
Net increase (decrease) (52,151) $ (993,311) 334,685 $ 6,154,227
================================================================
- ----------------------------------------------------------------- ---------------------------------
CLASS C
Sold 336,486 $ 6,733,091 975,644 $ 17,699,486
Dividends and/or
distributions reinvested -- -- 67,708 1,228,966
Redeemed (387,709) (7,647,262) 1 (360,930) (6,518,901) 2
----------------------------------------------------------------
Net increase (decrease) (51,223) $ (914,171) 682,422 $ 12,409,551
================================================================
32 | OPPENHEIMER INTERNATIONAL VALUE FUND
SIX MONTHS ENDED OCTOBER 31, 2007 YEAR ENDED APRIL 30, 2007
SHARES AMOUNT SHARES AMOUNT
- ------------------------------------------------------------------------------------------------
CLASS Y
Sold 517,150 $ 10,577,948 -- $ --
Dividends and/or
distributions reinvested -- -- -- --
Redeemed (14,780) (304,408) 1 -- --
-------------------------------------------------------------
Net increase 502,370 $ 10,273,540 -- $ --
=============================================================
1. Net of redemption fees of $1,600, $268, $471 and $2 for Class A, Class B,
Class C and Class Y shares, respectively.
2. Net of redemption fees of $2,460, $457 and $783 for Class A, Class B and
Class C shares, respectively.
- --------------------------------------------------------------------------------
3. PURCHASES AND SALES OF SECURITIES
The aggregate cost of purchases and proceeds from sales of securities, other
than short-term obligations and investments in IMMF, for the six months ended
October 31, 2007, were as follows:
PURCHASES SALES
- --------------------------------------------------------------
Investment securities $ 75,558,724 $ 68,446,004
- --------------------------------------------------------------------------------
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 average net assets as shown in the following table:
FEE SCHEDULE
- ---------------------------------
Up to $500 million 0.85%
Next $500 million 0.75
Over $1.0 billion 0.70
- --------------------------------------------------------------------------------
TRANSFER AGENT FEES. OppenheimerFunds Services (OFS), a division of the Manager,
acts as the transfer and shareholder servicing agent for the Fund. The Fund pays
OFS a per account fee. For the six months ended October 31, 2007, the Fund paid
$181,896 to OFS for services to the Fund.
Additionally, Class Y shares are subject to minimum fees of $10,000 per
annum for assets of $10 million or more. The Class Y shares are subject to the
minimum fees in the event that the per account fee does not equal or exceed the
applicable minimum fees. OFS may voluntarily waive the minimum fees.
- --------------------------------------------------------------------------------
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
periodically at an annual rate of up to 0.25% of the average annual net assets
of Class A shares of the Fund. The
33 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
4. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued
Distributor currently uses all of those fees to pay dealers, brokers, banks and
other financial institutions periodically for providing personal services and
maintenance of accounts of their customers that hold Class A shares. Any
unreimbursed expenses the Distributor incurs with respect to Class A shares in
any fiscal year cannot be recovered in subsequent periods. 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
determines its uncompensated expenses under the plan at calendar quarter ends.
The Distributor's aggregate uncompensated expenses under the plan at September
30, 2007 for Class B and Class C shares were $354,951 and $242,884,
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 following table for the period
indicated.
CLASS A CLASS B CLASS C
CLASS A CONTINGENT CONTINGENT CONTINGENT
FRONT-END DEFERRED DEFERRED DEFERRED
SALES CHARGES SALES CHARGES SALES CHARGES SALES CHARGES
SIX MONTHS RETAINED BY RETAINED BY RETAINED BY RETAINED BY
ENDED DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR DISTRIBUTOR
- --------------------------------------------------------------------------------
October 31, 2007 $ 85,721 $ 50,794 $ 17,204 $ 1,799
- --------------------------------------------------------------------------------
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 expenses" or "Expenses after payments, waivers and/or reimbursements and
reduction to custodian expenses" will not exceed 1.70% for Class A shares, 2.45%
for Class B shares and Class C shares and 1.45% for Class Y shares. The
voluntary waiver and/or expense reimbursements may be amended or withdrawn at
any time without prior notice to shareholders.
