Lead Manager

SECTION 6
INDEPENDENT ACCOUNTANTS’ REPORTS
TRANSACTION SUPPORT
9 September 2004
The Ernst & Young Building
321 Kent Street
Sydney NSW 2000
Australia
GPO Box 2646
Sydney NSW 2001
Tel 61 2 9248 5555
Fax 61 2 9248 5212
DX Sydney Stock
Exchange 10172
The Directors
Babcock & Brown Limited
Level 39, Chifley Tower
2 Chifley Square
SYDNEY NSW 2000
Dear Directors
Independent Accountant’s Report on Pro-Forma Forecast Financial Information
Ernst & Young Transaction Advisory Services Limited has prepared this Independent Accountant’s Report
(the “Report”) in relation to certain pro-forma consolidated forecast financial information of Babcock & Brown
Limited (“Babcock & Brown”) for the two years ending 31 December 2005 for inclusion in a Prospectus to be
dated on or about 9 September 2004 (the “Prospectus”) relating to the initial public offering (“IPO”) of shares in
Babcock & Brown.
Expressions defined in the Prospectus have the same meaning in this Report.
The nature of this Report is such that it can be given only by an entity, which holds an Australian Financial
Services License under the Corporations Act. Ernst & Young Transaction Advisory Services Limited holds the
appropriate Australian Financial Services License.
Scope
You have requested Ernst & Young Transaction Advisory Services Limited to prepare a report, for inclusion in the
Prospectus on the pro-forma consolidated forecast profit and loss statement of Babcock & Brown for the two
years ending 31 December 2005 (the “Forecast”) as set out in Sections 5.3.2.1 and 5.4.2 of the Prospectus.
The Forecast is presented in accordance with applicable Accounting Standards in Australia (“AGAAP”) and
Australian equivalents to International Financial Reporting Standards (“Australian IFRS”).The basis of Australian
IFRS is set out in Section 5.4.4 of the Prospectus.
Our Report relates only to the Forecast referred to above and does not extend to any other forecast financial
information included in the Prospectus including the restated statements of forecast financial performance set out
in Section 5.2.2 of the Prospectus.
The Forecast has been presented as if the Restructure had occurred as at 31 December 2003 and the initial
public offering and related capital raising occurred on 30 September 2004. However, the Forecast does not
incorporate the financial implications of the fair value adjustments to assets and liabilities as part of the
application of purchase price accounting under AGAAP or the forecast gains and losses on the close-out
of hedges related to the structure of the Group pre-IPO. These items are discussed in Section 5.3.2.1 of
the Prospectus.
Babcock & Brown currently relies on transactions to generate the majority of its revenue. Investors are
encouraged to read Section 5.3.2 of the Prospectus which summarises the basis of preparation of the Forecast
and, due to the nature of Babcock & Brown’s business, the additional uncertainties in relation to the Forecast.
Responsibility
The Directors are responsible for the preparation and presentation of the Forecast, including the best-estimate
assumptions, which include the pro-forma transactions, on which they are based.The Forecast has been prepared
for inclusion in the Prospectus.We disclaim any assumption of responsibility for any reliance on this Report or
on the Forecast to which it relates for any purposes other than for which it was prepared.This report should be
Transaction Support is a part of Ernst & Young Transaction Advisory Services Limited
ABN 87 003 599 844 Australian Financial Services Licence No. 240585
Liability limited by the Accountants Scheme, approved
under the Professional Standards Act 1994 (NSW).
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