(Mark One)
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o
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REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
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OR
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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2019
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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OR
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o
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Title of each class
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Trading Symbols
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Name of each exchange on which registered
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Limited Partnership Units
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BBU
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New York Stock Exchange
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Limited Partnership Units
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BBU.UN
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Toronto Stock Exchange
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Large accelerated filer ý
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Accelerated filer o
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Non-accelerated filer o
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Emerging growth company o
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o U.S. GAAP
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ý International Financial Reporting Standards as issued by the
International Accounting Standards Board
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o Other
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Page
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i
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Brookfield Business Partners
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Brookfield Business Partners
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ii
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•
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“Altera Infrastructure” means Altera Infrastructure L.P.;
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•
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“assets under management” mean assets managed by us or by Brookfield on behalf of our third-party investors, as well as our own assets, and also include capital commitments that have not yet been drawn. Our calculation of assets under management may differ from that employed by other asset managers and, as a result, this measure may not be comparable to similar measures presented by other asset managers;
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“attributable to the partnership” and “attributable to unitholders” means attributable to limited partner, general partner, redemption-exchange unitholders, preferred shareholders and Special LP unitholders;
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“Backlog” represents an estimate of revenue to be recognized in future financial periods from contracts currently secured. Backlog is not indicative of future revenue, as we cannot guarantee that the revenue projected in our backlog will be realized or that it will exceed cost and generate profit. Projects may remain in our backlog for an extended period of time. Furthermore, variations in projects may occur with respect to contracts included in our backlog that could reduce the dollar amount of our backlog and the revenue and profits that we eventually realize;
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“BBU General Partner” means Brookfield Business Partners Limited, a wholly-owned subsidiary of Brookfield Asset Management;
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“Bermuda Holdco” means Brookfield BBP Bermuda Holdings Limited;
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“BGIS” means Brookfield Global Integrated Solutions Canada L.P.;
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“BGRS” means Brookfield Global Relocation Services;
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“boe” or “BOE” means barrels of oil equivalent, with six thousand cubic feet of natural gas being equivalent to one barrel of oil;
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“boe/d” or “BOE/d” means barrels of oil equivalent per day;
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“BOF” means blast furnace;
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“BrandSafway” means Brand Industrial Services, Inc.;
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“Brookfield” means Brookfield Asset Management and any subsidiary of Brookfield Asset Management, other than us;
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“Brookfield Accounts” means Brookfield-sponsored vehicles, consortiums and/or partnerships (including private funds, joint ventures and similar arrangements);
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“Brookfield Asset Management” means Brookfield Asset Management Inc.;
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“CanHoldco” means Brookfield BBU Canada Holdings Inc.;
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“Cardone” means Cardone Industries, Inc.;
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•
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“CBCA” means Canada Business Corporations Act;
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“CBM properties” means coal-bed methane properties;
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•
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“CDS” means Clearing and Depository Services Inc.;
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•
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“Clarios” means Clarios Global LP;
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•
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“Company EBITDA” means Company FFO excluding the impact of realized disposition gains, interest expense, cash taxes, and realized disposition gains, current income taxes and interest expense related to equity accounted investments;
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1
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Brookfield Business Partners
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•
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“Company FFO” means funds from operations, which is calculated as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, non-cash valuation gains or losses and other items;
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“Consortium” means our company and the various institutional clients of Brookfield Asset Management;
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•
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“DHB” means District Health Board;
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•
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“DTC” means the Depository Trust Company;
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“EAF” means electric arc furnace;
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“EBITDA” means earnings before interest, taxes, depreciation and amortization;
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“Ember” means Ember Resources;
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•
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“FATCA” means Foreign Account Tax Compliance provisions of the Hiring Incentives to Restore Employment Act of 2010;
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•
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“FPSO” means floating production storage and offloading unit;
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“FSO” means floating storage and offloading unit;
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“Genworth” means Genworth MI Canada Inc.;
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“GP Units” means general partnership units in our company;
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“GrafTech” means GrafTech International Ltd.;
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“Healthscope” means Healthscope Limited;
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“Holding Entities” means the primary holding subsidiaries of the Holding LP, from time to time, through which it indirectly holds all of our interests in our operating businesses, including CanHoldco, US Holdco and Bermuda Holdco;
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“Holding LP” means Brookfield Business L.P.;
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“Holding LP Limited Partnership Agreement” means the amended and restated limited partnership agreement of the Holding LP;
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“HPPA” means Hospital Purchaser-Provider Agreement;
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“IASB” means the International Accounting Standards Board;
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“IBOR Amendments” means Interest Rate Benchmark Reform - Amendments to IFRS 9, and IFRS 7, issued in September 2019;
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“IFRIC 23” means IFRIC 23, Uncertainty over Income Tax Treatments;
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“IFRS” means the International Financial Reporting Standards as issued by the IASB;
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“IFRS 3” means IFRS 3, Business combinations;
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“IFRS 16” means IFRS 16, Leases;
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“Imagine” means Imagine Communications Group;
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“incentive distribution” means the distribution payable to holders of Special LP Units as described under “Related Party Transactions-Incentive Distributions”;
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“IndoStar” means IndoStar Capital Finance Limited;
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“LIBOR” means the London Interbank offered rate;
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“Licensing Agreement” means the licensing agreement which our company and the Holding LP have entered into;
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“limited partners” means the holders of our units;
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“Limited Partnership Agreements” means our Limited Partnership Agreement and Holding LP Limited Partnership Agreement;
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Brookfield Business Partners
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2
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•
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“Managing General Partner Units” means the general partner interests in the Holding LP having the rights and obligations specified in the Holding LP Limited Partnership Agreement;
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“Master Services Agreement” means the master services agreement among the Service Recipients, the Service Providers, and certain other subsidiaries of Brookfield Asset Management who are parties thereto;
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“Mcf” means one thousand cubic feet;
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“MI 61-101” means Multilateral Instrument 61-101-Protection of Minority Security Holders in Special Transactions;
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“NAP” means North American Palladium Ltd.;
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“NI 51-102” means National Instrument 51-102-Continuous Disclosure Obligations;
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“NCIB” means normal course issuer bid;
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“Non-Resident Subsidiaries” means the subsidiaries of Holding LP that are corporations and that are not resident or deemed to be resident in Canada for purposes of the Tax Act;
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“Non-U.S. Holder” means a beneficial owner of one or more units, other than a U.S. Holder or an entity classified as a partnership or other fiscally transparent entity for U.S. federal tax purposes;
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“Nova Cold” means Nova Cold Logistics ULC;
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“NYSE” means New York Stock Exchange;
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“Oaktree” means Oaktree Capital Group, LLC together with its affiliates;
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“Oaktree Accounts” means Oaktree-managed funds and accounts;
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“OEM” means original equipment manufacturer;
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“Offering” means the June 2019 public offering of 8,760,000 units, to a syndicate of underwriters at a price of $39.40 per unit for gross proceeds of approximately $345 million;
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“oil and gas” means crude oil and natural gas;
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“operating businesses” means the businesses in which the Holding Entities hold interests and that directly or indirectly hold our operations and assets other than entities in which the Holding Entities hold interests for investment purposes only of less than 5% of the equity securities;
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“our business” means our business of owning and operating business services and industrial operations, both directly and through our Holding Entities and other intermediary entities;
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“our company” or “our partnership” means Brookfield Business Partners L.P., a Bermuda exempted limited partnership;
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•
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“our Limited Partnership Agreement” means the amended and restated limited partnership agreement of our company;
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“our operations” means the business services and industrial operations we own;
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•
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“Ouro Verde” means Ouro Verde Locação e Seviços S.A.;
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“parent company” means Brookfield Asset Management;
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“PPP” means Public Private Partnerships;
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“Redemption-Exchange Mechanism” means the mechanism by which Brookfield may request redemption of its redemption-exchange units in whole or in part in exchange for cash, subject to the right of our company to acquire such interests (in lieu of such redemption) in exchange for units of our company;
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•
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“redemption-exchange units” means the non-voting limited partnership interests in the Holding LP that are redeemable for cash, subject to the right of our company to acquire such interests (in lieu of such redemption) in exchange for units of our company, pursuant to the Redemption-Exchange Mechanism;
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•
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“Relationship Agreement” means the agreement under which Brookfield Asset Management has agreed that we will serve as the primary entity through which Brookfield will own and operate its business services and industrial operations;
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3
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Brookfield Business Partners
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•
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“Sarbanes-Oxley Act” means the Sarbanes-Oxley Act of 2002, as amended;
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•
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“Schoeller Allibert” means Schoeller Allibert Group B.V.;
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“SEC” means the U.S. Securities and Exchange Commission;
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•
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“Service Providers” means the affiliates of Brookfield that provide services to us pursuant to our Master Services Agreement, which are expected to be Brookfield Asset Management (Barbados) Inc., Brookfield Asset Management Private Institutional Capital Adviser (Private Equity), L.P., Brookfield Canadian Business Advisor L.P., Brookfield Canadian GP L.P. and Brookfield Global Business Advisors Limited, which are wholly-owned subsidiaries of Brookfield Asset Management, and unless the context otherwise requires, any other affiliate of Brookfield that is appointed by Brookfield Global Business Advisor Limited from time to time to act as a Service Provider pursuant to our Master Services Agreement or to whom the Service Providers have subcontracted for the provision of such services;
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•
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“Service Recipients” means our company, the Holding LP, the Holding Entities and, at the option of the Holding Entities, any wholly-owned subsidiary of a Holding Entity excluding any operating business;
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•
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“Special LP Units” means special limited partnership units of the Holding LP;
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•
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“spin-off” means the special dividend of our units by Brookfield Asset Management completed on June 20, 2016;
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•
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“Tax Act” means the Income Tax Act (Canada), together with the regulation thereunder;
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•
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“Teekay Offshore” means Teekay Offshore Partners L.P.;