34 | OPPENHEIMER INTERNATIONAL VALUE FUND
Effective September 1, 2007, the Manager has voluntarily agreed to waive a
portion of the advisory fee so that the advisory fee on the Fund's daily net
assets over $2.0 billion is 0.67%. This voluntary waiver may be withdrawn at any
time.
OFS has voluntarily agreed to limit transfer and shareholder servicing
agent fees for all classes to 0.35% of average annual net assets per class. This
undertaking may be amended or withdrawn at any time.
The Manager will waive fees and/or reimburse Fund expenses in an amount
equal to the indirect management fees incurred through the Fund's investment in
IMMF. During the six months ended October 31, 2007, the Manager waived $3,141
for IMMF management fees.
- --------------------------------------------------------------------------------
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.
As of October 31, 2007, the Fund had outstanding foreign currency contracts as
follows:
CONTRACT VALUATION
EXPIRATION AMOUNT AS OF UNREALIZED UNREALIZED
CONTRACT DESCRIPTION DATES (000S) OCT. 31, 2007 APPRECIATION DEPRECIATION
- -------------------------------------------------------------------------------------------------------------
CONTRACTS TO PURCHASE
Hong Kong Dollar [HKD] 11/1/07-11/6/07 896 HKD $ 115,660 $ 1 $ 2
Japanese Yen [JPY] 11/1/07-11/2/07 7,120 JPY 61,719 -- 361
South Korean Won [KRW] 11/1/07 32,846 KRW 36,468 203 --
-----------------------------
204 363
-----------------------------
CONTRACTS TO SELL
Euro [EUR] 11/1/07-2/29/08 10,334 EUR 14,987,196 -- 356,639
Japanese Yen [JPY] 2/29/08 710,000 JPY 6,238,421 13,890 --
-----------------------------
13,890 356,639
-----------------------------
Total unrealized appreciation and depreciation $ 14,094 $ 357,002
=============================
35 | OPPENHEIMER INTERNATIONAL VALUE FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
6. OPTION ACTIVITY
The Fund may buy and sell put and call options, or write put and covered call
options on portfolio securities in order to produce incremental earnings or
protect against changes in the value of portfolio securities.
The Fund generally purchases put options or writes covered call options to
hedge against adverse movements in the value of portfolio holdings. When an
option is written, the Fund receives a premium and becomes obligated to sell or
purchase the underlying security at a fixed price, upon exercise of the option.
Options are valued daily based upon the last sale price on the principal
exchange on which the option is traded and unrealized appreciation or
depreciation is recorded. The Fund will realize a gain or loss upon the
expiration or closing of the option transaction. When an option is exercised,
the proceeds on sales for a written call option, the purchase cost for a written
put option, or the cost of the security for a purchased put or call option is
adjusted by the amount of premium received or paid. Securities designated to
cover outstanding call or put options are noted in the Statement of Investments
where applicable. Contracts subject to call or put, expiration date, exercise
price, premium received and market value are detailed in a note to the Statement
of Investments. Options written are reported as a liability in the Statement of
Assets and Liabilities. Realized gains and losses are reported in the Statement
of Operations.
The risk in writing a call option is that the Fund gives up the
opportunity for profit if the market price of the security increases and the
option is exercised. The risk in writing a put option is that the Fund may incur
a loss if the market price of the security decreases and the option is
exercised. The risk in buying an option is that the Fund pays a premium whether
or not the option is exercised. The Fund also has the additional risk of not
being able to enter into a closing transaction if a liquid secondary market does
not exist.
Written option activity for the six months ended October 31, 2007 was as
follows:
CALL OPTIONS
---------------------------
NUMBER OF AMOUNT OF
CONTRACTS PREMIUMS
- -------------------------------------------------------
Options outstanding as of
April 30, 2007 -- $ --
Options written 507 89,816
---------------------------
Options outstanding as of
October 31, 2007 507 $ 89,816
===========================
- --------------------------------------------------------------------------------
7. ILLIQUID SECURITIES
As of October 31, 2007, investments in securities included issues that are
illiquid. A security may be considered illiquid if it lacks a readily available
market or if its valuation has not changed for a certain period of time. The
Fund will not invest more than 15% of its net assets (determined at the time of
purchase and reviewed periodically) in illiquid securities. Securities that are
illiquid are marked with the applicable footnote on the Statement of
Investments.
