UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-05871
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Centennial California Tax Exempt Trust
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(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: June 30
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Date of reporting period: 06/30/2008
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ITEM 1. REPORTS TO STOCKHOLDERS.
June 30, 2008
Centennial Annual Report
California and
Tax Exempt Trust Management
Commentaries
TRUST EXPENSES
TRUST EXPENSES. As a shareholder of the Trust, you incur ongoing costs,
including management fees; distribution and service fees; and other Trust
expenses. These examples are intended to help you understand your ongoing costs
(in dollars) of investing in the Trust 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 June 30, 2008.
ACTUAL EXPENSES. The first section of the table provides information about
actual account values and actual expenses. You may use the information in this
section, 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 first section 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 second section of the table
provides information about hypothetical account values and hypothetical expenses
based on the Trust's actual expense ratio, and an assumed rate of return of 5%
per year before expenses, which is not the 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 Trust and other
funds. To do so, compare this 5% hypothetical example 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), or a $12.00 fee imposed annually
on accounts valued at less than $500.00 (subject to exceptions described in the
Statement of Additional Information). Therefore, the "hypothetical" section of
the table is 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.
5 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
TRUST EXPENSES Continued
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT PAID DURING
VALUE VALUE 6 MONTHS ENDED
ACTUAL JANUARY 1, 2008 JUNE 30, 2008 JUNE 30, 2008
- ------ --------------- ------------- --------------
$1,000.00 $1,007.60 $3.75
HYPOTHETICAL
(5% return before expenses)
- --------------------------- --------------- ------------- --------------
1,000.00 1,021.13 3.78
Expenses are equal to the Trust's annualized expense ratio, multiplied by the
average account value over the period, multiplied by 182/366 (to reflect the
one-half year period). The annualized expense ratio, based on the 6-month period
ended June 30, 2008 is as follows:
EXPENSE RATIO
- -------------
0.75%
The expense ratio reflects reduction to custodian expenses and voluntary waivers
or reimbursements of expenses by the Trust's Transfer Agent that can be
terminated at any time, without advance notice. The "Financial Highlights" table
in the Trust's financial statements, included in this report, also show the
gross expense ratio, without such waivers or reimbursements and reduction to
custodian expenses, if applicable.
6 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
STATEMENT OF INVESTMENTS June 30, 2008
PRINCIPAL
AMOUNT VALUE
----------- --------------
SHORT-TERM TAX-EXEMPT OBLIGATIONS--98.4%
CALIFORNIA--94.2%
Alameda, CA PFAU RRB, Alameda Point Improvement Project,
Series 2003A, 1.53%(1) $ 1,000,000 $ 1,000,000
CA ABAG FAU for Nonprofit Corps RB, YMCA San Francisco, Series B,
1.35%(1) 1,400,000 1,400,000
CA Department of Water Resources Power Supply RRB, Subseries 2005
F-1, 1.60%(1) 750,000 750,000
CA Dept. of Water Resources Power Supply RB, Series C-9, 1.26%(1) 1,300,000 1,300,000
CA EDLFA Pepperdine University RRB, Eclipse Funding Trust Solar
Eclipse Certificates-Series 2006-0065, 1.53%(1, 2) 2,200,000 2,200,000
CA EDLFA RB, University of San Francisco, Series 2003, 1.30%(1) 1,250,000 1,250,000
CA Enterprise DAU RB, Sconza Candy Co. Project, Series A, 1.70%(1) 3,000,000 3,000,000
CA GOUN, MSTFC Series 2178, 1.57%(1, 2) 6,091,000 6,091,000
CA GOUN, SPEARS Deutsche Bank/Lifers Trust-Series DBE-637,
1.62%(1, 2) 13,000,000 13,000,000
CA GOUN, SPEARS Deutsche Bank/Lifers Trust-Series DBE-648,
1.62%(1, 2) 3,510,000 3,510,000
CA I&E Development Bank IDV RRB, Lance Camper Manufacturing Corp.,
Series 2000A, 1.75%(1) 2,000,000 2,000,000
CA I&E Development Bank RB, Starter & Alternator Project, Series
1999, 1.69%(1) 3,900,000 3,900,000
CA Municipal FAU MH RB, PTTR, Series 2410, 1.70%(1, 2) 1,100,000 1,100,000
CA PCFAU SWD RB, AVI-PGS Project, Series 2008A, 1.70%(1) 2,815,000 2,815,000
CA PCFAU SWD RB, Garaventa Enterprises, Inc., Series 2008A, 1.70%(1) 1,000,000 1,000,000
CA PCFAU SWD RB, Garden City Sanitation, Series A, 1.75%(1) 2,615,000 2,615,000
CA PCFAU SWD RB, George Borba & Son Dairy Project, 1.71%(1) 3,800,000 3,800,000
CA PCFAU SWD RB, Greenwaste Recovery, Inc. Project, Series 2007A,
1.75%(1) 3,190,000 3,190,000
CA PCFAU SWD RB, Greenwaste Recovery, Inc. Project, Series A,
1.75%(1) 1,680,000 1,680,000
CA PCFAU SWD RB, Marin San Services Project, Series A, 1.75%(1) 1,300,000 1,300,000
CA PCFAU SWD RB, Penas Disposal, Inc. Project, Series A, 1.75%(1) 1,255,000 1,255,000
CA PCFAU SWD RB, Sunset Waste Paper, Inc. Project, 1.75%(1) 2,750,000 2,750,000
CA PCFAU SWD RB, Sunset Waste Paper, Inc. Project, Series A, 1.75%(1) 1,905,000 1,905,000
CA PCFAU SWD RB, Vanderham/J&D Wilson Dairy Project, Series 2004,
1.71%(1) 2,500,000 2,500,000
