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 811-21888
Oppenheimer Institutional Money Market Fund
(Exact name of registrant as specified in charter)
6803 South Tucson Way, Centennial, Colorado 80112-3924
(Address of principal executive offices) (Zip code)
Robert G. Zack, Esq.
OppenheimerFunds, Inc.
Two World Financial Center, New York, New York 10281-1008
(Name and address of agent for service)
Registrant's telephone number, including area code: (303) 768-3200
Date of fiscal year end: May 31
Date of reporting period: 11/30/2008
ITEM 1. REPORTS TO STOCKHOLDERS.
NOVEMBER 30, 2008
Oppenheimer Institutional Money Market Fund
Management Commentaries and Semiannual Report
MANAGEMENT COMMENTARIES
An Interview with Your Fund's Manager
SEMIANNUAL REPORT
Listing of Investments
Financial Statements
(OPPENHEIMERFUNDS(R) LOGO)
The Right Way to Invest
NOTES
AN INVESTMENT IN THE FUND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY. ALTHOUGH THE FUND SEEKS TO
PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT IS POSSIBLE TO LOSE
MONEY BY INVESTING IN THE FUND.
THE FUND'S INVESTMENT STRATEGY, ALLOCATIONS, AND FOCUS CAN CHANGE OVER TIME. THE
MENTION OF SPECIFIC FUND HOLDINGS DOES NOT CONSTITUTE A RECOMMENDATION BY
OPPENHEIMERFUNDS, INC.
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, OR CALLING US AT 1.800.645.2028. READ THE PROSPECTUS
CAREFULLY BEFORE INVESTING.
10 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
FUND EXPENSES
FUND EXPENSES. As a shareholder of the Fund, you incur 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 November 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 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 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 Fund's actual expense ratio for each class of shares, and an
assumed rate of return of 5% per year for each class 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 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), 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.
11 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
FUND EXPENSES Continued
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT PAID DURING
VALUE VALUE 6 MONTHS ENDED
ACTUAL JUNE 1, 2008 NOVEMBER 30, 2008 NOVEMBER 30, 2008
- ------ ------------ ----------------- -----------------
Class E $1,000.00 $1,014.00 $0.61
Class L 1,000.00 1,014.00 0.61
Class P 1,000.00 1,013.80 0.86
HYPOTHETICAL
(5% return before expenses)
Class E 1,000.00 1,024.47 0.61
Class L 1,000.00 1,024.47 0.61
Class P 1,000.00 1,024.22 0.86
Expenses are equal to the Fund's annualized expense ratio for that class,
multiplied by the average account value over the period, multiplied by 183/365
(to reflect the one-half year period). Those annualized expense ratios based on
the 6-month period ended November 30, 2008 are as follows:
CLASS EXPENSE RATIOS
- ----- --------------
Class E 0.12%
Class L 0.12
Class P 0.17
The expense ratios reflect reduction to custodian expenses and voluntary waivers
or reimbursements of expenses by the Fund's Transfer Agent and Distributor 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.
12 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
STATEMENT OF INVESTMENTS November 30, 2008 / Unaudited
PRINCIPAL
AMOUNT VALUE
------------ --------------
CERTIFICATES OF DEPOSIT--21.5%
YANKEE CERTIFICATES OF DEPOSIT--21.5%
Abbey National Treasury Services plc, Stamford, CT:
3.06%, 12/12/08 $ 18,500,000 $ 18,500,000
3.06%, 12/12/08 15,000,000 15,000,000
Bank of Nova Scotia, Houston, TX:
3.06%, 9/2/09(1) 50,000,000 50,000,000
3.063%, 9/4/09(1) 50,000,000 50,000,000
3.064%, 9/8/09(1) 50,000,000 50,000,000
3.114%, 9/8/09(1) 100,000,000 100,000,000
3.20%, 12/18/08 50,000,000 50,000,000
Barclays Bank plc, New York:
1.45%, 12/22/08 100,000,000 100,000,000
1.60%, 12/17/08 100,000,000 100,000,000
1.60%, 12/18/08 50,000,000 50,000,000
BNP Paribas, New York:
1.97%, 2/12/09 50,000,000 50,000,000
2.16%, 2/4/09 50,000,000 50,000,000
2.29%, 2/10/09 36,000,000 36,017,634
3.10%, 2/27/09 25,000,000 25,000,000
3.12%, 12/16/08 50,000,000 50,000,000
DnB NOR Bank ASA, New York, 3.07%, 12/8/08 30,000,000 30,000,000
Lloyds TSB Bank plc:
1.90%, 2/17/09 40,000,000 39,991,331
2.01%, 2/13/09 50,000,000 50,000,000
3%, 12/4/08 100,000,000 100,000,000
3.50%, 1/23/09 50,000,000 50,043,705
Nordea Bank Finland plc, New York, 1.25%, 12/11/08 150,000,000 150,000,000
Royal Bank of Canada, New York, 2.706%, 8/7/09(1) 50,000,000 50,000,000
Societe Generale, 4%, 1/20/09 100,000,000 100,000,000
PRINCIPAL
AMOUNT VALUE
------------ --------------
YANKEE CERTIFICATES OF DEPOSIT Continued
Toronto Dominion Bank, New York:
3.03%, 2/5/09 $ 20,000,000 $ 20,000,000
3.13%, 1/30/09 100,000,000 100,000,000
--------------
Total Certificates of Deposit (Cost $1,484,552,670) 1,484,552,670
DIRECT BANK OBLIGATIONS--17.3%
Capital One Funding Corp., Series 1996E, 2.05%,
12/1/08(1) 5,942,000 5,942,000
Danske Corp.:
1%, 12/1/08(2) 250,000,000 250,000,000
1.39%, 12/29/08(2) 50,000,000 49,945,944
DnB NOR Bank ASA, 2.995%, 2/9/09 50,000,000 49,708,819
Governor & Co. of the Bank of Ireland:
1.70%, 12/9/08(2) 45,000,000 44,983,000
2.08%, 12/2/08(2) 38,600,000 38,597,770
HSBC USA, Inc.:
2.81%, 12/2/08 50,000,000 49,996,097
2.824%, 12/5/08 75,000,000 74,976,467
3.06%, 12/19/08 45,000,000 44,931,150
3.09%, 12/12/08 100,000,000 99,905,583
National Australia Funding (Delaware), Inc.:
1.40%, 1/29/09(2) 50,000,000 49,885,278
2.735%, 12/26/08(2) 70,000,000 69,867,049
2.75%, 12/15/08(2) 25,000,000 24,973,264
PNC Bank NA, Nassau, 0.313%, 12/1/08 115,000,000 115,000,000
Royal Bank of Canada, 4.953%, 7/15/09(1) 50,000,000 50,000,000
Santander Central Hispano Finance (Delaware), Inc.,
3.12%, 12/30/08 15,000,000 14,962,300
F1 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
STATEMENT OF INVESTMENTS Unaudited / Continued
PRINCIPAL
AMOUNT VALUE
------------ --------------
DIRECT BANK OBLIGATIONS Continued
Wells Fargo Bank NA, 0.25%, 12/1/08 $165,000,000 $ 165,000,000
--------------
Total Direct Bank Obligations (Cost $1,198,674,721) 1,198,674,721
SHORT-TERM NOTES--56.2%
CAPITAL MARKETS--2.9%
BNP Paribas Finance, Inc., 2.20%, 2/9/09 50,000,000 49,786,111
Citigroup Funding, Inc.:
1.48%, 12/16/08 50,000,000 49,969,167
2.82%, 12/10/08 100,000,000 99,929,500
--------------
199,684,778
COMMERCIAL BANKS--5.2%
Bank of America Corp., 0.30%, 12/1/08 190,000,000 190,000,000
JPMorgan Chase Bank, NA, 0.50%, 12/1/08 170,000,000 170,000,000
--------------
360,000,000
DIVERSIFIED FINANCIAL SERVICES--7.1%
General Electric Capital Corp.:
1.90%, 2/6/09 16,000,000 15,943,422
3%, 1/27/09 100,000,000 99,525,000
3.10%, 1/23/09 100,000,000 99,543,611
General Electric Capital Services, 1%, 12/2/08 100,000,000 99,997,222
Prudential Funding LLC:
1.35%, 12/15/08(3) 25,000,000 24,986,875
2.50%, 12/3/08(3) 50,000,000 49,993,056
3.05%, 12/1/08(3) 100,000,000 100,000,000
--------------
489,989,186
PRINCIPAL
AMOUNT VALUE
------------ --------------
INSURANCE--2.2%
Jackson National Life Global Funding, Series
2008-1, 2.59%, 2/10/09(1, 4) $ 50,000,000 $ 50,000,000
Security Life of Denver, 2.018%, 9/8/09(1,3) 100,000,000 100,000,000
--------------
150,000,000
IT SERVICES--0.3%
IBM International Group Capital, 2.225%, 2/13/09(1) 20,000,000 19,988,732
LEASING & FACTORING--7.0%
American Honda Finance Corp.:
2.319%, 8/26/09(1, 4) 50,000,000 50,000,000
2.989%, 5/5/09(1, 4) 50,000,000 50,000,000
3.026%, 9/18/09(1, 4) 50,000,000 50,000,000
4.419%, 7/8/09(1, 4) 50,000,000 50,000,000
Toyota Motor Credit Corp.:
2.10%, 2/11/09 40,000,000 39,832,000
2.15%, 2/9/09 50,000,000 49,722,917
2.50%, 2/2/09 94,100,000 93,589,508
2.65%, 1/26/09 100,000,000 99,587,778
--------------
482,732,203
MUNICIPAL--0.6%
Bloomingdale Life Time Fitness LLC Revenue Bonds,