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•
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“Teekay Offshore GP” means Teekay Offshore GP LLC;
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•
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“TSX” means the Toronto Stock Exchange;
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•
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“unitholders” means the holders of our units;
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•
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“units” or “LP Units” means the non-voting limited partnership units in our company;
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•
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“US Holdco” means Brookfield BBP US Holdings LLC;
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•
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“U.S. Holder” means a beneficial owner of one or more of our units that is for U.S. federal tax purposes (i) an individual citizen or resident of the United States; (ii) a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source; or (iv) a trust (a) that is subject to the primary supervision of a court within the United States and all substantial decisions of which one or more U.S. persons have the authority to control or (b) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person; and
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•
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“Westinghouse” means Westinghouse Electric Company.
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Brookfield Business Partners
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4
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5
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Brookfield Business Partners
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Brookfield Business Partners
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6
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•
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other risks and factors discussed in this Form 20-F in Item 3.D., “Risk Factors” and as detailed from time to time in other documents we file with the securities regulators in Canada and the United States.
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7
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Brookfield Business Partners
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Year Ended December 31,
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(US$ Millions, except per unit amounts)
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2019
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2018
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2017
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2016
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2015
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Statements of Operating Results Data
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Revenues
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$
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43,032
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$
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37,168
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$
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22,823
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$
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7,960
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$
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6,753
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Direct operating costs
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(38,327
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)
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(34,134
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)
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(21,876
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)
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(7,386
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)
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(6,132
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)
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General and administrative expenses
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(832
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)
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(643
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)
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(340
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)
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(269
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)
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(224
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)
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Depreciation and amortization expense
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(1,804
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)
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(748
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)
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(371
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)
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(286
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)
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(257
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)
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Interest income (expense), net
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(1,274
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)
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(498
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)
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(202
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)
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(90
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)
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(65
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)
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Equity accounted income, net
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114
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10
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69
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68
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4
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Impairment expense, net
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(609
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)
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(218
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)
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(39
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)
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(261
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)
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(95
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)
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Gain on acquisitions/dispositions, net
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726
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500
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267
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57
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269
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Other income (expenses), net
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(400
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)
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(136
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)
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(108
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)
|
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(11
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)
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70
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Income (loss) before income tax
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626
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1,301
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|
223
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(218
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)
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323
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Current income tax expense
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(324
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)
|
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(186
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)
|
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(30
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)
|
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(25
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)
|
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(49
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)
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Deferred income tax (expense) recovery
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132
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|
|
88
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22
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|
41
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(5
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)
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Net income (loss)
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$
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434
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$
|
1,203
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$
|
215
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$
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(202
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)
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$
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269
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Attributable to:
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Limited partners
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$
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43
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$
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74
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$
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(58
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)
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$
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3
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$
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—
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Brookfield Asset Management Inc. (1)
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—
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—
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—
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(35
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)
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208
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Non-controlling interests attributable to:
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Redemption-Exchange Units held by Brookfield Asset Management Inc. (2)
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45
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70
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(60
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)
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3
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—
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Special Limited Partners
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—
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278
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|
|
142
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—
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—
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Interest of others
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346
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|
781
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191
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(173
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)
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|
61
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|
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Net income (loss)
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$
|
434
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|
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$
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1,203
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|
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$
|
215
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|
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$
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(202
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)
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$
|
269
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Basic and diluted earnings per limited partner unit (3) (4)
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$
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0.62
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$
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1.11
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$
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(1.04
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)
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$
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0.06
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(1)
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For the periods prior to June 20, 2016.
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(2)
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For the periods subsequent to June 20, 2016.
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(3)
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Comparative figures for the year ended December 31, 2015 are not representative of performance, as units were spun out on June 20, 2016.
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(4)
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Average number of partnership units outstanding on a fully diluted time weighted average basis, assuming the exchange of redemption exchange units held by Brookfield Asset Management for LP Units, for the year ended December 31, 2019 was 140.1 million (2018: 129.3 million, 2017: 113.5 million, 2016: 92.9 million).
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Brookfield Business Partners
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8
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(US$ MILLIONS)
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December 31,
2019 |
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December 31,
2018 |
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December 31,
2017 |
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Statements of Financial Position data
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Cash and cash equivalents
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$
|
1,986
|
|
|
$
|
1,949
|
|
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$
|
1,106
|
|
Total assets
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$
|
51,751
|
|
|
$
|
27,318
|
|
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$
|
15,804
|
|
Corporate borrowings
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-recourse borrowings in subsidiaries of the partnership
|
$
|
22,399
|
|
|
$
|
10,866
|
|
|
$
|
3,265
|
|
Equity attributable to:
|
|
|
|
|
|
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Limited partners
|
$
|
2,116
|
|
|
$
|
1,548
|
|
|
$
|
1,585
|
|
Non-controlling interests attributable to:
|
|
|
|
|
|
||||||
Redemption-Exchange Units, Preferred Shares and Special Limited Partnership Units held by Brookfield Asset Management Inc.
|
1,676
|
|
|
1,415
|
|
|
1,453
|
|
|||
Interests of others in operating subsidiaries
|
7,261
|
|
|
3,531
|
|
|
3,026
|
|
|||
Total equity
|
$
|
11,053
|
|
|
$
|
6,494
|
|
|
$
|
6,064
|
|
9
|
Brookfield Business Partners
|
Brookfield Business Partners
|
10
|
11
|
Brookfield Business Partners
|
Brookfield Business Partners
|
12
|
13
|
Brookfield Business Partners
|
Brookfield Business Partners
|
14
|
15
|
Brookfield Business Partners
|
Brookfield Business Partners
|
16
|
17
|
Brookfield Business Partners
|
Brookfield Business Partners
|
18
|
19
|
Brookfield Business Partners
|
Brookfield Business Partners
|
20
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•
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difficulties related to the performance of our clients, partners, subcontractors, suppliers or other third parties;
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•
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changes in local laws or difficulties or delays in obtaining permits, rights of way or approvals;
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•
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unanticipated technical problems, including design or engineering issues;
|
•
|
insufficient or inadequate project execution tools and systems needed to record, track, forecast and control cost and schedule;
|
•
|
unforeseen increases in, or failures to, properly estimate the cost of raw materials, components, equipment, labor or the inability to timely obtain them;
|
•
|
delays or productivity issues caused by weather conditions;
|
•
|
incorrect assumptions related to productivity, scheduling estimates or future economic conditions; and
|
•
|
project modifications creating unanticipated costs or delays.