CA RB, SPEARS Deutsche Bank/Lifers Trust-Series DB-477, 1.62%(1, 2) 6,025,000 6,025,000
CA REF GOUN, P-Floats Series PT-4166, 1.57%(1, 2) 4,980,000 4,980,000
CA REF GOUN, Series 2004 A-6, 1.20%(1, 3) 1,840,000 1,840,000
CA REF GOUN, Series 2004 B-2, 1.45%(1) 2,100,000 2,100,000
CA REF GOUN, Series 2004 B-4, 1.20%(1) 3,950,000 3,950,000
CA SCDAU MH RB, PTTR, Series 2681, 1.80%(1, 2) 500,000 500,000
CA SCDAU MH RB, Reset Option Certificates II-R Trust-Series 779CE,
1.77%(1, 2) 4,520,000 4,520,000
F1 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
STATEMENT OF INVESTMENTS Continued
PRINCIPAL
AMOUNT VALUE
----------- --------------
CALIFORNIA Continued
CA SCDAU MH RRB, PTTR, IAC Project, Series 2680, 1.65%(1, 2) $10,000,000 $ 10,000,000
CA SCDAU RB, House Ear Institute Project, Series 2007, 1.65%(1) 7,910,000 7,910,000
CA SCDAU RRB, Archer School for Girls, Inc., Series 05, 1.50%(1) 775,000 775,000
East Bay, CA MUD WS RRB, Subseries B, 1.23%(1) 11,400,000 11,400,000
Foothill-De Anza, CA Community College District GOUN, Series 1844,
1.61%(1, 2) 4,950,000 4,950,000
Foothill/Eastern Corridor Agency, CA Toll Road RB, Sr. Lien,
Series A, 7.05%, 1/1/09 5,000,000 5,100,777
Grant, CA Joint Union High School District COP, School Facility
Bridge Funding Program, 1.70%(1) 5,000,000 5,000,000
Hacienda La Puente, CA USD REF GOUN, P-Floats Series PT-2877,
1.53%(1, 2) 4,400,000 4,400,000
Hayward, CA HAU MH RRB, Barrington Hill Apts. Project, Series 1995A,
1.32%(1) 1,700,000 1,700,000
Hesperia, CA USD COP, Interim School Facilities Funding Program,
Series 2004, 1.60%(1) 1,000,000 1,000,000
Irvine, CA Public Facilities & Infrastructure Authority Lease RB,
Capital Improvement Projects, 1.31%(1) 1,140,000 1,140,000
Irvine, CA USD SPTX Bonds, Austin Trust Certificates-Series BOA 315,
1.62%(1, 2) 6,000,000 6,000,000
Loma Linda, CA Hospital RB, Loma Linda University Medical Center,
1.20%(1, 3) 4,700,000 4,700,000
Los Angeles Cnty., CA MTAU Proposal A Sales Tax RRB, Series 03, 3%,
7/1/08 2,315,000 2,315,000
Los Angeles Cnty., CA MTAU Proposal C Sales Tax RB, Series A, 1.40%,
8/14/08 2,500,000 2,500,000
Los Angeles, CA Municipal Improvement Corp. RB, Series A-1&2, 1.42%,
7/3/08 1,200,000 1,200,000
Los Angeles, CA Municipal Improvement Corp. RB, Series A-1&2, 1.50%,
9/10/08 1,000,000 1,000,000
Los Angeles, CA Municipal Improvement Corp. RB, Series A-1&2, 1.52%,
10/9/08 1,000,000 1,000,000
Los Angeles, CA Municipal Improvement Corp. RB, Series A-1&2, 1.60%,
11/3/08 1,750,000 1,750,000
Los Angeles, CA Municipal Improvement Corp. RB, Series A-1&2, 1.60%,
11/21/08 2,000,000 2,000,000
Los Angeles, CA Wastewater System RB, Reset Option Certificates II-R
Trust-Series 10270, 1.54%(1, 2) 1,000,000 1,000,000
Pasadena, CA REF COP, Series A, 1.35%(1) 1,535,000 1,535,000
Roseville, CA Joint Union High SDI COP, Series 2003, 1.60%(1) 1,165,000 1,165,000
Sacramento Cnty., CA HAU MH RB, Reset Option Certificates II-R
Trust-Series 10010CE, 1.70%(1, 2) 3,000,000 3,000,000
Sacramento Cnty., CA HAU MH RB, Reset Option Certificates II-R
Trust-Series 823CE, 1.67%(1, 2) 1,080,000 1,080,000
Sacramento, CA MUD RB, Series J, 1.35%, 8/8/08 4,000,000 4,000,000
F2 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
PRINCIPAL
AMOUNT VALUE
----------- --------------
CALIFORNIA Continued
San Bernardino Cnty., CA MH HAU RRB, Somerset Apts.-A, 1.31%(1) $ 795,000 $ 795,000
San Diego Cnty., CA COP, Sidney Kimmel Cancer Center, 1.35%(1) 845,000 845,000
San Diego, CA PFFAU Water RB, PTTR, Series 2595, 1.55%(1, 2) 6,240,000 6,240,000
San Francisco City & Cnty., CA PUC Wastewater RB, 1.05%, 8/11/08 2,500,000 2,500,000
San Francisco City & Cnty., CA PUC Wastewater RB, 1.50%, 9/3/08 2,000,000 2,000,000
San Francisco, CA City & Cnty. MH RB, Geary Court, Goldman Sachs Pool
Trust-Series 2007-124G, 1.55%(1, 2) 9,500,000 9,500,000
San Francisco, CA City & Cnty., RA RB, CFD No. 4, 1.50%(1) 650,000 650,000
San Joaquin, CA Transportation Authority Sales Tax RB, 0.70%, 8/12/08 2,500,000 2,500,000
Turlock, CA Irrigation District RB, Series A, 1.20%, 7/10/08 1,000,000 1,000,000
Vacaville, CA USD GOUN, Eclipse Funding Trust Solar Eclipse
Certificates-Series 2007-0079, 1.53%(1, 2) 10,300,000 10,300,000
Vallejo, CA HAU MH RRB, Fountain Plaza Hills Apts., 1.70%(1) 2,435,000 2,435,000
Victorville, CA Joint Powers FAU Lease RRB, CoGeneration Facilities,
Series 2007A, 1.50%(1) 11,000,000 11,000,000
Yosemite, CA Community College District GOUN,
Reset Option Certificates II-R Trust-Series 11385, 1.55%(1, 2) 1,000,000 1,000,000
Yosemite, CA Community College District GOUN,
Reset Option Certificates II-R Trust-Series 12225, 1.55%(1, 2) 1,500,000 1,500,000
--------------
229,111,777
U.S. POSSESSIONS--4.2%
Puerto Rico CMWLTH HTAU RRB, Dexia Credit Local Certificates
Trust-Series 2008-008, 1.55%(1, 2) 35,000 35,000
Puerto Rico Electric PAU RRB, Dexia Credit Local Certificates
Trust-Series 2008-013, 1.55%(1, 2) 7,050,000 7,050,000
Puerto Rico EPAU RRB, Municipal Trust Securities, Series 2006,
1.57%(1, 2) 2,000,000 2,000,000
Puerto Rico Sales Tax Finance Corp. RRB, SPEARS Deutsche
Bank/Lifers Trust-Series DBE-627A, 1.55%(1, 2) 1,295,000 1,295,000
--------------
10,380,000
TOTAL INVESTMENTS, AT VALUE (COST $239,491,777) 98.4% 239,491,777
OTHER ASSETS NET OF LIABILITIES 1.6 3,802,130
----------- --------------
NET ASSETS 100.0% $ 243,293,907
=========== ==============
INDUSTRY CLASSIFICATIONS ARE UNAUDITED.