Series 2000, 2.25%, 12/1/08(1) 7,050,000 7,050,000
Las Vegas, NV Economic Development Revenue Bonds,
Keep Memory Alive Project, Series 2007B,
2.431%, 12/1/08(1) 5,400,000 5,400,000
F2 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
PRINCIPAL
AMOUNT VALUE
------------ --------------
MUNICIPAL Continued
Liberty Cnty., GA Industrial Improvement Revenue
Bonds, Hugo Boss USA, Inc. Project, Series 2002,
3.50%, 12/1/08(1) $ 3,900,000 $ 3,900,000
OK University Hospitals Trust Revenue Bonds,
Series B, 1.80%, 12/1/08(1) 2,800,000 2,800,000
Private Colleges & Universities Authority Revenue
Bonds, Mercer University Project, Series 2006B,
3.43%, 12/1/08(1) 7,305,000 7,305,000
Roanoke, NC Music & Entertainment District Special
Revenue Bonds, Series 2007, 1.80%, 12/1/08(1) 9,800,000 9,800,000
Warren Cnty., KY Industrial Building Revenue Bonds,
Series B2, 1.80%, 12/1/08(1) 7,300,000 7,300,000
--------------
43,555,000
OIL, GAS & CONSUMABLE FUELS--4.3%
Total Capital, 0.70%, 12/1/08(2) 300,000,000 300,000,000
PERSONAL PRODUCTS--1.4%
Reckitt Benckiser Treasury Services plc:
2.19%, 2/17/09(2) 50,000,000 49,762,750
2.27%, 2/13/09(2) 50,000,000 49,766,694
--------------
99,529,444
PRINCIPAL
AMOUNT VALUE
------------ --------------
PHARMACEUTICALS--0.5%
Novartis Finance Corp., 0.73%, 12/1/08(2) $ 35,000,000 $ 35,000,000
RECEIVABLES FINANCE--19.9%
Amsterdam Funding Corp.:
3.08%, 3/5/09(2) 50,000,000 49,597,889
3.10%, 1/6/09(2) 76,700,000 76,462,230
4.25%, 1/8/09(2) 88,400,000 88,003,428
Chariot Funding LLC:
0.60%, 12/1/08(4) 80,000,000 80,000,000
1.40%, 1/8/09(4) 41,178,000 41,054,123
1.40%, 1/21/09(4) 20,000,000 19,960,333
2.85%, 1/27/09 51,000,000 50,769,863
Falcon Asset Securitization Co. LLC, 2.85%,
1/22/09(2) 175,000,000 174,279,583
Gemini Securitization Corp.:
2.95%, 1/29/09(2) 50,000,000 49,758,264
3%, 1/21/09(2) 14,116,000 14,056,007
3.25%, 12/23/08(2) 50,000,000 49,900,694
3.25%, 1/26/09(2) 46,000,000 45,767,444
3.25%, 1/28/09(2) 50,000,000 49,738,194
3.85%, 1/23/09(2) 50,000,000 49,716,597
4.20%, 12/1/08(2) 50,000,000 50,000,000
4.35%, 1/16/09(2) 50,000,000 49,722,083
Legacy Capital LLC:
2.70%, 1/12/09 50,000,000 49,842,500
2.70%, 1/23/09 50,000,000 49,801,250
Thunder Bay Funding LLC:
1.45%, 1/20/09(4) 65,166,000 65,034,763
3%, 1/28/09(4) 128,059,000 127,440,048
Windmill Funding Corp.:
3.085%, 3/6/09(2) 25,000,000 24,796,476
3.10%, 1/7/09(2) 123,000,000 122,608,108
--------------
1,378,309,877
SPECIAL PURPOSE FINANCIAL--4.8%
FCAR Owner Trust I:
2.35%, 12/1/08 15,400,000 15,400,000
2.85%, 12/15/08 75,000,000 74,916,875
F3 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
STATEMENT OF INVESTMENTS Unaudited / Continued
PRINCIPAL
AMOUNT VALUE
------------ --------------
SPECIAL PURPOSE FINANCIAL Continued
FCAR Owner Trust I: Continued
2.85%, 12/17/08 $ 75,000,000 $ 74,905,000
2.85%, 12/19/08 50,000,000 49,928,750
Ticonderoga Funding LLC:
1%, 12/1/08 67,006,000 67,006,000
1.15%, 12/5/08 50,000,000 49,993,611
--------------
332,150,236
--------------
Total Short-Term Notes
(Cost $3,890,939,456) 3,890,939,456
U.S. GOVERNMENT AGENCIES--1.1%
Federal Home Loan Bank:
2.43%, 4/22/09 25,000,000 24,760,375
2.75%, 4/27/09 50,000,000 49,438,542
--------------
Total U.S. Government Agencies
(Cost $74,198,917) 74,198,917
SHARES VALUE
------------ --------------
INVESTMENT COMPANY--4.0%
Dreyfus Government Cash Management--Institutional
(Cost $278,500,000) 278,500,000 $ 278,500,000
TOTAL INVESTMENTS, AT VALUE
(COST $6,926,865,764) 100.1% 6,926,865,764
LIABILITIES IN EXCESS OF OTHER ASSETS (0.1) (3,555,095)
------------ --------------
NET ASSETS 100.0% $6,923,310,669
============ ==============
FOOTNOTES TO STATEMENT OF INVESTMENTS
SHORT-TERM NOTES AND DIRECT BANK OBLIGATIONS ARE GENERALLY TRADED ON A DISCOUNT
BASIS; THE INTEREST RATE SHOWN IS THE DISCOUNT RATE RECEIVED BY THE FUND AT THE
TIME OF PURCHASE. OTHER SECURITIES NORMALLY BEAR INTEREST AT THE RATES SHOWN.