36 | OPPENHEIMER INTERNATIONAL VALUE FUND
- --------------------------------------------------------------------------------
8. SECURITIES LENDING
The Fund lends portfolio securities from time to time in order to earn
additional income. In return, the Fund receives collateral in the form of
securities, letters of credit or cash, against the loaned securities and
maintains collateral in an amount not less than 100% of the market value of the
loaned securities during the period of the loan. The market value of the loaned
securities is determined at the close of business each day. If the Fund is
undercollateralized at the close of business due to an increase in market value
of securities on loan, additional collateral is requested from the borrowing
counterparty and is delivered to the Fund on the next business day. Cash
collateral may be invested in approved investments and the Fund bears the risk
of any loss in value of these investments. The Fund retains a portion of the
interest earned from the collateral. If the borrower defaults on its obligation
to return the securities loaned because of insolvency or other reasons, the Fund
could experience delays and cost in recovering the securities loaned or in
gaining access to the collateral. The Fund continues to receive the economic
benefit of interest or dividends paid on the securities loaned in the form of a
substitute payment received from the borrower. As of October 31, 2007, the Fund
had no securities on loan.
- --------------------------------------------------------------------------------
9. RECENT ACCOUNTING PRONOUNCEMENT
In September 2006, Financial Accounting Standards Board issued Statement of
Financial Accounting Standards ("SFAS") No. 157, Fair Value Measurements. This
standard establishes a single authoritative definition of fair value, sets out a
framework for measuring fair value and expands disclosures about fair value
measurements. SFAS No. 157 applies to fair value measurements already required
or permitted by existing standards. SFAS No. 157 is effective for financial
statements issued for fiscal years beginning after November 15, 2007, and
interim periods within those fiscal years. As of October 31, 2007, the Manager
does not believe the adoption of SFAS No. 157 will materially impact the
financial statement amounts; however, additional disclosures may be required
about the inputs used to develop the measurements and the effect of certain of
the measurements on changes in net assets for the period.
- --------------------------------------------------------------------------------
10. SUBSEQUENT EVENT
Effective November 16, 2007, the Fund will offer Class N shares.
37 | OPPENHEIMER INTERNATIONAL VALUE FUND
PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES;
UPDATES TO STATEMENTS OF INVESTMENTS Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
The Fund has adopted Portfolio Proxy Voting Policies and Procedures under which
the Fund votes proxies relating to securities ("portfolio proxies") held by the
Fund. A description of the Fund's Portfolio Proxy Voting Policies and Procedures
is available (i) without charge, upon request, by calling the Fund toll-free at
1.800.525.7048, (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.
38 | OPPENHEIMER INTERNATIONAL VALUE FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Each year, the Board of Trustees (the "Board"), including a majority of the
independent Trustees, is required to determine whether to renew the Fund's
investment advisory agreement (the "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 Agreement. The Board employs an independent consultant to prepare a
report that provides information, including comparative information, that the
Board requests for that purpose. In addition, the Board receives information
throughout the year regarding Fund services, fees, expenses and performance.
The Manager and the independent consultant provided information to the
Board on the following factors: (i) the nature, quality and extent of the
Manager's services, (ii) the investment performance of the Fund and the Manager,
(iii) the fees and expenses of the Fund, including comparative expense
information, (iv) the profitability of the Manager and its affiliates, including
an analysis of the cost of providing services by the Manager and its affiliates,
(v) the extent to which economies of scale are realized as the Fund grows and
whether fee levels reflect these economies of scale for Fund investors and (vi)
other benefits to the Manager from its relationship with the Fund. The Board was
aware that there are alternatives to retaining the Manager.
NATURE AND EXTENT OF SERVICES. The Board considered information about the
nature and extent of the services provided to the Fund and information regarding
the Manager's key personnel who provide such services. The Manager's duties
include providing the Fund with 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; securities trading services;
oversight of third party service providers; monitoring compliance with
applicable Fund policies and procedures and adherence to the Fund's investment
restrictions. The Manager is responsible for providing certain administrative
services to the Fund as well. Those services include providing and supervising
all administrative and clerical personnel who are necessary in order to provide
effective corporate administration for the Fund; compiling and maintaining
records with respect to the Fund's operations; preparing and filing reports
required by the Securities and Exchange Commission; preparing periodic reports
regarding the operations of the Fund for its shareholders; preparing proxy
materials for shareholder meetings; and preparing the registration statements
required by Federal and state securities laws for the sale of the Fund's shares.