F3 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
STATEMENT OF INVESTMENTS Continued
FOOTNOTES TO STATEMENT OF INVESTMENTS
TO SIMPLIFY THE LISTINGS OF SECURITIES, ABBREVIATIONS ARE USED PER THE TABLE
BELOW:
ABAG Association of Bay Area Governments
CFD Community Facilities District
CMWLTH Commonwealth
COP Certificates of Participation
DAU Development Authority
EDLFA Educational Facilities Authority
EPAU Electric Power Authority
FAU Finance Authority
GOUN General Obligation Unlimited Nts.
HAU Housing Authority
HTAU Highway & Transportation Authority
I&E Infrastructure and Economic
IDV Industrial Development
MH Multifamily Housing
MSTFC Morgan Stanley & Co., Inc. Trust Floater Certificates
MTAU Metropolitan Transportation Authority
MUD Municipal Utility District
P-Floats Puttable Floating Option Tax Exempt Receipts
PAU Power Authority
PCFAU Pollution Control Finance Authority
PFAU Public Finance Authority
PFFAU Public Facilities Finance Authority
PTTR Puttable Tax Exempt Receipts
PUC Public Utilities Commission
RA Redevelopment Agency/Authority
RB Revenue Bonds
REF Refunding
RRB Revenue Refunding Bonds
SCDAU Statewide Communities Development Authority
SDI School District
SPEARS Short Puttable Exempt Adjustable Receipts
SPTX Special Tax
SWD Solid Waste Disposal
USD Unified School District
WS Water System
YMCA Young Men's Christian Assoc.
(1.) Floating or variable rate obligation maturing in more than one year. The
interest rate, which is based on specific, or an index of, market interest
rates, is subject to change periodically and is the effective rate on June
30, 2008. This instrument has a demand feature which allows, on up to 30
days' notice, the recovery of principal at any time, or at specified
intervals not exceeding one year.
(2.) Represents securities sold under Rule 144A, which are exempt from
registration under the Securities Act of 1933, as amended. These securities
have been determined to be liquid under guidelines established by the Board
of Trustees. These securities amount to $111,276,000 or 45.74% of the
Trust's net assets as of June 30, 2008.
(3.) When-issued security or delayed delivery to be delivered and settled after
June 30, 2008. See Note 1 of accompanying Notes.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F4 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
STATEMENT OF ASSETS AND LIABILITIES June 30, 2008
ASSETS
Investments, at value (cost $239,491,777)--see accompanying
statement of investments $239,491,777
Cash 10,677,539
Receivables and other assets:
Investments sold on a when-issued or delayed delivery basis 2,635,000
Interest 925,144
Other 11,519
------------
Total assets 253,740,979
LIABILITIES
Payables and other liabilities:
Investments purchased (including $1,840,000 purchased on a
when-issued or delayed delivery basis) 10,186,553
Distribution and service plan fees 121,715
Shareholder communications 47,103
Dividends 45,938
Trustees' compensation 4,757
Transfer and shareholder servicing agent fees 3,858
Other 37,148
------------
Total liabilities 10,447,072
NET ASSETS $243,293,907
============
COMPOSITION OF NET ASSETS
Paid-in capital $243,282,045
Accumulated net realized gain on investments 11,862
------------
NET ASSETS--applicable to 243,263,322 shares of beneficial
interest outstanding $243,293,907
============
NET ASSET VALUE, REDEMPTION PRICE PER SHARE AND OFFERING
PRICE PER SHARE $ 1.00
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F5 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
STATEMENT OF OPERATIONS For the Year Ended June 30, 2008
INVESTMENT INCOME
Interest $6,078,526
EXPENSES
Management fees 1,058,119
Service plan fees 423,308
Shareholder communications 57,256
Transfer and shareholder servicing agent fees 51,095
Trustees' compensation 7,441
Administration service fees 1,500
Custodian fees and expenses 1,095
Other 54,679
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Total expenses 1,654,493
Less reduction to custodian expenses (77)
Less waivers and reimbursements of expenses (13,204)
----------
Net expenses 1,641,212
NET INVESTMENT INCOME 4,437,314
NET REALIZED GAIN ON INVESTMENTS 30,772
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $4,468,086
==========
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F6 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED JUNE 30, 2008 2007
- ------------------- ------------ ------------
OPERATIONS
Net investment income $ 4,437,314 $ 5,411,827
Net realized gain 30,772 75,428
------------ ------------
Net increase in net assets resulting from
operations 4,468,086 5,487,255
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income (4,437,314) (5,411,827)
Distributions from net realized gain (64,816) (63,507)
BENEFICIAL INTEREST TRANSACTIONS
Net increase (decrease) in net assets resulting
from beneficial interest transactions 63,943,206 (2,691,893)
NET ASSETS
Total increase (decrease) 63,909,162 (2,679,972)
Beginning of period 179,384,745 182,064,717
------------ ------------
End of period $243,293,907 $179,384,745
============ ============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F7 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
FINANCIAL HIGHLIGHTS
YEAR ENDED JUNE 30, 2008 2007 2006 2005 2004
- ------------------- -------- -------- -------- -------- --------
PER SHARE OPERATING DATA
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
Income from investment operations--net
investment income and net realized gain .02(1) .03(1) .02(1) .01(1) --(2)
-------- -------- -------- -------- --------
Dividends and/or distributions to shareholders:
Dividends from net investment income (.02) (.03) (.02) (.01) --(2)
Distributions from net realized gain --(2) --(2) -- -- --
-------- -------- -------- -------- --------
Total dividends and/or distributions to shareholders (.02) (.03) (.02) (.01) --(2)
-------- -------- -------- -------- --------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00
======== ======== ======== ======== ========
TOTAL RETURN(3) 2.22% 2.91% 2.27% 1.13% 0.21%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $243,294 $179,385 $182,065 $165,862 $139,892
Average net assets (in thousands) $211,565 $190,423 $184,956 $148,312 $149,559
Ratios to average net assets:(4)
Net investment income 2.10% 2.84% 2.25% 1.11% 0.21%
Total expenses 0.78%(5,6) 0.77%(5) 0.76%(6) 0.77%(5) 0.78%(5,6)
(1.) Per share amounts calculated based on the average shares outstanding during
the period.
(2.) Less than $0.005 per share.
(3.) Assumes an investment on the business day before the first day of the
fiscal period, with all dividends and distributions reinvested in
additional shares on the reinvestment date, and redemption at the net asset
value calculated on the last business day of the fiscal period. Total
returns are not annualized for periods less than one full year. Returns do
not reflect the deduction of taxes that a shareholder would pay on trust
distributions or the redemption of trust shares.
(4.) Annualized for periods less than one full year.
(5.) Reduction to custodian expenses less than 0.005%.