(1.) Represents the current interest rate for a variable or increasing rate
security.
(2.) Security issued in an exempt transaction without registration under the
Securities Act of 1933. Such securities amount to $1,857,188,746, or 26.83%
of the Fund's net assets, and have been determined to be liquid pursuant to
guidelines adopted by the Board of Trustees.
(3.) Illiquid security. The aggregate value of illiquid securities as of
November 30, 2008 was $274,979,931, which represents 3.97% of the Fund's
net assets. See Note 4 of accompanying Notes.
(4.) 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 $583,489,267 or 8.43% of the Fund's
net assets as of November 30, 2008.
VALUATION INPUTS
Various data inputs are used in determining the value of each of the Fund's
investments as of the reporting period end. These data inputs are categorized in
the following hierarchy under applicable financial accounting standards:
1) Level 1--quoted prices in active markets for identical assets or
liabilities (including securities actively traded on a securities exchange)
2) Level 2--inputs other than quoted prices that are observable for the
asset (such as quoted prices for similar assets and market corroborated
inputs such as interest rates, prepayment speeds, credit risks, etc.)
3) Level 3--unobservable inputs (including the Manager's own judgments
about assumptions that market participants would use in pricing the asset).
F4 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
VALUATION INPUTS Continued
The market value of the Fund's investments was determined based on the following
inputs as of November 30, 2008:
INVESTMENTS IN OTHER FINANCIAL
VALUATION DESCRIPTION SECURITIES INSTRUMENTS*
- --------------------- -------------- ---------------
Level 1--Quoted Prices $ 278,500,000 $--
Level 2--Other Significant Observable Inputs 6,648,365,764 --
Level 3--Significant Unobservable Inputs -- --
-------------- ---
Total $6,926,865,764 $--
============== ===
* Other financial instruments include options written, currency contracts,
futures, forwards and swap contracts. Currency contracts and forwards are
reported at their unrealized appreciation/depreciation at measurement date,
which represents the change in the contract's value from trade date.
Futures are reported at their variation margin at measurement date, which
represents the amount due to/from the Fund at that date. Options and swaps
are reported at their market value at measurement date.
SEE THE ACCOMPANYING NOTES FOR FURTHER DISCUSSION OF THE METHODS USED IN
DETERMINING VALUE OF THE FUND'S INVESTMENTS, AND A SUMMARY OF CHANGES TO THE
VALUATION TECHNIQUES, IF ANY, DURING THE REPORTING PERIOD.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F5 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES Unaudited
November 30, 2008
ASSETS
Investments, at value (cost $6,926,865,764)--see accompanying statement of investments $6,926,865,764
Receivables and other assets:
Interest and dividends 9,399,414
Shares of beneficial interest sold 543,714
Other 343,358
--------------
Total assets 6,937,152,250
LIABILITIES
Bank overdraft 641,657
Payables and other liabilities:
Dividends 12,599,592
Trustees' compensation 355,114
Distribution and service plan fees 160,388
Transfer and shareholder servicing agent fees 6,203
Shareholder communications 4,964
Other 73,663
--------------
Total liabilities 13,841,581
NET ASSETS $6,923,310,669
==============
COMPOSITION OF NET ASSETS
Par value of shares of beneficial interest $ 6,922,917
Additional paid-in capital 6,915,993,672
Accumulated net investment income 10
Accumulated net realized gain on investments 394,070
--------------
NET ASSETS $6,923,310,669
==============
NET ASSET VALUE PER SHARE
Class E Shares:
Net asset value and redemption price per share (based on net assets of
$5,514,136,176 and 5,513,819,210 shares of beneficial interest
outstanding) $ 1.00
Class L Shares:
Net asset value and redemption price per share (based on net assets of
$1,195,627,148 and 1,195,561,507 shares of beneficial interest outstanding) $ 1.00
Class P Shares:
Net asset value and redemption price per share (based on net assets of
$213,547,345 and 213,535,872 shares of beneficial interest outstanding) $ 1.00
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F6 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
STATEMENT OF OPERATIONS Unaudited
For the Six Months Ended November 30, 2008
INVESTMENT INCOME