The Manager also provides the Fund with office space, facilities and equipment.
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 took account of the fact 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
39 | OPPENHEIMER INTERNATIONAL VALUE FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT
ADVISORY AGREEMENT Unaudited / Continued
- --------------------------------------------------------------------------------
managers in the United States. The Board evaluated the Manager's administrative,
accounting, legal and compliance services, and information the Board has
received regarding the experience and professional qualifications of the
Manager's personnel and the size and functions of its staff. In its evaluation
of the quality of the portfolio management services provided, the Board
considered the experience of Dominic Freud, the portfolio manager for the Fund,
and the Manager's Global investment team and analysts. The Board members also
considered their experiences with the Manager and its officers and other
personnel through their service on the Boards of the Fund and other funds
advised by the Manager. The Board considered information regarding the quality
of services provided by affiliates of the Manager, which its members have become
knowledgeable about in connection with the renewal of the Fund's service
agreements. In light of the foregoing, the Board concluded that the Fund
benefits from the services provided under the Agreement and from the Manager's
experience, reputation, personnel, operations, and resources.
INVESTMENT PERFORMANCE OF THE MANAGER AND THE FUND. During the year, the
Manager provided information on the investment performance of the Fund and the
Manager at each regular quarterly Board meeting, including comparative
performance information. The Board also 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 retail
front-end load and no-load international multi-cap value funds advised by the
Manager and by other investment advisers. The Board noted that the Fund's
three-year performance was better than its peer group median. However its
one-year and since inception performance were below its peer group median.
MANAGEMENT FEES AND EXPENSES. The Board reviewed the fees paid to the
Manager and its affiliates and the other expenses borne by the Fund. The Board
also considered the comparability of the fees charged and the services provided
to the Fund to the fees and services for other clients or accounts advised by
the Manager. The independent consultant provided comparative data in regard to
the fees and expenses of the Fund, other international multi-cap value funds and
international large-cap core funds and other funds with comparable asset levels
and distribution features. The Board noted that the Manager has agreed to
voluntarily waive 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, 1.95% for Class N shares, and 1.45% for
Class Y shares. The voluntary waiver and/or expense reimbursement may be amended
or withdrawn at any time without prior notice to shareholders. The Board noted
that the Fund's contractual management fees and total expenses are lower than
its peer group median although its actual management fees are higher than its
peer group median.
40 | OPPENHEIMER INTERNATIONAL VALUE FUND
ECONOMIES OF SCALE. The Board reviewed the extent to which the Manager may
realize economies of scale in managing and supporting the Fund, the extent to
which those economies of scale benefit the Fund's shareholders and the current
level of Fund assets in relation to the Fund's breakpoint schedule for its
management fees. The Board also noted the Fund's breakpoints, which are intended
to share economies of scale that may exist as the Fund grows with its
shareholders. Based on this evaluation, the Board requested and the Manager
agreed to voluntarily waive a portion of the management fees after September 1,
2007, so that the management fee on the Fund's daily net assets over $2.0
billion is 0.67%. The voluntary waiver and/or expense reimbursement may be
amended or withdrawn at any time without prior notice to shareholders.
BENEFITS TO THE MANAGER. The Board considered information regarding the
Manager's costs in serving as the Fund's investment adviser, including the costs
associated with the personnel and systems necessary to manage the Fund, and
information regarding the Manager's profitability from its relationship with the
Fund. 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 to considering the profits
realized by the Manager, the Board considered information 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 for services
provided and research provided to the Manager in connection with permissible
brokerage arrangements (soft dollar arrangements).
CONCLUSIONS. These factors were also considered by the independent
Trustees meeting separately from the full Board, assisted by experienced counsel
to the Fund and the independent Trustees. Fund counsel is independent of the
Manager within the meaning and intent of the Securities and Exchange Commission
Rules.