(6.) Reimbursement of expenses less than 0.005%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F8 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
NOTES TO FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES
Centennial California Tax Exempt Trust (the "Trust") is registered under the
Investment Company Act of 1940, as amended, as a non-diversified, open-end
management investment company. The Trust's investment objective is to seek the
maximum current interest income exempt from federal and California personal
income taxes for individual investors as is consistent with the preservation of
capital. The Trust's investment adviser is Centennial Asset Management
Corporation (the "Manager"), a subsidiary of OppenheimerFunds, Inc. ("OFI").
The following is a summary of significant accounting policies consistently
followed by the Trust.
SECURITIES VALUATION. The net asset value of shares of the Trust is normally
determined twice each day, at Noon Eastern time and at 4:00 P.M. Eastern time on
each day the New York Stock Exchange (the "Exchange") is open for trading.
Securities are valued at cost adjusted by the amortization of discount or
premium to maturity (amortized cost), which approximates market value. If
amortized cost is determined not to approximate market value, the fair value of
the portfolio securities will be determined under procedures approved by the
Trust's Board of Trustees.
SECURITIES ON A WHEN-ISSUED OR DELAYED DELIVERY BASIS. The Trust may purchase
securities on a "when-issued" basis, and may purchase or sell securities on a
"delayed delivery" basis. "When-issued" or "delayed delivery" refers to
securities whose terms and indenture are available and for which a market
exists, but which are not available for immediate delivery. Delivery and payment
for securities that have been purchased by the Trust on a when-issued basis
normally takes place within six months and possibly as long as two years or more
after the trade date. During this period, such securities do not earn interest,
are subject to market fluctuation and may increase or decrease in value prior to
their delivery. The purchase of securities on a when-issued basis may increase
the volatility of the Trust's net asset value to the extent the Trust executes
such transactions while remaining substantially fully invested. When the Trust
engages in when-issued or delayed delivery transactions, it relies on the buyer
or seller, as the case may be, to complete the transaction. Their failure to do
so may cause the Trust to lose the opportunity to obtain or dispose of the
security at a price and yield it considers advantageous. The Trust maintains
internally designated assets with a market value equal to or greater than the
amount of its purchase commitments. The Trust may also sell securities that it
purchased on a when-issued basis or forward commitment prior to settlement of
the original purchase.
As of June 30, 2008, the Trust had purchased securities issued on a when-issued
or delayed delivery basis and sold securities issued on a delayed delivery basis
as follows:
WHEN-ISSUED OR DELAYED DELIVERY
BASIS TRANSACTIONS
-------------------------------
Purchased securities $1,840,000
Sold securities 2,635,000
F9 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
NOTES TO FINANCIAL STATEMENTS Continued
1. SIGNIFICANT ACCOUNTING POLICIES Continued
CONCENTRATION RISK. There are certain risks arising from geographic
concentration in any state. Certain economic, regulatory or political
developments occurring in the state may impair the ability of certain issuers of
municipal securities to pay principal and interest on their obligations.
FEDERAL TAXES. The Trust intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income to shareholders.
Therefore, no federal income or excise tax provision is required. The Trust
files income tax returns in U.S. federal and applicable state jurisdictions. The
statute of limitations on the Trust's tax return filings generally remain open
for the three preceding fiscal reporting period ends.
The tax components of capital shown in the following table represent
distribution requirements the Trust must satisfy under the income tax
regulations, losses the Trust may be able to offset against income and gains
realized in future years for federal income tax purposes.
UNDISTRIBUTED NET UNDISTRIBUTED ACCUMULATED LOSS
INVESTMENT INCOME LONG-TERM GAINS CARRYFORWARD(1, 2)
- ----------------- --------------- ------------------
$75,448 $3,550 $--
(1.) During the fiscal year ended June 30, 2008, the Trust did not utilize any
capital loss carryforwards.
(2.) During the fiscal year ended June 30, 2007, the Trust did not utilize any
capital loss carryforwards.
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 Trust.
The tax character of distributions paid during the years ended June 30, 2008 and
June 30, 2007 was as follows:
YEAR ENDED YEAR ENDED
JUNE 30, 2008 JUNE 30, 2007
------------- -------------
Distributions paid from:
Ordinary income $ 27,181 $5,411,827
Exempt-interest distributions 4,437,314 15,396
Long-term capital gain 37,635 48,111
---------- ----------
Total $4,502,130 $5,475,334
========== ==========
TRUSTEES' COMPENSATION. 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 Trust. For purposes of determining the amount owed to the
Trustee under the plan, deferred amounts
F10 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
are treated as though equal dollar amounts had been invested in shares of the
Trust or in other Oppenheimer funds selected by the Trustee. The Trust purchases
shares of the funds selected for deferral by the Trustee in amounts equal to his
or her deemed investment, resulting in a Trust 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 Trust, and
will not materially affect the Trust's assets, liabilities or net investment
income per share. Amounts will be deferred until distributed in accordance to
the compensation deferral plan.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS. Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations and
may differ from U.S. generally accepted accounting principles, are recorded on
the ex-dividend date. Income distributions, if any, are declared daily and paid
monthly. Capital gain distributions, if any, are declared and paid annually but
may be paid at other times to maintain the net asset value per share at $1.00.
INVESTMENT INCOME. Interest income is recognized on an accrual basis. Discount
and premium, which are included in interest income on the Statement of
Operations, are amortized or accreted daily.
CUSTODIAN FEES. "Custodian fees and expenses" in the Statement of Operations may
include interest expense incurred by the Trust 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 Trust pays
interest to its custodian on such cash overdrafts, to the extent they are not
offset by positive cash balances maintained by the Trust, 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 Trust
during the period. Such interest expense and other custodian fees may be paid
with these earnings.
SECURITY TRANSACTIONS. Security transactions are recorded on the trade date.
Realized gains and losses on securities sold are determined on the basis of
identified cost.
INDEMNIFICATIONS. The Trust'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 Trust. In the
normal course of business, the Trust may also enter into contracts that provide
general indemnifications. The Trust's maximum exposure under these arrangements
is unknown as this would be dependent on future claims that may be made against
the Trust. The risk of material loss from such claims is considered remote.
F11 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
NOTES TO FINANCIAL STATEMENTS Continued
1. SIGNIFICANT ACCOUNTING POLICIES Continued
OTHER. The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of increases and
decreases in net assets from operations during the reporting period. Actual
results could differ from those estimates.