Interest $ 96,941,275
Dividends 2,863,075
--------------
Total investment income 99,804,350
EXPENSES
Management fees 3,441,364
Distribution and service plan fees--Class P 173,994
Transfer and shareholder servicing agent fees:
Class E 11,692
Class L 15,015
Class P 5,860
Shareholder communications:
Class E 1,260
Class L 13,230
Class P 13
Insurance expense 440,558
Trustees' compensation 108,094
Legal, auditing and other professional fees 37,855
Custodian fees and expenses 19,753
Other 8,374
--------------
Total expenses 4,277,062
Less reduction to custodian expenses (135)
Less waivers and reimbursements of expenses (140,881)
--------------
Net expenses 4,136,046
NET INVESTMENT INCOME 95,668,304
NET REALIZED GAIN ON INVESTMENTS 235,688
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 95,903,992
==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F7 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
STATEMENTS OF CHANGES IN NET ASSETS
SIX MONTHS YEAR
ENDED ENDED
NOVEMBER 30, 2008 MAY 31,
(UNAUDITED) 2008
----------------- --------------
OPERATIONS
Net investment income $ 95,668,304 $ 266,043,916
Net realized gain 235,688 244,737
-------------- --------------
Net increase in net assets resulting from operations 95,903,992 266,288,653
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS
Dividends from net investment income:
Class E (76,209,303) (248,672,603)
Class L (17,411,863) (17,445,181)
Class P (2,026,959) (20,034)
-------------- --------------
(95,648,125) (266,137,818)
BENEFICIAL INTEREST TRANSACTIONS
Net increase (decrease) in net assets resulting from beneficial
interest transactions:
Class E (183,142,228) 1,733,750,762
Class L 442,226,850 752,833,041
Class P 212,596,959 928,913
-------------- --------------
471,681,581 2,487,512,716
NET ASSETS
Total increase 471,937,448 2,487,663,551
Beginning of period 6,451,373,221 3,963,709,670
-------------- --------------
End of period (including accumulated net investment income
(loss) of $10 and $(20,169), respectively) $6,923,310,669 $6,451,373,221
============== ==============
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F8 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
FINANCIAL HIGHLIGHTS Unaudited
SIX MONTHS
ENDED
NOVEMBER 30, YEAR ENDED MAY 31,
2008 ------------------------
CLASS E (UNAUDITED) 2008 2007(1)
- ------- ------------ ----------- ----------
PER SHARE OPERATING DATA
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations--net investment
income and net realized gain(2) .01 .05 .03
Dividends and/or distributions to shareholders:
Dividends from net investment income (.01) (.05) (.03)
---------- ---------- ----------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
========== ========== ==========
TOTAL RETURN(3) 1.40% 4.69% 3.52%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $5,514,136 $5,697,092 $3,963,198
Average net assets (in thousands) $5,495,212 $5,462,546 $3,623,302
Ratios to average net assets:(4)
Net investment income 2.77% 4.55% 5.25%
Total expenses 0.12%(5) 0.11% 0.11%
(1.) For the period from October 3, 2006 (commencement of operations) to May 31,
2007.
(2.) Per share amounts calculated based on the average shares outstanding during
the period.
(3.) Assumes an initial 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 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%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F9 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
FINANCIAL HIGHLIGHTS Unaudited / Continued
SIX MONTHS
ENDED
NOVEMBER 30, YEAR ENDED MAY 31,
2008 ------------------
CLASS L (UNAUDITED) 2008 2007(1)
- ------- ------------ ------- --------
PER SHARE OPERATING DATA
Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations--net investment
income and net realized gain(2) .01 .05 .04
Dividends and/or distributions to shareholders:
Dividends from net investment income (.01) (.05) (.04)
---------- -------- ------
Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
========== ======== ======
TOTAL RETURN(3) 1.40% 4.69% 3.61%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $1,195,627 $753,342 $ 502
Average net assets (in thousands) $1,247,175 $443,323 $ 68
Ratios to average net assets:(4)
Net investment income 2.79% 3.93% 3.62%
Total expenses 0.12%(5) 0.12% 0.08%
(1.) For the period from October 3, 2006 (commencement of operations) to May 31,
2007.
(2.) Per share amounts calculated based on the average shares outstanding during
the period.