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, and the revised management fee
structure adopted by the Board and the Manager, are reasonable in relation to
the services provided. Accordingly, the Board elected to continue the 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 Agreement,
including the management fee, in light of all of the surrounding circumstances.
41 | OPPENHEIMER INTERNATIONAL VALUE FUND
ITEM 2. CODE OF ETHICS.
Not applicable to semiannual reports.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable to semiannual reports.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable to semiannual reports.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to semiannual reports.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES 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 FUND'S GOVERNANCE COMMITTEE PROVISIONS WITH RESPECT TO NOMINATIONS OF
DIRECTORS/TRUSTEES TO THE RESPECTIVE BOARDS
1. The Fund's Governance Committee (the "Committee") will evaluate potential
Board candidates to assess their qualifications. The Committee shall have
the authority, upon approval of the Board, to retain an executive search
firm to assist in this effort. The Committee may consider recommendations
by business and personal contacts of current Board members and by executive
search firms which the Committee may engage from time to time and may also
consider shareholder recommendations. The Committee may consider the advice
and recommendation of the Funds' investment manager and its affiliates in
making the selection.
2. The Committee shall screen candidates for Board membership. The Committee
has not established specific qualifications that it believes must be met by
a trustee nominee. In evaluating trustee nominees, the Committee considers,
among other things, an individual's background, skills, and experience;
whether the individual is an "interested person" as defined in the
Investment Company Act of 1940; and
whether the individual would be deemed an "audit committee financial
expert" within the meaning of applicable SEC rules. The Committee also
considers whether the individual's background, skills, and experience will
complement the background, skills, and experience of other nominees and
will contribute to the Board. There are no differences in the manner in
which the Committee evaluates nominees for trustees based on whether the
nominee is recommended by a shareholder.
3. The Committee may consider nominations from shareholders for the Board at
such times as the Committee meets to consider new nominees for the Board.
The Committee shall have the sole discretion to determine the candidates to
present to the Board and, in such cases where required, to shareholders.
Recommendations for trustee nominees should, at a minimum, be accompanied
by the following:
o the name, address, and business, educational, and/or other pertinent
background of the person being recommended;
o a statement concerning whether the person is an "interested person" as
defined in the Investment Company Act of 1940;
o any other information that the Funds would be required to include in a
proxy statement concerning the person if he or she was nominated; and
o the name and address of the person submitting the recommendation and,
if that person is a shareholder, the period for which that person held
Fund shares.
The recommendation also can include any additional information which the
person submitting it believes would assist the Committee in evaluating the
recommendation.
4. Shareholders should note that a person who owns securities issued by
Massachusetts Mutual Life Insurance Company (the parent company of the
Funds' investment adviser) would be deemed an "interested person" under the
Investment Company Act of 1940. In addition, certain other relationships
with Massachusetts Mutual Life Insurance Company or its subsidiaries, with
registered broker-dealers, or with the Funds' outside legal counsel may
cause a person to be deemed an "interested person."
5. Before the Committee decides to nominate an individual as a trustee,
Committee members and other directors customarily interview the individual
in person. In addition, the individual customarily is asked to complete a
detailed questionnaire which is designed to elicit information which must
be disclosed under SEC and stock exchange rules and to determine whether
the individual is subject to any statutory disqualification from serving as
a trustee of a registered investment company.
ITEM 11. CONTROLS AND PROCEDURES.
Based on their evaluation of the 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 10/31/2007, the registrant's principal executive officer and
principal financial officer found the registrant's disclosure controls and
procedures to provide reasonable assurances that information required to be
disclosed by the 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.
There have been no changes in the registrant's internal controls over financial
reporting that occurred during the registrant's second fiscal quarter of the
period covered by this report that have materially affected, or are reasonably
likely to materially affect, the registrant's internal control over financial
reporting.
ITEM 12. EXHIBITS.
(a) (1) Not applicable to semiannual reports.
(2) Exhibits attached hereto.
(3) Not applicable.
(b) Exhibit attached hereto.
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 Trust
By: /s/ John V. Murphy
---------------------------
John V. Murphy
Principal Executive Officer
Date: 12/11/2007
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: 12/11/2007
By: /s/ Brian W. Wixted
---------------------------
Brian W. Wixted
Principal Financial Officer
Date: 12/11/2007