2. SHARES OF BENEFICIAL INTEREST
The Trust has authorized an unlimited number of no par value shares of
beneficial interest. Transactions in shares of beneficial interest were as
follows:
YEAR ENDED JUNE 30, 2008 YEAR ENDED JUNE 30, 2007
---------------------------- ----------------------------
SHARES AMOUNT SHARES AMOUNT
------------ ------------- ------------ -------------
Sold 777,683,703 $ 777,683,703 592,354,857 $ 592,354,857
Dividends and/or
distributions
reinvested 4,369,292 4,369,292 5,298,759 5,298,759
Redeemed (718,109,789) (718,109,789) (600,345,509) (600,345,509)
------------ ------------- ------------ -------------
Net increase (decrease) 63,943,206 $ 63,943,206 (2,691,893) $ (2,691,893)
============ ============= ============ =============
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
MANAGEMENT FEES. Under the investment advisory agreement, the Trust pays the
Manager a management fee based on the daily net assets of the Trust at an annual
rate as shown in the following table:
FEE SCHEDULE
- ------------------
Up to $250 million 0.500%
Next $250 million 0.475
Next $250 million 0.450
Next $250 million 0.425
Over $1 billion 0.400
ADMINISTRATION SERVICE FEES. The Trust pays the Manager a fee of $1,500 per year
for preparing and filing the Trust's tax returns.
TRANSFER AGENT FEES. Shareholder Services, Inc. ("SSI") acts as the transfer and
shareholder servicing agent for the Trust. The Trust pays SSI a per account fee.
For the year ended June 30, 2008, the Trust paid $50,704 to SSI for services to
the Trust.
SERVICE PLAN (12B-1) FEES. The Trust has adopted a Service Plan (the "Plan"). It
reimburses Centennial Asset Management Corporation (the "Distributor"), for a
portion of its costs incurred for services provided to accounts that hold shares
of the Trust. Reimbursement is made periodically depending on asset size, at an
annual rate of up to 0.20% of the average annual net assets of the Trust. The
Distributor currently uses all of those fees (together with significant amounts
from the Manager's own resources) to pay
F12 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
dealers, brokers, banks and other financial institutions periodically for
providing personal service and maintenance of accounts of their customers that
hold shares of the Trust. Fees incurred by the Trust under the Plan are detailed
in the Statement of Operations.
WAIVERS AND REIMBURSEMENTS OF EXPENSES. The Manager has voluntarily undertaken
to assume certain expenses of the Trust in any fiscal year that exceed 0.80% of
the Trust's average annual net assets. The Manager has voluntarily undertaken to
waive receipt of its management fees to the extent necessary so that the Trust
may seek to maintain a positive yield. During the year ended June 30, 2008, the
Manager waived $13,204. The Manager reserves the right to amend or terminate
either voluntary expense assumption at any time.
SSI has voluntarily agreed to limit transfer and shareholder servicing
agent fees to 0.35% of average annual net assets of the Trust. This undertaking
may be amended or withdrawn at any time.
4. RECENT ACCOUNTING PRONOUNCEMENTS
In September 2006, the Financial Accounting Standards Board ("FASB") 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 June 30,
2008, 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.
In March 2008, FASB issued SFAS No. 161, DISCLOSURES ABOUT DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES. This standard requires enhanced disclosures
about derivative and hedging activities, including qualitative disclosures about
how and why the Trust uses derivative instruments, how these activities are
accounted for, and their effect on the Trust's financial position, financial
performance and cash flows. SFAS No. 161 is effective for financial statements
issued for fiscal years beginning after November 15, 2008 and interim periods
within those fiscal years. At this time, management is evaluating the
implications of SFAS No. 161 and its impact on the Trust's financial statements
and related disclosures.
F13 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS OF CENTENNIAL CALIFORNIA TAX EXEMPT
TRUST:
We have audited the accompanying statement of assets and liabilities of
Centennial California Tax Exempt Trust (the "Trust"), including the statement of
investments, as of June 30, 2008, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Trust's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
The Trust is not required to have, nor were we engaged to perform, an audit of
its internal control over financial reporting. Our audits included consideration
of internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Trust's internal control over
financial reporting. Accordingly, we express no such opinion. An audit also
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. Our procedures included confirmation
of securities owned as of June 30, 2008, by correspondence with the custodian
and brokers; where replies were not received from brokers, we performed other
auditing procedures. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of the
Trust as of June 30, 2008, the results of its operations for the year then
ended, the changes in its net assets for each of the two years in the period
then ended, and the financial highlights for each of the five years in the
period then ended, in conformity with accounting principles generally accepted
in the United States of America.
DELOITTE & TOUCHE LLP
Denver, Colorado
August 8, 2008
F14 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
FEDERAL INCOME TAX INFORMATION Unaudited
In early 2008, if applicable, shareholders of record received information
regarding all taxable dividends and distributions paid to them by the Trust
during calendar year 2007. Regulations of the U.S. Treasury Department require
the Trust to report this information to the Internal Revenue Service.
Recent tax legislation allows a regulated investment company to designate
distributions not designated as capital gain distributions, as either interest
related dividends or short-term capital gain dividends, both of which are exempt
from the U.S. withholding tax applicable to non U.S. taxpayers. For the fiscal
year ended June 30, 2008, $27,181 or 44.76% of the short-term capital gain
distribution paid and to be paid by the Trust qualifies as a short-term capital
gain dividend.
The foregoing information is presented to assist shareholders in reporting
distributions received from the Trust to the Internal Revenue Service. Because
of the complexity of the federal regulations which may affect your individual
tax return and the many variations in state and local tax regulations, we
recommend that you consult your tax advisor for specific guidance.
7 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
PORTFOLIO PROXY VOTING POLICIES AND PROCEDURES; UPDATES TO STATEMENTS OF
INVESTMENTS Unaudited
The Trust has adopted Portfolio Proxy Voting Policies and Procedures under which
the Trust votes proxies relating to securities ("portfolio proxies") held by the
Trust. A description of the Trust's Portfolio Proxy Voting Policies and
Procedures is available (i) without charge, upon request, by calling the Trust
toll-free at 1.800.525.7048, (ii) on the Trust's website at
www.oppenheimerfunds.com, and (iii) on the SEC's website at www.sec.gov. In
addition, the Trust 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 Trust's voting record is available (i) without charge, upon
request, by calling the Trust 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 Trust 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
Trusts 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.
8 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
TRUSTEES AND OFFICERS Unaudited
NAME, POSITION(S) PRINCIPAL OCCUPATION(S) DURING THE PAST 5 YEARS;
HELD WITH THE TRUST, OTHER TRUSTEESHIPS/DIRECTORSHIPS HELD; NUMBER OF
LENGTH OF SERVICE, AGE PORTFOLIOS IN THE TRUST COMPLEX CURRENTLY OVERSEEN
- ---------------------- --------------------------------------------------
INDEPENDENT TRUSTEES THE ADDRESS OF EACH TRUSTEE IN THE CHART BELOW IS
6803 S. TUCSON WAY, CENTENNIAL, COLORADO
80112-3924. EACH TRUSTEE SERVES FOR AN INDEFINITE
TERM, OR UNTIL HIS OR HER RESIGNATION, RETIREMENT,
DEATH OR REMOVAL.