|
21
|
Brookfield Business Partners
|
Brookfield Business Partners
|
22
|
•
|
decreases in the actual or projected price of oil, which could lead to a reduction in or termination of production of oil at certain fields we service or a reduction in exploration for or development of new offshore oil fields;
|
•
|
increases in the production of oil in areas linked by pipelines to consuming areas, the extension of existing, or the development of new, pipeline systems in markets we may serve, the conversion of existing non-oil pipelines to oil pipelines in those markets, or the termination of production or abandonment of an oil field;
|
•
|
decreases in the consumption of oil due to increases in its price relative to other energy sources, other factors making consumption of oil less attractive, or energy conservation measures;
|
•
|
significant installment payments for acquisitions of newbuilding vessels or for the conversion of existing vessels prior to their delivery and generation of revenue;
|
•
|
reliance on a limited number of customers for a substantial majority of our revenues and on joint venture partners to assist us in operating our businesses and competing in our markets;
|
•
|
availability of new, alternative energy sources; and
|
•
|
negative global or regional economic or political conditions, particularly in oil consuming regions, which could reduce energy consumption or its growth. Reduced demand for offshore marine transportation, processing, storage services, offshore accommodation or towing and offshore installation services would have a material adverse effect on our future growth and could harm our business, results of operations and financial condition.
|
•
|
marine disasters;
|
•
|
bad weather;
|
•
|
mechanical failures;
|
•
|
grounding, capsizing, fire, explosions and collisions;
|
•
|
piracy;
|
•
|
human error; and
|
•
|
war and terrorism.
|
•
|
death or injury to persons, loss of property or damage to the environment and natural resources;
|
•
|
delays in the delivery of cargo;
|
•
|
loss of revenues from charters or contracts of affreightment;
|
•
|
liabilities or costs to recover any spilled oil or other petroleum products and to restore the eco-system affected by the spill;
|
•
|
governmental fines, penalties or restrictions on conducting business;
|
•
|
higher insurance rates; and
|
23
|
Brookfield Business Partners
|
•
|
damage to our reputation and customer relationships generally.
|
•
|
industry relationships and reputation for customer service and safety;
|
•
|
experience and quality of ship operations;
|
•
|
quality, experience and technical capability of the crew;
|
•
|
relationships with shipyards and the ability to get suitable berths;
|
•
|
construction management experience, including the ability to obtain on-time delivery of new vessels or conversions according to customer specifications;
|
•
|
willingness to accept operational risks pursuant to the charter, such as allowing termination of the charter for force majeure events; and
|
•
|
competitiveness of the bid in terms of overall price.
|
Brookfield Business Partners
|
24
|
•
|
The government may impose restrictions on water usage as a response to regional or seasonal drought, which may result in decreased use of water services, even if our water supplies are sufficient to serve our customers. Moreover, reductions in water consumption, including changed consumer behavior, may persist even after drought restrictions are repealed and the drought has ended.
|
•
|
The business will require significant capital expenditures and may suffer if we fail to secure appropriate funding to make investments, or if we experience delays in completing major capital expenditure projects.
|
•
|
In the event that water contamination occurs, there may be injury, damage or loss of life to our customers, employees or others, in addition to government enforcement actions, litigation, adverse publicity and reputational damage.
|
•
|
Water and wastewater businesses may be subject to organized efforts to convert their assets to public ownership and operation through exercise of the governmental power of eminent domain, or another similar authorized process. Moreover, there is a risk that any efforts to resist may be costly, distracting or unsuccessful.
|
•
|
Water related businesses are subject to extensive governmental economic regulation including with respect to the approval of rates.
|
•
|
blowouts, cratering, explosions and fires;
|
•
|
adverse weather effects;
|
•
|
environmental hazards such as gas leaks, oil spills, pipeline and vessel ruptures and unauthorized discharges of gasses, brine, well stimulation and completion fluids or other pollutants into the surface and subsurface environment;
|
•
|
high costs, shortages or delivery delays of equipment, labor or other services or water and sand for hydraulic fracturing;
|
•
|
facility or equipment malfunctions, failures or accidents;
|
•
|
title problems;
|
25
|
Brookfield Business Partners
|
•
|
pipe or cement failures or casing collapses;
|
•
|
compliance with environmental and other governmental requirements;
|
•
|
lost or damaged oilfield workover and service tools;
|
•
|
unusual or unexpected geological formations or pressure or irregularities in formations;
|
•
|
natural disasters; and
|
•
|
the availability of critical materials, equipment and skilled labor.
|
•
|
unexpected drilling conditions;
|
•
|
pressure or irregularities in formations;
|
•
|
equipment failures or accidents;
|
•
|
fires, explosions, blow-outs and surface cratering;
|
•
|
marine risks such as capsizing, collisions and hurricanes;
|
•
|
other adverse weather conditions; and
|
•
|
increase in cost of, or shortages or delays in the delivery of equipment.
|
Brookfield Business Partners
|
26
|
27
|
Brookfield Business Partners
|
•
|
It is an integral part of Brookfield’s (and our) strategy to pursue acquisitions through consortium arrangements with institutional investors, strategic partners and/or financial sponsors and to form partnerships (including private funds, joint ventures and similar arrangements) to pursue such acquisitions on a specialized or global basis. Although Brookfield has agreed with us that it will not enter any such arrangements that are suitable for us without giving us an opportunity to participate in them, there is no minimum level of participation to which we will be entitled;
|
•
|
The same professionals within Brookfield’s organization that are involved in sourcing acquisitions that are suitable for us are responsible for sourcing opportunities for the vehicles, consortiums and partnerships referred to above, as well as having other responsibilities within Brookfield’s broader asset management business. Limits on the availability of such individuals could result in a limitation on the number of acquisition opportunities sourced for us;
|
•
|
Brookfield will only recommend acquisition opportunities that it believes are suitable and appropriate for us. Our focus is on assets where we believe that our operations-oriented strategy can be deployed to create value in our business services and industrial operations. Accordingly, opportunities where Brookfield cannot play an active role in influencing the underlying business or managing the underlying assets may not be consistent with our acquisition strategy and, therefore may not be suitable for us, even though they may be attractive from a purely financial perspective. Legal, regulatory, tax and other commercial considerations will likewise be an important consideration in determining whether an opportunity is suitable and/or appropriate for us and will limit our ability to participate in certain acquisitions; and
|
•
|
In addition to structural limitations, the question of whether a particular acquisition is suitable and/or appropriate is highly subjective and is dependent on a number of portfolio construction and management factors including our liquidity position at the relevant time, the expected risk-return profile of the opportunity, its fit with the balance of our investments and related operations, other opportunities that we may be pursuing or otherwise considering at the relevant time, our interest in preserving capital in order to secure other opportunities and/or to meet other obligations, and other factors. If Brookfield determines that an opportunity is not suitable or appropriate for us, it may still pursue such opportunity on its own behalf, or on behalf of a Brookfield-sponsored vehicle, consortium or partnership such as Brookfield Property Partners, Brookfield Infrastructure Partners, Brookfield Renewable Partners, and one or more Brookfield-sponsored private funds or other investment vehicles or programs.
