diff --git a/pkg/compiler/codegen.go b/pkg/compiler/codegen.go
index e566055da..a74d4b420 100644
--- a/pkg/compiler/codegen.go
+++ b/pkg/compiler/codegen.go
@@ -758,6 +758,14 @@ func (c *codegen) Visit(node ast.Node) ast.Visitor {
 		}
 		// Do not swap for builtin functions.
 		if !isBuiltin {
+			if typ, ok := c.typeOf(n.Fun).(*types.Signature); ok && typ.Variadic() {
+				// pack variadic args into an array
+				varSize := len(n.Args) - typ.Params().Len() + 1
+				c.emitReverse(varSize)
+				emit.Int(c.prog.BinWriter, int64(varSize))
+				emit.Opcode(c.prog.BinWriter, opcode.PACK)
+				numArgs -= varSize - 1
+			}
 			c.emitReverse(numArgs)
 		}
 
@@ -1116,12 +1124,6 @@ func (c *codegen) convertSyscall(expr *ast.CallExpr, api, name string) {
 		c.prog.Err = fmt.Errorf("unknown VM syscall api: %s", name)
 		return
 	}
-	switch name {
-	case "Notify":
-		numArgs := len(expr.Args)
-		emit.Int(c.prog.BinWriter, int64(numArgs))
-		emit.Opcode(c.prog.BinWriter, opcode.PACK)
-	}
 	emit.Syscall(c.prog.BinWriter, api)
 	switch name {
 	case "GetTransaction", "GetBlock":
diff --git a/pkg/compiler/func_scope.go b/pkg/compiler/func_scope.go
index 5c202c8aa..b66c8e1dd 100644
--- a/pkg/compiler/func_scope.go
+++ b/pkg/compiler/func_scope.go
@@ -139,16 +139,18 @@ func (c *funcScope) stackSize() int64 {
 
 // newVariable creates a new local variable or argument in the scope of the function.
 func (c *funcScope) newVariable(t varType, name string) int {
-	c.i++
+	var n int
 	switch t {
 	case varLocal:
-		c.locals[name] = c.i
+		n = len(c.locals)
+		c.locals[name] = n
 	case varArgument:
-		c.arguments[name] = c.i
+		n = len(c.arguments)
+		c.arguments[name] = n
 	default:
 		panic("invalid type")
 	}
-	return c.i
+	return n
 }
 
 // newLocal creates a new local variable into the scope of the function.
diff --git a/pkg/compiler/function_call_test.go b/pkg/compiler/function_call_test.go
index c9d9ca04c..072542f58 100644
--- a/pkg/compiler/function_call_test.go
+++ b/pkg/compiler/function_call_test.go
@@ -169,3 +169,50 @@ func TestFunctionWithMultipleArgumentNames(t *testing.T) {
 	}`
 	eval(t, src, big.NewInt(3))
 }
+
+func TestLocalsCount(t *testing.T) {
+	src := `package foo
+	func f(a, b, c int) int {
+		sum := a
+		for i := 0; i < c; i++ {
+			sum += b
+		}
+		return sum
+	}
+	func Main() int {
+		return f(1, 2, 3)
+	}`
+	eval(t, src, big.NewInt(7))
+}
+
+func TestVariadic(t *testing.T) {
+	src := `package foo
+	func someFunc(a int, b ...int) int {
+		sum := a
+		for i := range b {
+			sum = sum - b[i]
+		}
+		return sum
+	}
+	func Main() int {
+		return someFunc(10, 1, 2, 3)
+	}`
+	eval(t, src, big.NewInt(4))
+}
+
+func TestVariadicMethod(t *testing.T) {
+	src := `package foo
+	type myInt int
+	func (x myInt) someFunc(a int, b ...int) int {
+		sum := int(x) + a
+		for i := range b {
+			sum = sum - b[i] 
+		}
+		return sum
+	}
+	func Main() int {
+		x := myInt(38)
+		return x.someFunc(10, 1, 2, 3)
+	}`
+	eval(t, src, big.NewInt(42))
+}