WILLIAM L. ARMSTRONG, President, Colorado Christian University (since
Chairman of the Board of 2006); Chairman, Cherry Creek Mortgage Company
Trustees (since 2003), (since 1991), Chairman, Centennial State Mortgage
Trustee (since 2000) Company (since 1994), Chairman, The El Paso
Age: 71 Mortgage Company (since 1993); Chairman,
Ambassador Media Corporation (since 1984);
Chairman, Broadway Ventures (since 1984); Director
of Helmerich & Payne, Inc. (oil and gas
drilling/production company) (since 1992), Campus
Crusade for Christ (non-profit) (since 1991);
Former Director, The Lynde and Harry Bradley
Foundation, Inc. (non-profit organization)
(2002-2006); former Chairman of: Transland
Financial Services, Inc. (private mortgage banking
company) (1997-2003), Great Frontier Insurance
(1995-2000), Frontier Real Estate, Inc.
(residential real estate brokerage) (1994-2000)
and Frontier Title (title insurance agency)
(1995-2000); former Director of the following:
UNUMProvident (insurance company) (1991-2004),
Storage Technology Corporation (computer equipment
company) (1991-2003) and International Family
Entertainment (television channel) (1992-1997);
U.S. Senator (January 1979-January 1991). Oversees
39 portfolios in the OppenheimerFunds complex.
GEORGE C. BOWEN, Assistant Secretary and Director of the Manager
Trustee (since 1998) (December 1991-April 1999); President, Treasurer
Age: 71 and Director of Centennial Capital Corporation
(June 1989-April 1999); Chief Executive Officer
and Director of MultiSource Services, Inc. (March
1996-April 1999); Mr. Bowen held several positions
with OppenheimerFunds, Inc. and with subsidiary or
affiliated companies of OppenheimerFunds, Inc.
(September 1987-April 1999). Oversees 39
portfolios in the OppenheimerFunds complex.
EDWARD L. CAMERON, Member of The Life Guard of Mount Vernon (George
Trustee (since 2000) Washington historical site) (June 2000 - June
Age: 69 2006); Partner of PricewaterhouseCoopers LLP
(accounting firm) (July 1974-June 1999);
Chairman of Price Waterhouse LLP Global Investment
Management Industry Services Group (financial
services firm) (July 1994-June 1998). Oversees 39
portfolios in the OppenheimerFunds complex.
JON S. FOSSEL, Director of UNUMProvident (insurance company)
Trustee (since 1990) (since June 2002); Director of Northwestern Energy
Age: 66 Corp. (public utility corporation) (since November
2004); Director of P.R. Pharmaceuticals (October
1999-October 2003); Director of Rocky Mountain Elk
Foundation (non-profit organization) (February
1998-February 2003 and February 2005-February
2007); Chairman and Director (until October 1996)
and President and Chief Executive Officer (until
October 1995) of OppenheimerFunds, Inc.;
President, Chief Executive Officer and Director of
the following: Oppenheimer Acquisition Corp.
("OAC") (parent holding company of
OppenheimerFunds, Inc.), Shareholders Services,
Inc. and Shareholder Financial Services, Inc.
(until October 1995). Oversees 39 portfolios in
the OppenheimerFunds complex.
SAM FREEDMAN, Director of Colorado UpLIFT (charitable
Trustee (since 1996) organization) (since September 1984). Mr. Freedman
Age: 67 held several positions with OppenheimerFunds, Inc.
and with subsidiary or affiliated companies of
OppenheimerFunds, Inc. (until October 1994).
Oversees 39 portfolios in the OppenheimerFunds
complex.
9 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
TRUSTEES AND OFFICERS Unaudited/Continued
RICHARD F. GRABISH, Formerly Senior Vice President and Assistant
Trustee (since 2001) Director of Sales and Marketing (March
Age: 59 1997-December 2007), Director (March 1987-December
2007) and Manager of Private Client Services (June
1985-June 2005) of A.G. Edwards & Sons, Inc.
(broker/dealer and investment firm); Chairman and
Chief Executive Officer of A.G. Edwards Trust
Company, FSB (March 2001-December 2007); President
and Vice Chairman of A.G. Edwards Trust Company,
FSB (investment adviser) (April 1987-March 2001);
President of A.G. Edwards Trust Company, FSB
(investment adviser) (June 2005-December 2007).
Oversees 17 portfolios in the OppenheimerFunds
complex.
BEVERLY L. HAMILTON, Trustee of Monterey Institute for International
Trustee (since 2002) Studies (educational organization) (since February
Age: 61 2000); Board Member of Middlebury College
(educational organization) (since December
2005); Director of The California Endowment
(philanthropic organization) (since April 2002);
Director (February 2002-2005) and Chairman of
Trustees (2006-2007) of the Community Hospital of
Monterey Peninsula; Director (October 1991-2005)
and Vice Chairman (since 2006) of American Funds'
Emerging Markets Growth Fund, Inc. (mutual fund);
President of ARCO Investment Management Company
(February 1991-April 2000); Member of the
investment committees of The Rockefeller
Foundation (2001-2006) and The University of
Michigan (since 2000); Advisor at Credit Suisse
First Boston's Sprout venture capital unit
(venture capital fund) (1994-January 2005);
Trustee of MassMutual Institutional Funds
(investment company) (1996-June 2004); Trustee of
MML Series Investment Fund (investment company)
(April 1989-June 2004); Member of the investment
committee of Hartford Hospital (2000-2003); and
Advisor to Unilever (Holland) pension fund
(2000-2003). Oversees 39 portfolios in the
OppenheimerFunds complex.
ROBERT J. MALONE, Board of Directors of Opera Colorado Foundation
Trustee (since 2002) (non-profit organization) (since March 2008);
Age: 63 Director of Jones Knowledge, Inc. (since 2006);
Director of Jones International University
(educational organization) (since August 2005);
Chairman, Chief Executive Officer and Director of
Steele Street Bank & Trust (commercial banking)
(since August 2003); Director of Colorado UpLIFT
(charitable organization) (since 1986); Trustee
of the Gallagher Family Foundation (non-profit
organization) (since 2000); Former Chairman of
U.S. Bank-Colorado (subsidiary of U.S. Bancorp and
formerly Colorado National Bank) (July 1996-April
1999); Director of Commercial Assets, Inc. (real
estate investment trust) (1993-2000); Director of
Jones Knowledge, Inc. (2001-July 2004); and
Director of U.S. Exploration, Inc. (oil and gas
exploration) (1997-February 2004). Oversees 39
portfolios in the OppenheimerFunds complex.