(3.) Assumes an initial 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 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%.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F10 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
SIX MONTHS
ENDED
NOVEMBER 30, YEAR ENDED MAY 31,
2008 ------------------
CLASS P (UNAUDITED) 2008 2007(1)
- ------- ------------ ------- --------
PER SHARE OPERATING DATA
Net asset value, beginning of period $ 1.00 $1.00 $1.00
Income from investment operations--net investment
income and net realized gain(2) .01 .05 --(3)
Dividends and/or distributions to shareholders:
Dividends from net investment income (.01) (.05) --(3)
-------- ----- -----
Net asset value, end of period $ 1.00 $1.00 $1.00
======== ===== =====
TOTAL RETURN(4) 1.38% 4.68% 0.15%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $213,548 $ 939 $ 10
Average net assets (in thousands) $143,021 $ 517 $ 10
Ratios to average net assets:(5)
Net investment income 2.83% 3.78% 4.79%
Total expenses 0.37% 2.14% 0.10%
Expenses after payments, waivers and/or reimbursements
and reduction to custodian expenses 0.17% 0.20% 0.10%
(1.) For the period from May 21, 2007 (inception of offering) to May 31, 2007.
(2.) Per share amounts calculated based on the average shares outstanding during
the period.
(3.) Less than $0.005 per share.
(4.) Assumes an initial 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 fund
distributions or the redemption of fund shares.
(5.) Annualized for periods less than one full year.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
F11 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS Unaudited
1. SIGNIFICANT ACCOUNTING POLICIES
Oppenheimer Institutional Money Market Fund (the "Fund") is registered under the
Investment Company Act of 1940, as amended, as an open-end management investment
company. The Fund's investment objective is to seek current income and stability
of principal. The Fund's investment adviser is OppenheimerFunds, Inc. (the
"Manager").
The Fund offers Class E, Class L and Class P shares. All classes of shares
are sold at net asset value per share without any initial sales charge. Class E
shares are only offered to other Oppenheimer Funds, the Manager and their
affiliates. Class L shares are offered directly to institutional investors.
Class P shares may only be sold through an investment professional. Brokers or
other investment professionals that offer Class P shares 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.
The following is a summary of significant accounting policies consistently
followed by the Fund.
SECURITIES VALUATION. 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 Fund's Board of Trustees.
Effective for fiscal periods beginning after November 15, 2007, FASB
Statement of Financial Accounting Standards No. 157, FAIR VALUE MEASUREMENTS,
establishes a hierarchy for measuring fair value of assets and liabilities. As
required by the standard, each investment asset or liability of the Fund is
assigned a level at measurement date based on the significance and source of the
inputs to its valuation. Quoted prices in active markets for identical
securities are classified as "Level 1", inputs other than quoted prices for an
asset that are observable are classified as "Level 2" and unobservable inputs,
including the Manager's judgment about the assumptions that a market participant
would use in pricing an asset or liability are classified as "Level 3". The
inputs used for valuing securities are not necessarily an indication of the
risks associated with investing in those securities. A table summarizing the
Fund's investments under these levels of classification is included following
the Statement of Investments.
"Money market-type" instruments are typically designated as Level 2.
In the absence of a readily available quoted market price, including for
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 the securities' respective exchanges, the Manager, acting
through its internal valuation committee, in good faith determines the fair
valuation of that asset using consistently applied procedures under the
supervision of the Board of Trustees (which reviews those fair valuations by the
Manager). Those procedures include certain standardized methodologies to fair
value securities. Such
F12 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
methodologies include, but are not limited to, pricing securities initially at
cost and subsequently adjusting the value based on: changes in company specific
fundamentals, changes in an appropriate securities index, or changes in the
value of similar securities which may be adjusted for any discounts related to
resale restrictions. When possible, such methodologies use observable market
inputs such as quoted prices of similar securities, observable interest rates,
currency rates and yield curves. The methodologies used for valuing securities
are not necessarily an indication of the risks associated with investing in
those securities.
Fair valued securities may be classified as "Level 3" if the valuation
primarily reflects the Manager's own assumptions about the inputs that market
participants would use in valuing such securities.
There have been no significant changes to the fair valuation methodologies
during the period.
ALLOCATION OF INCOME, EXPENSES, GAINS AND LOSSES. Income, expenses (other than
those attributable to a specific class), gains and losses are allocated on a
daily basis to each class of shares based upon the relative proportion of net
assets represented by such class. Operating expenses directly attributable to a
specific class are charged against the operations of that class.
FEDERAL TAXES. The Fund intends to comply with provisions of the Internal
Revenue Code applicable to regulated investment companies and to distribute
substantially all of its investment company taxable income, including any net
realized gain on investments not offset by capital loss carryforwards, if any,
to shareholders. Therefore, no federal income or excise tax provision is
required. The Fund files income tax returns in U.S. federal and applicable state
jurisdictions. The statute of limitations on the Fund's tax return filings
generally remain open for the three preceding fiscal reporting period ends.
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.
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 November 30, 2008,
the Fund's projected benefit obligations, payments to retired trustees and
accumulated liability were as follows:
Projected Benefit Obligations Increased $ 38,060
Payments Made to Retired Trustees 69
Accumulated Liability as of November 30, 2008 279,396
F13 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
1. SIGNIFICANT ACCOUNTING POLICIES Continued
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 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 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.