|
Brookfield Business Partners
|
28
|
29
|
Brookfield Business Partners
|
Brookfield Business Partners
|
30
|
31
|
Brookfield Business Partners
|
Brookfield Business Partners
|
32
|
33
|
Brookfield Business Partners
|
Brookfield Business Partners
|
34
|
35
|
Brookfield Business Partners
|
Brookfield Business Partners
|
36
|
37
|
Brookfield Business Partners
|
Brookfield Business Partners
|
38
|
39
|
Brookfield Business Partners
|
Brookfield Business Partners
|
40
|
41
|
Brookfield Business Partners
|
Brookfield Business Partners
|
42
|
43
|
Brookfield Business Partners
|
Brookfield Business Partners
|
44
|
Date
|
|
Segment
|
|
Event
|
April 2019
|
|
Corporate and other
|
|
In April 2019, together with institutional partners, we recapitalized Cardone for approximately $195 million, which is being used to support near term liquidity requirements in the business. Cardone is a U.S. remanufacturer of automotive aftermarket replacement parts. Our investment was classified as a financial asset on the consolidated statements of financial position.
|
|
|
Industrials
|
|
In April 2019, together with institutional partners, we completed a secondary sale of shares of NAP, our palladium mining operations. We sold approximately 5.7 million shares for $10 per share, which generated net proceeds of approximately $15 million to the partnership and reduced our ownership in the business to 20%.
|
|
|
Industrials
|
|
In April 2019, together with institutional partners, we closed our acquisition of Clarios for a purchase price of approximately $13.2 billion. The transaction was funded with approximately $3 billion of equity, of which our share was approximately $860 million for a 29% ownership interest. Subsequent to acquisition, we syndicated a portion of our investment to institutional partners.
|
May 2019
|
|
Infrastructure services
|
|
In May 2019, together with institutional partners, we acquired all of Teekay Corporation’s remaining interests in Teekay Offshore, including its 49% general partner interest, LP Units, warrants and a loan commitment for a total of $100 million. Following the transaction, the ownership interest of the partnership, together with institutional partners, in Teekay Offshore was 73%. Our share was approximately $45 million, increasing our ownership interest from 25% to 31%.
|
|
|
Industrials
|
|
In May 2019, together with institutional partners, we invested approximately $75 million of additional capital into Ember. Our share was approximately $45 million, increasing our ownership interest in Ember to 46%.
|
|
|
Business services
|
|
In May 2019, together with institutional partners, we closed on the sale of BGIS, our facilities management business, to CCMP Capital Advisors, LP for approximately $1 billion. Our share of the net proceeds from the sale was approximately $171 million after taxes.
|
45
|
Brookfield Business Partners
|
June 2019
|
|
Business services
|
|
In June 2019, together with institutional partners, we closed our acquisition of 100% of Healthscope for a purchase price of approximately $4.1 billion, including $1 billion of equity. Healthscope is the second largest private hospital operator in Australia and the largest pathology services provider in New Zealand. We funded approximately $295 million of the investment for a 28% ownership interest. Subsequent to acquisition, we syndicated a portion of our investment to institutional partners. The remainder of the purchase price was funded with approximately $1.4 billion in debt financing and $1.7 billion from the sale and leaseback of 22 wholly owned freehold hospital properties.
|
|
|
Corporate and other
|
|
In June 2019, we issued 8,760,000 LP Units on a bought deal basis, to a syndicate of underwriters (collectively the “Underwriters”) in the Offering at a price of $39.40 per unit for gross proceeds of approximately $345 million. In addition, Brookfield, concurrent with the Offering, purchased 6,610,000 redemption-exchange units for total proceeds of approximately $250 million. Concurrent with the Offering, we also issued 5,077,000 LP Units by way of a private placement to an institutional investor for gross proceeds of approximately $200 million.
|
|
|
Business services
|
|
In June 2019, we closed the sale of BGRS, our global executive relocation business, to Relo Group, Inc. for net proceeds of approximately $231 million to the partnership.
|
July 2019
|
|
Business services
|
|
In July 2019, together with institutional partners, we completed the acquisition of 100% of the equity capital of Ouro Verde, a Brazilian fleet management company. We funded approximately $50 million of the acquisition from existing liquidity, for a 38% ownership interest, and the balance of equity was provided by institutional partners. Subsequent to acquisition, we syndicated a portion of our investment to institutional partners.
|
|
|
Corporate and other
|
|
As a part of the Offering, the Underwriters were provided an over-allotment option to purchase additional LP Units at $39.40 per unit. In July 2019, the Underwriters partially exercised their over-allotment option and purchased 1,070,000 additional units for additional gross proceeds to the partnership of approximately $42 million.
|
August 2019
|
|
Corporate and other
|
|
In August 2019, we renewed the NCIB for our units. Under the NCIB, we are authorized to repurchase annually up to 5% of our issued and outstanding units, or 4,050,188 units, including up to 18,026 units on the TSX during any trading day. We can make one block purchase per week which exceeds this daily purchase restriction, subject to the annual aggregate limit. Repurchases were authorized to commence on August 15, 2019 and will terminate on August 14, 2020. During the year ended December 31, 2019, a total of 202,143 units had been repurchased.
|
December 2019
|
|
Business services
|
|
In December 2019, together with institutional partners, we acquired 48,944,645 common shares of Genworth, representing an approximate 57% controlling interest in the business for approximately $1.7 billion of equity, of which we contributed approximately $941 million, and the balance of equity was provided by institutional partners. Subsequent to acquisition, we syndicated a portion of our investment to institutional partners. Genworth, through its subsidiary Genworth Financial Mortgage Insurance Company Canada, is the largest private sector residential mortgage insurer in Canada, providing mortgage default insurance to Canadian residential mortgage lenders.
|
|
|
Industrials
|
|
In December 2019, we completed a sale of GrafTech common shares to the market and the company, generating proceeds of approximately $400 million. Our share of the proceeds was approximately $135 million which reduced our ownership in GrafTech from 27% to 25%. An after-tax gain of $32 million was recognized in equity.
|
|
|
Industrials
|
|
In December 2019, together with institutional partners, we sold our interest in NAP to Impala Platinum Holdings Limited for approximately $572 million. Our share of the proceeds from the sale was approximately $132 million, after taxes.
|
January 2020
|
|
Business services
|
|
In January 2020, together with institutional partners, we closed the sale of Nova Cold, our Canadian cold storage owner, operator and logistics provider, to Americold Realty Trust for gross proceeds of approximately $255 million. Our share of the net proceeds from the sale was approximately $45 million.
|
Brookfield Business Partners
|
46
|
|
|
Infrastructure services
|
|
In January 2020, together with institutional partners, we acquired the remaining outstanding publicly held common units in Teekay Offshore for an aggregate investment of $165 million. We funded approximately $75 million of the transaction, which increased our ownership interest in Teekay Offshore to 43%. Following the transaction, 1% of the new private company is held by former minority unitholders who elected the option to exchange their publicly traded common units for economically equivalent units in the private company. We are rebranding the company to Altera Infrastructure.
|
|
|
Infrastructure services
|
|
In January 2020, together with institutional partners, we closed the acquisition of a 48% ownership interest in BrandSafway for a purchase price of $1.3 billion. BrandSafway is a leading provider of infrastructure services to industrial and commercial facilities. Our share of the equity investment is expected to be approximately $400 million, for an approximate 15% ownership interest, which will be finalized once investment syndication with institutional partners is complete.
|
|
|
Business services
|
|
In January 2020, together with institutional partners, we announced the acquisition of a 40% interest in IndoStar for approximately $220 million, of which our share is expected to be approximately $75 million. IndoStar is an Indian financing company that primarily services the used commercial vehicle segment. The transaction is expected to close in the second quarter of 2020.