F. WILLIAM MARSHALL, JR., Trustee of MassMutual Select Funds (formerly
Trustee (since 2000) MassMutual Institutional Funds) (investment
Age: 66 company) (since 1996) and MML Series Investment
Fund (investment company) (since 1996); Trustee
of Worcester Polytech Institute (since 1985);
Chairman (since 1994) of the Investment Committee
of the Worcester Polytech Institute (private
university); President and Treasurer of the SIS
Funds (private charitable fund) (since January
1999); Chairman of SIS & Family Bank, F.S.B.
(formerly SIS Bank) (commercial bank) (January
1999-July 1999); and Executive Vice President of
Peoples Heritage Financial Group, Inc. (commercial
bank) (January 1999-July 1999). Oversees 41
portfolios in the OppenheimerFunds complex.
10 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
INTERESTED TRUSTEE AND THE ADDRESS OF MR. MURPHY IS TWO WORLD FINANCIAL
OFFICER CENTER, 225 LIBERTY STREET, 11TH FLOOR, NEW YORK,
NEW YORK 10281-1008. MR. MURPHY SERVES AS A
TRUSTEE FOR AN INDEFINITE TERM, OR UNTIL HIS
RESIGNATION, RETIREMENT, DEATH OR REMOVAL AND AS
AN OFFICER FOR AN INDEFINITE TERM, OR UNTIL HIS
RESIGNATION, RETIREMENT, DEATH OR REMOVAL. MR.
MURPHY IS AN INTERESTED TRUSTEE DUE TO HIS
POSITIONS WITH OPPENHEIMERFUNDS, INC. AND ITS
AFFILIATES.
JOHN V. MURPHY, Chairman, Chief Executive Officer and Director of
Trustee, President and OppenheimerFunds, Inc. (since June 2001);
Principal Executive Officer President of OppenheimerFunds, Inc. (September
(since 2001) 2000-February 2007); President and director or
Age: 59 trustee of other Oppenheimer funds; President and
Director of Oppenheimer Acquisition Corp. ("OAC")
(the Manager's parent holding company) and of
Oppenheimer Partnership Holdings, Inc. (holding
company subsidiary of OppenheimerFunds, Inc.)
(since July 2001); Director of OppenheimerFunds
Distributor, Inc. (subsidiary of OppenheimerFunds,
Inc.) November 2001-December 2006); Chairman and
Director of Shareholder Services, Inc. and of
Shareholder Financial Services, Inc. (transfer
agent subsidiaries of OppenheimerFunds, Inc.)
(since July 2001); President and Director of
OppenheimerFunds Legacy Program (charitable trust
program established by OppenheimerFunds, Inc.)
(since July 2001); Director of the following
investment advisory subsidiaries of
OppenheimerFunds, Inc.: the Manager, OFI
Institutional Asset Management, Inc., Trinity
Investment Management Corporation and Tremont
Capital Management, Inc. (since November 2001),
HarbourView Asset Management Corporation and OFI
Private Investments, Inc. (since July 2001);
President (since November 2001) and Director
(since July 2001) of Oppenheimer Real Asset
Management, Inc.; Executive Vice President of
Massachusetts Mutual Life Insurance Company (OAC's
parent company) (since February 1997); Director of
DLB Acquisition Corporation (holding company
parent of Babson Capital Management LLC) (since
June 1995); Chairman (since October 2007) and
Member of the Investment Company Institute's Board
of Governors (since October 2003). Oversees 103
portfolios in the OppenheimerFunds complex.
OTHER OFFICERS OF THE TRUST THE ADDRESSES OF THE OFFICERS IN THE CHART BELOW
ARE AS FOLLOWS: FOR MR. ZACK AND MS. BLOOMBERG,
TWO WORLD FINANCIAL CENTER, 225 LIBERTY STREET,
NEW YORK, NEW YORK 10281-1008, FOR MESSRS.
VANDEHEY, WIXTED, PETERSEN, SZILAGYI AND MSS. WOLF
AND IVES, 6803 S. TUCSON WAY, CENTENNIAL, COLORADO
80112-3924. EACH OFFICER SERVES FOR AN INDEFINITE
TERM OR UNTIL HIS OR HER RESIGNATION, RETIREMENT,
DEATH OR REMOVAL.
CAROL WOLF, Senior Vice President of OppenheimerFunds, Inc.
Vice President and Portfolio (since June 2000) and of HarbourView Asset
Manager (since 2008) Management Corporation (since June 2003). A
Age: 56 portfolio manager and officer of 9 portfolios in
the OppenheimerFunds complex.
MARK S. VANDEHEY, Senior Vice President and Chief Compliance Officer
Vice President and Chief of OppenheimerFunds, Inc. (since March 2004);
Compliance Officer Chief Compliance Officer of OppenheimerFunds
(since 2004) Distributor, Inc., and Shareholder Services, Inc.
Age: 57 (since March 2004); Vice President of the Manager,
OppenheimerFunds Distributor, Inc., and
Shareholder Services, Inc. (since June 1983);
Former Vice President and Director of Internal
Audit of OppenheimerFunds, Inc. (1997-February
2004). An officer of 103 portfolios in the
Oppenheimer funds complex.
BRIAN W. WIXTED, Senior Vice President and Treasurer of
Treasurer and Principal OppenheimerFunds, Inc. (since March 1999);
Financial & Accounting Treasurer of the following: Shareholder Services,
Officer (since 1999) Inc., HarbourView Asset Management Corporation,
Age: 48 Shareholder Financial Services, Inc., Oppenheimer
Real Asset Management, Inc. and Oppenheimer
Partnership Holdings, Inc. (since March 1999), OFI
Private Investments, Inc. (since March 2000),
OppenheimerFunds
11 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
TRUSTEES AND OFFICERS Unaudited/Continued
BRIAN W. WIXTED, International Ltd. and OppenheimerFunds plc (since
Continued May 2000), OFI Institutional Asset Management,
Inc. (since November 2000), and OppenheimerFunds
Legacy Program (charitable trust program
established by the Manager) (since June 2003);
Treasurer and Chief Financial Officer of OFI Trust
Company (trust company subsidiary of
OppenheimerFunds, Inc.) (since May 2000);
Assistant Treasurer of OAC (since March 1999); and
Assistant Treasurer of the Manager and Distributor
(March 1999-October 2003) and OppenheimerFunds
Legacy Program (April 2000-June 2003). An officer
of 103 portfolios in the OppenheimerFunds complex.
BRIAN S. PETERSEN, Vice President of OppenheimerFunds, Inc. (since
Assistant Treasurer February 2007); Assistant Vice President (August
(since 2004) 2002-February 2007); Manager/Financial Product
Age: 37 Accounting of OppenheimerFunds, Inc. (November
1998-July 2002). An officer of 103 portfolios in
the OppenheimerFunds complex.