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.
F14 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
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 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 NOVEMBER 30, 2008 YEAR ENDED MAY 31, 2008
---------------------------------- ----------------------------------
SHARES AMOUNT SHARES AMOUNT
--------------- ---------------- --------------- ----------------
CLASS E
Sold 26,553,805,780 $ 26,553,805,780 52,370,394,439 $ 52,370,394,439
Dividends and/or
distributions reinvested 7,925,078 7,925,078 27,054,601 27,054,601
Redeemed (26,744,873,086) (26,744,873,086) (50,663,698,278) (50,663,698,278)
--------------- ---------------- --------------- ----------------
Net increase (decrease) (183,142,228) $ (183,142,228) 1,733,750,762 $ 1,733,750,762
=============== ================ =============== ================
CLASS L
Sold 8,449,062,124 $ 8,449,062,124 7,423,498,426 $ 7,423,498,426
Dividends and/or
distributions reinvested 16,344,088 16,344,088 15,204,958 15,204,958
Redeemed (8,023,179,362) (8,023,179,362) (6,685,870,343) (6,685,870,343)
--------------- ---------------- --------------- ----------------
Net increase 442,226,850 $ 442,226,850 752,833,041 $ 752,833,041
=============== ================ =============== ================
CLASS P
Sold 513,017,000 $ 513,017,000 1,635,907 $ 1,635,907
Dividends and/or
distributions reinvested 146,518 146,518 17,517 17,517
Redeemed (300,566,559) (300,566,559) (724,511) (724,511)
--------------- ---------------- --------------- ----------------
Net increase 212,596,959 $ 212,596,959 928,913 $ 928,913
=============== ================ =============== ================
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
MANAGEMENT FEES. Under the investment advisory agreement, the Fund pays the
Manager a management fee based on the daily net assets of the Fund at an annual
rate of 0.10%.
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 an annual fee of $10,000 for each class of shares.
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.
F15 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
NOTES TO FINANCIAL STATEMENTS Unaudited / Continued
3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES Continued
SERVICE PLAN FOR CLASS P SHARES. The Fund has adopted a Service Plan (the
"Plan") for Class P shares under Rule 12b-1 of the Investment Company Act of
1940. Under the Plan, the Fund reimburses the Distributor for a portion of its
costs incurred for services provided to accounts that hold Class P shares.
Reimbursement is made periodically at an annual rate of up to 0.25% of the
average annual net assets of Class P shares of the Fund. The Distributor
currently uses all of those fees to pay dealers, brokers, banks and other
financial institutions periodically for providing personal service and
maintenance of accounts of their customers that hold Class P shares. Any
unreimbursed expenses the Distributor incurs with respect to Class P 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.
WAIVERS AND REIMBURSEMENTS OF EXPENSES. The Manager has agreed to waive its
management fees and/or reimburse expenses such that "Expenses after waivers,
payments and/or reimbursements and reduction to custodian expenses" will not
exceed 0.15% for Class E and Class L shares and 0.20% for Class P shares. These
undertakings are voluntary and may be amended or 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.
Effective August 1, 2008, the Transfer Agent has voluntarily undertaken to limit
the Fund's annual transfer agent fees for all classes to 0.01% of average net
assets. During the six months ended November 30, 2008, OFS waived $3,757 for
Class P shares. This undertaking may be amended or withdrawn at any time.
Effective October 9, 2007, the Distributor has voluntarily undertaken to
waive the fees payable under the Service Plan for Class P shares so that those
fees are limited to 0.05% of the average net assets for Class P shares of the
Fund. During the six months ended November 30, 2008, the Distributor waived
$137,124 for Class P shares. That undertaking may be amended or withdrawn at any
time.
4. ILLIQUID SECURITIES
As of November 30, 2008, investments in securities included issues that are
illiquid. investments may be illiquid because they do not have an active trading
market, making it difficult to value them or dispose of them promptly at an
acceptable price. The Fund will not invest more than 10% of its net assets
(determined at the time of purchase and reviewed periodically) in illiquid
securities. Securities that are illiquid are marked with an applicable footnote
on the Statement of Investments.
5. TEMPORARY GUARANTEE PROGRAM FOR MONEY MARKET FUNDS
The Fund's Board of Trustees has elected for the Fund to participate in the
Temporary Guarantee Program for Money Market Funds (the "Program") established
by the U.S. Treasury Department. The Treasury Department has accepted the Fund's
application to participate in the Program and entered into a Guarantee Agreement
with the Fund dated
F16 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
as of September 19, 2008. The Fund has also notified the Treasury Department of
its intent to continue its participation in the Program through April 30, 2009.