|
(i)
|
Business services, including mortgage insurance services, healthcare services, road fuel distribution and marketing, real estate and construction services, entertainment, and other businesses;
|
(ii)
|
Infrastructure services, which includes a global provider of services to the power generation industry and a service provider to the offshore oil production industry;
|
(iii)
|
Industrials, which includes, automotive batteries, graphite electrode and other manufacturing, water and wastewater services, natural gas production and well servicing, and a variety of smaller industrial operations; and
|
(iv)
|
Corporate and other, which includes corporate cash and liquidity management, and activities related to the management of the partnership’s relationship with Brookfield.
|
47
|
Brookfield Business Partners
|
Operating segments
|
Assets
|
|
Revenue
|
||||
|
As at
|
|
For the year ended
|
||||
(US$ MILLIONS)
|
December 31, 2019
|
|
December 31, 2019
|
||||
Business services
|
$
|
18,132
|
|
|
$
|
28,822
|
|
Infrastructure services
|
10,619
|
|
|
4,559
|
|
||
Industrials
|
22,742
|
|
|
9,651
|
|
||
Corporate and other
|
258
|
|
|
—
|
|
||
Total
|
$
|
51,751
|
|
|
$
|
43,032
|
|
Region
|
Assets
|
|
Revenue
|
||||
|
As at
|
|
For the year ended
|
||||
(US$ MILLIONS)
|
December 31, 2019
|
|
December 31, 2019
|
||||
United Kingdom
|
$
|
5,060
|
|
|
$
|
20,202
|
|
United States of America
|
11,148
|
|
|
5,218
|
|
||
Europe
|
9,467
|
|
|
5,145
|
|
||
Australia
|
5,768
|
|
|
4,059
|
|
||
Canada
|
7,838
|
|
|
3,860
|
|
||
Other
|
4,152
|
|
|
2,050
|
|
||
Brazil
|
5,362
|
|
|
1,800
|
|
||
Mexico
|
2,956
|
|
|
698
|
|
||
Total
|
$
|
51,751
|
|
|
$
|
43,032
|
|
Brookfield Business Partners
|
48
|
|
Year ended December 31,
|
||||||||||
(US$ MILLIONS)
|
2019
|
|
2018
|
|
2017
|
||||||
United Kingdom
|
$
|
19,697
|
|
|
$
|
21,764
|
|
|
$
|
13,626
|
|
United States of America
|
324
|
|
|
482
|
|
|
451
|
|
|||
Europe
|
687
|
|
|
706
|
|
|
—
|
|
|||
Australia
|
4,042
|
|
|
2,937
|
|
|
2,884
|
|
|||
Canada
|
2,990
|
|
|
3,797
|
|
|
2,453
|
|
|||
Other
|
626
|
|
|
482
|
|
|
788
|
|
|||
Brazil
|
456
|
|
|
679
|
|
|
672
|
|
|||
Total
|
$
|
28,822
|
|
|
$
|
30,847
|
|
|
$
|
20,874
|
|
49
|
Brookfield Business Partners
|
Brookfield Business Partners
|
50
|
|
Year ended December 31,
|
||||||||||
(US$ MILLIONS)
|
2019
|
|
2018
|
|
2017
|
||||||
United Kingdom
|
$
|
377
|
|
|
$
|
120
|
|
|
$
|
—
|
|
United States of America
|
1,609
|
|
|
802
|
|
|
—
|
|
|||
Europe
|
1,569
|
|
|
902
|
|
|
—
|
|
|||
Australia
|
17
|
|
|
9
|
|
|
—
|
|
|||
Canada
|
117
|
|
|
58
|
|
|
—
|
|
|||
Other
|
618
|
|
|
386
|
|
|
3
|
|
|||
Brazil
|
247
|
|
|
141
|
|
|
—
|
|
|||
Mexico
|
5
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
4,559
|
|
|
$
|
2,418
|
|
|
$
|
3
|
|
51
|
Brookfield Business Partners
|
|
Year ended December 31,
|
||||||||||
(US$ MILLIONS)
|
2019
|
|
2018
|
|
2017
|
||||||
United Kingdom
|
$
|
128
|
|
|
$
|
99
|
|
|
$
|
—
|
|
United States of America
|
3,285
|
|
|
487
|
|
|
204
|
|
|||
Europe
|
2,889
|
|
|
1,301
|
|
|
314
|
|
|||
Australia
|
—
|
|
|
15
|
|
|
—
|
|
|||
Canada
|
753
|
|
|
828
|
|
|
762
|
|
|||
Other
|
806
|
|
|
104
|
|
|
79
|
|
|||
Brazil
|
1,097
|
|
|
915
|
|
|
580
|
|
|||
Mexico
|
693
|
|
|
147
|
|
|
—
|
|
|||
Total
|
$
|
9,651
|
|
|
$
|
3,896
|
|
|
$
|
1,939
|
|
Brookfield Business Partners
|
52
|
53
|
Brookfield Business Partners
|
•
|
build and operate businesses with sustainable cash flows to reduce risk and lower cost of capital;
|
•
|
utilize an active management approach focused on strategic, operational and/or financial improvements;
|
•
|
acquire businesses on a value basis; deploying contrarian thinking to target out of favor sectors; and
|
•
|
make direct acquisitions or add-on acquisitions within existing businesses and/or in sectors where we believe we possess competitive advantages.
|
•
|
the licensee defaults in the performance of any material term, condition or agreement contained in the agreement and the default continues for a period of 30 days after written notice of the breach is given to the licensee;
|
•
|
the licensee assigns, sublicenses, pledges, mortgages or otherwise encumbers the intellectual property rights granted to it pursuant to the licensing agreement;
|
•
|
certain events relating to a bankruptcy or insolvency of the licensee; or
|
•
|
the licensee ceases to be an affiliate of Brookfield.
|
Brookfield Business Partners
|
54
|
▪
|
Employee Well-Being: Meet or exceed all applicable labor laws and standards, which includes respecting human rights, offering competitive wages and implementing nondiscriminatory hiring practices.
|
▪
|
Health & Safety: Aim to have zero serious safety incidents within our businesses by working towards consistent health and safety principles across the organization.
|
▪
|
Community Engagement: Engage with community groups that might be affected to ensure that their interests, safety and well-being are appropriately integrated into decision-making.
|
▪
|
Philanthropy: Empower employees to participate in and give back to communities.
|
▪
|
Environmental Stewardship: Strive to minimize environmental impacts and improve efficient use of resources over time.
|
▪
|
Governance, Ethics and Fairness: Operate with high ethical standards by conducting business activities in compliance with applicable legal and regulatory requirements, and consistent with our Code of Business Conduct and Ethics.
|
▪
|
Transparency: Be accessible to our investors and stakeholders by being responsive to requests for information and timely in our communication.
|
55
|
Brookfield Business Partners
|
(i)
|
Code of Conduct: each company is responsible for ensuring that its existing practices are consistent with our Code of Business Conduct and Ethics.
|
(ii)
|
Anti-Bribery and Corruption Policy: each company is responsible for ensuring they have a zero-tolerance approach to bribery, including facilitation payments.
|
(iii)
|
Ethics Hotline: each company is responsible for ensuring they have a whistle-blower hotline in operation within six months of acquisition, and they take measures to ensure that every employee is aware of the existence and purpose of the hotline.
|
•
|
Approximately 7.5 million square feet of office, manufacturing and warehouse facilities in Europe and the United States related to our power generation industry service provider business;
|
•
|
Approximately 1.8 million square feet of manufacturing and warehouse facilities in Europe and the United States related to our graphite electrode manufacturing business;
|
Brookfield Business Partners
|
56
|
•
|
Approximately 17.4 million square feet of office, manufacturing and distribution facilities in Europe, the United States, Mexico and China related to our manufacturer of automotive batteries business; and
|
•
|
Approximately 5.1 million square feet of hospitals and pathology laboratories in Australia and New Zealand related to our healthcare services business.