BRIAN C. SZILAGYI, Assistant Vice President of OppenheimerFunds, Inc.
Assistant Treasurer (since July 2004); Director of Financial Reporting
(since 2005) and Compliance of First Data Corporation (April
Age: 38 2003-July 2004); Manager of Compliance of Berger
Financial Group LLC (May 2001-March 2003). An
officer of 103 portfolios in the OppenheimerFunds
complex.
ROBERT G. ZACK, Executive Vice President (since January 2004) and
Vice President and Secretary General Counsel (since March 2002) of
(since 2001) OppenheimerFunds, Inc.; General Counsel of the
Age: 60 Manager and Distributor (since December 2001);
General Counsel and Director of OppenheimerFunds
Distributor, Inc. (since December 2001); Senior
Vice President, General Counsel and Director of
the Transfer Agent, Shareholder Financial
Services, Inc., OFI Private Investments, Inc. and
OFI Trust Company (since November 2001); Senior
Vice President and General Counsel of HarbourView
Asset Management Corporation (since December
2001); Secretary and General Counsel of OAC (since
November 2001); Assistant Secretary (since
September 1997) and Director (since November 2001)
of OppenheimerFunds International Ltd. and
OppenheimerFunds plc; Vice President and Director
of Oppenheimer Partnership Holdings, Inc. (since
December 2002); Director of Oppenheimer Real Asset
Management, Inc. (since November 2001); Vice
President of OppenheimerFunds Legacy Program
(since June 2003); Senior Vice President and
General Counsel of OFI Institutional Asset
Management, Inc. (since November 2001); Director
of OppenheimerFunds (Asia) Limited (since December
2003); Senior Vice President (May 1985-December
2003). An officer of 103 portfolios in the
OppenheimerFunds complex.
LISA I. BLOOMBERG, Vice President (since May 2004) and Deputy General
Assistant Secretary Counsel (since May 2008) of OppenheimerFunds,
(since 2004) Inc.; Associate Counsel (May 2004-May 2008) of
Age: 40 OppenheimerFunds Inc.; First Vice President (April
2001-April 2004), Associate General Counsel
(December 2000-April 2004) of UBS Financial
Services, Inc. An officer of 103 portfolios in the
OppenheimerFunds complex.
KATHLEEN T. IVES, Vice President (since June 1998), Deputy General
Assistant Secretary Counsel (since May 2008) and Assistant Secretary
(since 2001) (since October 2003); Senior Counsel (October
Age: 42 2003-May 2008) of OppenheimerFunds, Inc.; Vice
President (since 1999) and Assistant Secretary
(since October 2003) of the Distributor; Assistant
Secretary of the Manager (since October 2003);
Vice President and Assistant Secretary of
Shareholder Services, Inc. (since 1999); Assistant
Secretary of OppenheimerFunds Legacy Program and
Shareholder Financial Services, Inc. (since
December 2001); Senior General Counsel of
OppenheimerFunds, Inc. (October 2003-May 2008). An
officer of 103 portfolios in the OppenheimerFunds
complex.
THE TRUST'S STATEMENT OF ADDITIONAL INFORMATION CONTAINS ADDITIONAL INFORMATION
ABOUT THE TRUST'S TRUSTEES AND OFFICERS AND IS AVAILABLE WITHOUT CHARGE UPON
REQUEST.
12 | CENTENNIAL CALIFORNIA TAX EXEMPT TRUST
ITEM 2. CODE OF ETHICS.
The registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller or persons performing similar functions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The Board of Trustees of the registrant has determined that George C. Bowen,
the Chairman of the Board's Audit Committee, and Edward L. Cameron, a member of
the Board's Audit Committee, are audit committee financial experts and that
Messrs. Cameron and Bowen are "independent" for purposes of this Item 3.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees
The principal accountant for the audit of the registrant's annual financial
statements billed $18,500 in fiscal 2008 and $18,000 in fiscal 2007.
(b) Audit-Related Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
(c) Tax Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees to the registrant during the last two fiscal
years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees to the registrant during the last two fiscal
years to the registrant's investment adviser or any entity controlling,
controlled by, or under common control with the adviser that provides ongoing
services to the registrant.
(d) All Other Fees
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees during the last two fiscal years.
The principal accountant for the audit of the registrant's annual financial
statements billed no such fees in fiscal 2008 and $12,000 in fiscal 2007 to the
registrant's investment adviser or any entity controlling, controlled by, or
under common control with the adviser that provides ongoing services to the
registrant.
Such fees would include professional services for the 22c-2 program.
(e) (1) During its regularly scheduled periodic meetings, the registrant's
audit committee will pre-approve all audit, audit-related, tax and other
services to be provided by the principal accountants of the registrant.
The audit committee has delegated pre-approval authority to its Chairman
for any subsequent new engagements that arise between regularly scheduled
meeting dates provided that any fees such pre-approved are presented to the
audit committee at its next regularly scheduled meeting.
Under applicable laws, pre-approval of non-audit services maybe waived
provided that: 1) the aggregate amount of all such services provided
constitutes no more than five percent of the total amount of fees paid by
the registrant to it principal accountant during the fiscal year in which
services are provided 2) such services were not recognized by the
registrant at the time of engagement as non-audit services and 3) such
services are promptly brought to the attention of the audit committee of
the registrant and approved prior to the completion of the audit.
(2) 100%
(f) Not applicable as less than 50%.
(g) The principal accountant for the audit of the registrant's annual financial
statements billed no such fees in fiscal 2008 and $12,000 in fiscal 2007 to
the registrant and the registrant's investment adviser or any entity
controlling, controlled by, or under common control with the adviser that
provides ongoing services to the registrant related to non-audit fees.
Those billings did not include any prohibited non-audit services as defined
by the Securities Exchange Act of 1934.
(h) The registrant's audit committee of the board of trustees has considered
whether the provision of non-audit services that were rendered to the
registrant's investment adviser, and any entity controlling, controlled by,
or under common control with the investment adviser that provides ongoing
services to the registrant that were not pre-approved pursuant to paragraph
(c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining
the principal accountant's independence. No such services were rendered.
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.
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:
- the name, address, and business, educational, and/or other pertinent
background of the person being recommended;
- a statement concerning whether the person is an "interested person" as
defined in the Investment Company Act of 1940;
- 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
- 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 06/30/2008, 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) Exhibit attached hereto.
(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.
Centennial California Tax Exempt Trust
By: /s/ John V. Murphy
---------------------------
John V. Murphy
Principal Executive Officer
Date: 08/07/2008
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
---------------------------
Principal Executive Officer
Date: 08/07/2008
By: /s/ Brian W. Wixted
---------------------------
Brian W. Wixted
Principal Financial Officer
Date: 08/07/2008