Under the Program, shareholders of the Fund as of the close of business on
September 19, 2008 may be guaranteed against loss in the event that the Fund's
net asset value falls below $0.995. The Program applies only to shareholders of
record as of the close of business on September 19, 2008. The number of shares
covered by the Program will be the lesser of (a) the number of shares of the
Fund owned by the shareholder on September 19, 2008 or (b) the number of shares
owned by the shareholder on the date the Fund's net asset value falls below
$0.995. If the number of shares of the Fund a shareholder holds after September
19, 2008 fluctuates during the Program period due to purchases or redemptions of
shares, any shares in excess of the amount held as of the close of business on
September 19, 2008 will not be covered.
The Fund has paid a fee to participate in the Program's initial term in the
amount equal to 0.01% of the Fund's net assets as of the close of business on
September 19, 2008. The Fund has paid an additional fee to continue its
participation in the Program through April 30, 2009 in the amount of 0.015% of
the Fund's net assets as of the close of business on September 19, 2008. Fees
paid by the Fund to participate in the Program are shown as insurance expense on
the Statement of Operations. Participation in any further extension of the
Program would require payment of an additional fee.
6. RECENT ACCOUNTING PRONOUNCEMENT
In March 2008, the Financial Accounting Standards Board ("FASB") issued
Statement on Financial Accounting Standards ("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 Fund uses derivative instruments, how these
activities are accounted for, and their effect on the Fund's financial position,
financial performance and cash flows. SFAS No. 161 is effective for financial
statements issued for fiscal years and interim periods beginning after November
15, 2008. At this time, management is evaluating the implications of SFAS No.
161 and its impact on the Fund's financial statements and related disclosures.
F17 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
THIS PAGE INTENTIONALLY LEFT BLANK.
F18 | OPPENHEIMER INSTITUTIONAL MONEY MARKET 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, 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, (v) whether 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.
Outlined below is a summary of the principal information considered by the
Board as well as the Board's conclusions.
NATURE, QUALITY 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.
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
13 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
BOARD APPROVAL OF THE FUND'S INVESTMENT ADVISORY AGREEMENT Unaudited / Continued
the Manager has had over forty years of experience as an investment adviser and
that its assets under management rank it among the top mutual fund managers in
the United States. The Board evaluated the Manager's advisory, administrative,
accounting, legal and compliance services, and information the Board has
received regarding the experience and professional qualifications of the
Manager's key 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 Carol Wolf, the portfolio manager for the
Fund, and the Manager's investment team and analysts. The Board members also
considered the totality of their experiences with the Manager as directors or
trustees 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. The Board concluded, in light
of the Manager's experience, reputation, personnel, operations and resources,
the Fund benefits from the services provided under the Agreement.
INVESTMENT PERFORMANCE OF THE MANAGER AND THE FUND. Throughout the year,
the Manager provided information on the investment performance of the Fund and
the Manager, 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 institutional money market funds advised by other
investment advisers. The Board noted that the Fund's one-year and since
inception performance were better than its peer group median.
COSTS OF SERVICES BY THE MANAGER. The Board reviewed the fees paid to the
Manager 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 and institutional money market funds with comparable asset
levels and distribution features. The Board considered that the Manager has
agreed to voluntarily waive its management fees or reimburse expenses such that
total expenses after waivers, payments and/or reduction to custodian fees will
not exceed 0.15% for Class E and L shares and 0.20% for Class P shares. The
Board noted that the Fund's contractual and actual management fees and total
expenses are lower than its peer group median.
ECONOMIES OF SCALE. 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 reviewed whether the Manager may
14 | OPPENHEIMER INSTITUTIONAL MONEY MARKET FUND
realize economies of scale in managing and supporting the Fund, whether those
economies of scale benefit the Fund's shareholders at the current level of Fund
assets in relation to its management fee.
OTHER BENEFITS TO THE MANAGER. In addition to considering the profits
realized by the Manager, the Board considered information that was provided
regarding the direct and indirect benefits the Manager receives as a result of
its relationship with the Fund, including compensation paid to the Manager's
affiliates. The Board also considered that the Manager must be able to pay and
retain experienced professional personnel at competitive rates to provide
quality 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.
CONCLUSIONS. These factors were also considered by the independent Trustees
meeting separately from the full Board, assisted by experienced counsel to the
Fund and to the independent Trustees. Fund counsel and the independent Trustees'
counsel are 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,
decided 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 above information, and
considered the terms and conditions of the Agreement, including the management
fee, in light of all of the surrounding circumstances.
15 | OPPENHEIMER INSTITUTIONAL MONEY MARKET 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.
16 | OPPENHEIMER INSTITUTIONAL MONEY MARKET 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.
a) Not applicable.
b) 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 11/30/2008, 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) 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 Institutional Money Market Fund
By: /s/ John V. Murphy
------------------------------------
John V. Murphy
Principal Executive Officer
Date: 01/15/2009
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: 01/15/2009
By: /s/ Brian W. Wixted
-----------------------------------
Brian W. Wixted
Principal Financial Officer
Date: 01/15/2009