|
(1)
|
Public holders of our units currently own approximately 69% of our units and Brookfield currently owns approximately 31% of our units. Our company’s sole direct investment is a managing general partnership interest in the Holding LP. Brookfield also owns a limited partnership interest in the Holding LP through Brookfield’s ownership of redemption-exchange units and Special LP Units. Brookfield indirectly owns 100% of the redemption-exchange units of Holding LP, which represent 46% of our units on a fully diluted basis. The redemption-exchange units are redeemable for cash or exchangeable for our units in accordance with the Redemption-Exchange Mechanism, which could result in Brookfield owning approximately 63% of our units issued and outstanding, with public holders of our units owning approximately 37% of the units of our company issued and outstanding, in each case on a fully exchanged basis. Brookfield’s interest in our company consists of a combination of our units and general partner interests, the redemption-exchange units
|
57
|
Brookfield Business Partners
|
(2)
|
The Holding LP currently owns, directly or indirectly, all of the common shares or equity interests, as applicable, of the Holding Entities. Brookfield has subscribed for $5 million of preferred shares of each of CanHoldco and two of our other subsidiaries, which preferred shares will be entitled to vote with the common shares of the applicable entity. Brookfield currently has an aggregate of 1% of the votes of each of the three entities.
|
(3)
|
Certain of the operating businesses and intermediate holding companies that are directly or indirectly owned by the Holding Entities and that directly or indirectly hold our operations are not shown on the chart. All percentages listed represent our economic interest in the applicable entity or group of assets, which may not be the same as our voting interest in those entities and groups of assets. All interests are rounded to the nearest one percent and are calculated as at the date of this Form 20-F.
|
Significant subsidiaries
|
Jurisdiction of
organization
|
|
Voting interest
|
|
Economic interest
|
||
Business services
|
|
|
|
|
|
||
Multiplex
|
United Kingdom
|
|
100
|
%
|
|
100
|
%
|
Healthscope Limited
|
Australia
|
|
100
|
%
|
|
27
|
%
|
Genworth MI Canada Inc.
|
Canada
|
|
57
|
%
|
|
29
|
%
|
Infrastructure services
|
|
|
|
|
|
|
|
Westinghouse Electric Company
|
United States
|
|
100
|
%
|
|
44
|
%
|
Teekay Offshore LP
|
Bermuda
|
|
73
|
%
|
|
31
|
%
|
Industrials
|
|
|
|
|
|
|
|
GrafTech International Ltd.
|
United States
|
|
74
|
%
|
|
25
|
%
|
Clarios Global LP
|
United States
|
|
100
|
%
|
|
28
|
%
|
Brookfield Business Partners
|
58
|
59
|
Brookfield Business Partners
|
(i)
|
Business services, including mortgage insurance services, healthcare services, road fuel distribution and marketing, real estate and construction services, entertainment, and other businesses;
|
(ii)
|
Infrastructure services, which includes a global provider of services to the power generation industry and a service provider to the offshore oil production industry;
|
(iii)
|
Industrials, including automotive batteries, graphite electrode and other manufacturing, water and wastewater services, natural gas production and well servicing, and a variety of smaller industrial operations; and
|
(iv)
|
Corporate and other, which includes corporate cash and liquidity management, and activities related to the management of the partnership’s relationship with Brookfield.
|
Operating segments
|
Assets
|
|
Revenue
|
||||
|
As at
|
|
For the year ended
|
||||
(US$ MILLIONS)
|
December 31, 2019
|
|
December 31, 2019
|
||||
Business services
|
$
|
18,132
|
|
|
$
|
28,822
|
|
Infrastructure services
|
10,619
|
|
|
4,559
|
|
||
Industrials
|
22,742
|
|
|
9,651
|
|
||
Corporate and other
|
258
|
|
|
—
|
|
||
Total
|
$
|
51,751
|
|
|
$
|
43,032
|
|
Brookfield Business Partners
|
60
|
61
|
Brookfield Business Partners
|
Brookfield Business Partners
|
62
|
63
|
Brookfield Business Partners
|
Brookfield Business Partners
|
64
|
|
|
Year Ended December 31,
|
|
Change
|
||||||||||||||||
(US$ MILLIONS, except per unit amounts)
|
|
2019
|
|
2018
|
|
2017
|
|
2019 vs 2018
|
|
2018 vs 2017
|
||||||||||
Revenues
|
|
$
|
43,032
|
|
|
$
|
37,168
|
|
|
$
|
22,823
|
|
|
$
|
5,864
|
|
|
$
|
14,345
|
|
Direct operating costs
|
|
(38,327
|
)
|
|
(34,134
|
)
|
|
(21,876
|
)
|
|
(4,193
|
)
|
|
(12,258
|
)
|
|||||
General and administrative expenses
|
|
(832
|
)
|
|
(643
|
)
|
|
(340
|
)
|
|
(189
|
)
|
|
(303
|
)
|
|||||
Depreciation and amortization expense
|
|
(1,804
|
)
|
|
(748
|
)
|
|
(371
|
)
|
|
(1,056
|
)
|
|
(377
|
)
|
|||||
Interest income (expense), net
|
|
(1,274
|
)
|
|
(498
|
)
|
|
(202
|
)
|
|
(776
|
)
|
|
(296
|
)
|
|||||
Equity accounted income, net
|
|
114
|
|
|
10
|
|
|
69
|
|
|
104
|
|
|
(59
|
)
|
|||||
Impairment expense, net
|
|
(609
|
)
|
|
(218
|
)
|
|
(39
|
)
|
|
(391
|
)
|
|
(179
|
)
|
|||||
Gain (loss) on acquisitions/dispositions, net
|
|
726
|
|
|
500
|
|
|
267
|
|
|
226
|
|
|
233
|
|
|||||
Other (expense) income, net
|
|
(400
|
)
|
|
(136
|
)
|
|
(108
|
)
|
|
(264
|
)
|
|
(28
|
)
|
|||||
Income (loss) before income tax
|
|
626
|
|
|
1,301
|
|
|
223
|
|
|
(675
|
)
|
|
1,078
|
|
|||||
Current income tax (expense) recovery
|
|
(324
|
)
|
|
(186
|
)
|
|
(30
|
)
|
|
(138
|
)
|
|
(156
|
)
|
|||||
Deferred income tax recovery (expense)
|
|
132
|
|
|
88
|
|
|
22
|
|
|
44
|
|
|
66
|
|
|||||
Net income (loss)
|
|
$
|
434
|
|
|
$
|
1,203
|
|
|
$
|
215
|
|
|
$
|
(769
|
)
|
|
$
|
988
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Limited partners
|
|
$
|
43
|
|
|
$
|
74
|
|
|
$
|
(58
|
)
|
|
$
|
(31
|
)
|
|
$
|
132
|
|
Non-controlling interests attributable to:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Redemption-Exchange Units held by Brookfield Asset Management
|
|
45
|
|
|
70
|
|
|
(60
|
)
|
|
(25
|
)
|
|
130
|
|
|||||
Special limited partners
|
|
—
|
|
|
278
|
|
|
142
|
|
|
(278
|
)
|
|
136
|
|
|||||
Interest of others
|
|
346
|
|
|
781
|
|
|
191
|
|
|
(435
|
)
|
|
590
|
|
|||||
|
|
$
|
434
|
|
|
$
|
1,203
|
|
|
$
|
215
|
|
|
$
|
(769
|
)
|
|
$
|
988
|
|
Basic and diluted earnings per limited partner unit (1) (2)
|
|
$
|
0.62
|
|
|
$
|
1.11
|
|
|
$
|
(1.04
|
)
|
|
|
|
|
(1)
|
Average number of partnership units outstanding on a fully diluted time weighted average basis, assuming the exchange of redemption exchange units held by Brookfield Asset Management for LP Units, for the year ended December 31, 2019 was 140.1 million (2018: 129.3 million, 2017: 113.5 million).
