Lead Manager

BABCOCK & BROWN PROSPECTUS
The AGAAP Financial Information and Australian IFRS Financial Information has been prepared on the basis
that the Restructure of Babcock & Brown and the IPO and related transactions had taken place on 31 December
2003.The AGAAP and Australian IFRS pro-forma Forecasts of financial performance have been prepared on the
basis that the $550 million capital raising as part of the IPO occurred on 30 September 2004.
Details of the key assumptions on which the AGAAP and Australian IFRS pro-forma Forecasts of financial
performance are based are contained in Sections 5.3.2.2 and 5.4.2, respectively.
Quantification of the impact of varying certain of the key assumptions underlying the AGAAP pro-forma
Forecasts of financial performance is contained in Section 5.3.2.3.
The financial information contained in this Section is presented in an abbreviated form and does not contain all
the disclosures that are usually provided in an annual report prepared in accordance with the Corporations Act
2001. Further detailed historical financial information is contained in the pro-forma financial statements of
Babcock & Brown contained in Appendix A of this document.The pro-forma financial information prepared
under AGAAP contained in this Section has been prepared in accordance with the accounting policies set out in
note 1 of Appendix A. Detailed reconciliations between AGAAP and Australian IFRS are set out in notes 5 and 6
of Appendix A.
As noted in Section 2.4, the pre-IPO US Executive Stakeholders will hold their interests in the restructured
Group through BBIPL rather than in the listed vehicle. Despite the different legal interests, the economic interests
of the pre-IPO US Executive Stakeholders and all other Shareholders following the IPO are economically
materially equivalent.The Restated Financial Information is prepared for the entire Babcock & Brown Group.
The AGAAP Financial Information and the Australian IFRS Financial Information are prepared on a comparable
basis to the Restated Financial Information but also include a deduction for outside equity interests relating to
the pre-IPO US Executive Stakeholders.This treatment is consistent with relevant accounting standards. As noted
in Section 2.5, it is expected that new Shareholders who subscribe for Shares as part of the IPO, will have an
Economic Interest in the Group of approximately 33.9% following the Restructure. However, because pre-IPO
US Executive Stakeholders hold at the BBIPL level, the interest of new Shareholders in the listed vehicle will
amount to approximately 48.4%.
Ernst & Young has reviewed the pro-forma financial statements contained in Appendix A.The Independent
Accountant’s Report on these pro-forma financial statements is set out in Section 6. Ernst & Young Transaction
Advisory Services Limited has reviewed the pro-forma Forecast of financial performance prepared under AGAAP
and Australian IFRS contained in Section 5.3.2 and Section 5.4.2, respectively.The Independent Accountant’s
Report on these pro-forma Forecasts of financial performance is contained in Section 6.The Independent
Accountants’ Reports relate solely to the information referred to above and do not relate to the Restated
Financial Information contained in Section 5.2 and elsewhere in this Prospectus.
The pro-forma financial statements and the pro-forma Forecasts of financial performance should be read in
conjunction with the Independent Accountants’ Reports and investors should note the comments in relation to
scope and limitations contained in those reports.The pro-forma Forecasts of financial performance should also be
read together with the assumptions underlying their preparation, as set out in Sections 5.3.2.2 and 5.4.2, the risk
factors set out in Section 7 and other information contained in this Prospectus. Undue reliance should not be
placed on the pro-forma Forecasts of financial performance. Refer Section 5.3.2 for important commentary in
this regard.
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