|
(2)
|
Income (loss) attributed to limited partnership units on a fully diluted basis is reduced by incentive distributions paid to special limited partnership unitholders during the years ended December 31, 2018 and December 31, 2017.
|
65
|
Brookfield Business Partners
|
Brookfield Business Partners
|
66
|
67
|
Brookfield Business Partners
|
Brookfield Business Partners
|
68
|
69
|
Brookfield Business Partners
|
(US$ MILLIONS, except per unit amounts)
|
2019
|
|
2018
|
||||||||||||||||||||||||||||
Q4
|
|
Q3
|
|
Q2
|
|
Q1
|
|
Q4
|
|
Q3
|
|
Q2
|
|
Q1
|
|||||||||||||||||
Three months ended
|
|||||||||||||||||||||||||||||||
Revenues
|
$
|
11,320
|
|
|
$
|
11,794
|
|
|
$
|
10,717
|
|
|
$
|
9,201
|
|
|
$
|
10,209
|
|
|
$
|
9,990
|
|
|
$
|
8,775
|
|
|
$
|
8,194
|
|
Direct operating costs
|
(9,969
|
)
|
|
(10,389
|
)
|
|
(9,776
|
)
|
|
(8,193
|
)
|
|
(9,205
|
)
|
|
(9,080
|
)
|
|
(8,200
|
)
|
|
(7,649
|
)
|
||||||||
General and administrative expenses
|
(228
|
)
|
|
(215
|
)
|
|
(211
|
)
|
|
(178
|
)
|
|
(209
|
)
|
|
(174
|
)
|
|
(142
|
)
|
|
(118
|
)
|
||||||||
Depreciation and amortization expense
|
(518
|
)
|
|
(534
|
)
|
|
(441
|
)
|
|
(311
|
)
|
|
(286
|
)
|
|
(251
|
)
|
|
(105
|
)
|
|
(106
|
)
|
||||||||
Interest income (expense), net
|
(388
|
)
|
|
(389
|
)
|
|
(313
|
)
|
|
(184
|
)
|
|
(181
|
)
|
|
(148
|
)
|
|
(83
|
)
|
|
(86
|
)
|
||||||||
Equity accounted income (loss), net
|
52
|
|
|
32
|
|
|
23
|
|
|
7
|
|
|
9
|
|
|
(9
|
)
|
|
(7
|
)
|
|
17
|
|
||||||||
Impairment expense, net
|
(285
|
)
|
|
—
|
|
|
(324
|
)
|
|
—
|
|
|
(38
|
)
|
|
(180
|
)
|
|
—
|
|
|
—
|
|
||||||||
Gain (loss) on acquisitions/dispositions, net
|
190
|
|
|
16
|
|
|
522
|
|
|
(2
|
)
|
|
147
|
|
|
247
|
|
|
90
|
|
|
16
|
|
||||||||
Other income (expense), net
|
(46
|
)
|
|
(83
|
)
|
|
(181
|
)
|
|
(90
|
)
|
|
(73
|
)
|
|
(42
|
)
|
|
(7
|
)
|
|
(14
|
)
|
||||||||
Income (loss) before income tax
|
128
|
|
|
232
|
|
|
16
|
|
|
250
|
|
|
373
|
|
|
353
|
|
|
321
|
|
|
254
|
|
||||||||
Current income tax (expense)/recovery
|
(93
|
)
|
|
(108
|
)
|
|
(93
|
)
|
|
(30
|
)
|
|
(63
|
)
|
|
(43
|
)
|
|
(52
|
)
|
|
(28
|
)
|
||||||||
Deferred income tax (expense)/recovery
|
52
|
|
|
58
|
|
|
41
|
|
|
(19
|
)
|
|
84
|
|
|
(25
|
)
|
|
39
|
|
|
(10
|
)
|
||||||||
Net income (loss)
|
$
|
87
|
|
|
$
|
182
|
|
|
$
|
(36
|
)
|
|
$
|
201
|
|
|
$
|
394
|
|
|
$
|
285
|
|
|
$
|
308
|
|
|
$
|
216
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Limited partners
|
$
|
(57
|
)
|
|
$
|
13
|
|
|
$
|
55
|
|
|
$
|
32
|
|
|
$
|
70
|
|
|
$
|
(1
|
)
|
|
$
|
40
|
|
|
$
|
(35
|
)
|
Non-controlling interests attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Redemption-Exchange Units held Brookfield Asset Management Inc.
|
(48
|
)
|
|
11
|
|
|
52
|
|
|
30
|
|
|
66
|
|
|
—
|
|
|
38
|
|
|
(34
|
)
|
||||||||
Special Limited Partners
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
94
|
|
|
41
|
|
|
143
|
|
||||||||
Interest of others
|
192
|
|
|
158
|
|
|
(143
|
)
|
|
139
|
|
|
258
|
|
|
192
|
|
|
189
|
|
|
142
|
|
||||||||
Net income (loss)
|
$
|
87
|
|
|
$
|
182
|
|
|
$
|
(36
|
)
|
|
$
|
201
|
|
|
$
|
394
|
|
|
$
|
285
|
|
|
$
|
308
|
|
|
$
|
216
|
|
Basic and diluted earnings (loss) per limited partner unit (1) (2)
|
$
|
(0.70
|
)
|
|
$
|
0.16
|
|
|
$
|
0.82
|
|
|
$
|
0.48
|
|
|
$
|
1.04
|
|
|
$
|
—
|
|
|
$
|
0.60
|
|
|
$
|
(0.53
|
)
|
(1)
|
Average number of partnership units outstanding on a fully diluted time weighted average basis, assuming the exchange of redemption-exchange units held by Brookfield Asset Management for LP Units, for the three months ended December 31, 2019 was 150.6 million and for the three months ended December 31, 2018 was 129.3 million.
|
(2)
|
Income (loss) attributed to LP Units on a fully diluted basis is reduced by incentive distributions paid to special limited partnership unitholders during the three months ended March 31, 2018, June 30, 2018, and September 30, 2018.
|
Brookfield Business Partners
|
70
|
|
|
|
|
|
|
Change
|
||||||
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
|
December 2019 vs December 2018
|
||||||
Assets
|
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
|
$
|
1,986
|
|
|
$
|
1,949
|
|
|
$
|
37
|
|
Financial assets
|
|
6,243
|
|
|
1,369
|
|
|
4,874
|
|
|||
Accounts receivable, net
|
|
5,631
|
|
|
5,160
|
|
|
471
|
|
|||
Inventory and other assets
|
|
5,282
|
|
|
3,138
|
|
|
2,144
|
|
|||
Property, plant and equipment
|
|
13,892
|
|
|
6,947
|
|
|
6,945
|
|
|||
Deferred income tax assets
|
|
667
|
|
|
280
|
|
|
387
|
|
|||
Intangible assets
|
|
11,559
|
|
|
5,523
|
|
|
6,036
|
|
|||
Equity accounted investments
|
|
1,273
|
|
|
541
|
|
|
732
|
|
|||
Goodwill
|
|
5,218
|
|
|
2,411
|
|
|
2,807
|
|
|||
Total assets
|
|
$
|
51,751
|
|
|
$
|
27,318
|
|
|
$
|
24,433
|
|
Liabilities and equity in net assets
|
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
|
||||||
Accounts payable and other
|
|
$
|
16,496
|
|
|
$
|
9,091
|
|
|
$
|
7,405
|
|
Corporate borrowings
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Non-recourse borrowings in subsidiaries of Brookfield Business Partners
|
|
22,399
|
|
|
10,866
|
|
|
11,533
|
|
|||
Deferred income tax liabilities
|
|
1,803
|
|
|
867
|
|
|
936
|
|
|||
|
|
$
|
40,698
|
|
|
$
|
20,824
|
|
|
$
|
19,874
|
|
Equity
|
|
|
|
|
|
|
||||||
Limited partners
|
|
$
|
2,116
|
|
|
$
|
1,548
|
|
|
$
|
568
|
|
Non-controlling interests attributable to:
|
|
|
|
|
|
|
||||||
Redemption-Exchange Units, Preferred Shares and Special Limited Partnership Units held by Brookfield Asset Management Inc.
|
|
1,676
|
|
|
1,415
|
|
|
261
|
|
|||
Interest of others in operating subsidiaries
|
|
7,261
|
|
|
3,531
|
|
|
3,730
|
|
|||
|
|
11,053
|
|
|
6,494
|
|
|
4,559
|
|
|||
Total liabilities and equity
|
|
$
|
51,751
|
|
|
$
|
27,318
|
|
|
$
|
24,433
|
|
(US$ MILLIONS)
|
|
Business
services
|
|
Infrastructure
services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
December 31, 2019
|
|
$
|
5,407
|
|
|
$
|
338
|
|
|
$
|
324
|
|
|
$
|
174
|
|
|
$
|
6,243
|
|
December 31, 2018
|
|
$
|
623
|
|
|
$
|
360
|
|
|
$
|
333
|
|
|
$
|
53
|
|
|
$
|
1,369
|
|
71
|
Brookfield Business Partners
|
Brookfield Business Partners
|
72
|
UNITS
|
|
December 31, 2019
|
|
December 31, 2018
|
||
GP Units
|
|
4
|
|
|
4
|
|
LP Units
|
|
80,890,655
|
|
|
66,185,798
|
|
Non-controlling interests:
|
|
|
|
|
||
Redemption-Exchange Units, held by Brookfield
|
|
69,705,497
|
|
|
63,095,497
|
|
Special LP Units
|
|
4
|
|
|
4
|
|
73
|
Brookfield Business Partners
|
|
|
Year Ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
$
|
43,032
|
|
|
$
|
37,168
|
|
|
$
|
22,823
|
|
Direct operating costs
|
|
(38,327
|
)
|
|
(34,134
|
)
|
|
(21,876
|
)
|
|||
General and administrative expenses
|
|
(832
|
)
|
|
(643
|
)
|
|
(340
|
)
|
|||
Equity accounted Company EBITDA
|
|
241
|
|
|
196
|
|
|
108
|
|
|||
Company EBITDA attributable to others (1)
|
|
(2,901
|
)
|
|
(1,744
|
)
|
|
(475
|
)
|
|||
Company EBITDA (2)
|
|
$
|
1,213
|
|
|
$
|
843
|
|
|
$
|
240
|
|
Realized disposition gains (losses), net
|
|
726
|
|
|
250
|
|
|
244
|
|
|||
Other income (expense), net
|
|
(25
|
)
|
|
(18
|
)
|
|
—
|
|
|||
Interest income (expense), net
|
|
(1,274
|
)
|
|
(498
|
)
|
|
(202
|
)
|
|||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments
|
|
(42
|
)
|
|
(54
|
)
|
|
(17
|
)
|
|||
Current income taxes
|
|
(324
|
)
|
|
(186
|
)
|
|
(30
|
)
|
|||
Company FFO attributable to others (net of Company EBITDA attributable to others) (1)
|
|
828
|
|
|
396
|
|
|
17
|
|
|||
Company FFO (2)
|
|
$
|
1,102
|
|
|
$
|
733
|
|
|
$
|
252
|
|
(1)
|
Attributable to interests of others in our operating subsidiaries.
|
(2)
|
Company FFO and Company EBITDA are non-IFRS measures. Company FFO is calculated as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, non-cash gains or losses as appropriate and other items. When determining Company FFO, we include our proportionate share of Company FFO of equity accounted investments. Company FFO is further adjusted as Company EBITDA to exclude the impact of realized disposition gains (losses), interest income (expense), current income taxes, the impact of realized disposition gains (losses), current income taxes and interest income (expense) related to equity accounted investments and other items. Company EBITDA and Company FFO are presented net to unitholders. For further information on Company FFO and Company EBITDA see the “Reconciliation of Non-IFRS Measures” section of the MD&A.
|
Brookfield Business Partners
|
74
|
|
|
Year Ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
$
|
28,822
|
|
|
$
|
30,847
|
|
|
$
|
20,874
|
|
Direct operating costs
|
|
(27,995
|
)
|
|
(30,351
|
)
|
|
(20,448
|
)
|
|||
General and administrative expenses
|
|
(314
|
)
|
|
(278
|
)
|
|
(182
|
)
|
|||
Equity accounted Company EBITDA
|
|
38
|
|
|
34
|
|
|
28
|
|
|||
Company EBITDA attributable to others (1)
|
|
(330
|
)
|
|
(124
|
)
|
|
(169
|
)
|
|||
Company EBITDA (2)
|
|
$
|
221
|
|
|
$
|
128
|
|
|
$
|
103
|
|
Realized disposition gains (losses), net
|
|
528
|
|
|
55
|
|
|
19
|
|
|||
Interest income (expense), net
|
|
(189
|
)
|
|
(66
|
)
|
|
(47
|
)
|
|||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments
|
|
(7
|
)
|
|
(3
|
)
|
|
—
|
|
|||
Current income taxes
|
|
(91
|
)
|
|
(44
|
)
|
|
(16
|
)
|
|||
Company FFO attributable to others (net of Company EBITDA attributable to others) (1)
|
|
(30
|
)
|
|
61
|
|
|
33
|
|
|||
Company FFO (2)
|
|
$
|
432
|
|
|
$
|
131
|
|
|
$
|
92
|
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||
Total assets
|
|
$
|
18,132
|
|
|
$
|
7,613
|
|
|
$
|
7,899
|
|
Total liabilities
|
|
$
|
12,646
|
|
|
$
|
5,549
|
|
|
$
|
5,930
|
|
Interests of others in operating subsidiaries (1)
|
|
$
|
3,325
|
|
|
$
|
571
|
|
|
$
|
562
|
|
Equity attributable to unitholders
|
|
2,161
|
|
|
1,493
|
|
|
1,407
|
|
|||
Total equity
|
|
$
|
5,486
|
|
|
$
|
2,064
|
|
|
$
|
1,969
|
|
(1)
|
Attributable to interests of others in our operating subsidiaries.
|
75
|
Brookfield Business Partners
|
(2)
|
Company FFO and Company EBITDA are non-IFRS measures. Company FFO is calculated as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, non-cash gains or losses as appropriate and other items. When determining Company FFO, we include our proportionate share of Company FFO of equity accounted investments. Company FFO is further adjusted as Company EBITDA to exclude the impact of realized disposition gains (losses), interest income (expense), current income taxes, the impact of realized disposition gains (losses), current income taxes and interest income (expense) related to equity accounted investments and other items. Company EBITDA and Company FFO are presented net to unitholders. For further information on Company FFO and Company EBITDA see the “Reconciliation of Non-IFRS Measures” section of the MD&A.
|
Brookfield Business Partners
|
76
|
|
|
Year Ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
$
|
4,559
|
|
|
$
|
2,418
|
|
|
$
|
3
|
|
Direct operating costs
|
|
(3,231
|
)
|
|
(1,715
|
)
|
|
—
|
|
|||
General and administrative expenses
|
|
(133
|
)
|
|
(65
|
)
|
|
—
|
|
|||
Equity accounted Company EBITDA
|
|
109
|
|
|
120
|
|
|
31
|
|
|||
Company EBITDA attributable to others (1)
|
|
(836
|
)
|
|
(463
|
)
|
|
—
|
|
|||
Company EBITDA (2)
|
|
$
|
468
|
|
|
$
|
295
|
|
|
$
|
34
|
|
Realized disposition gains, net
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||
Other income (expense), net
|
|
(27
|
)
|
|
(15
|
)
|
|
—
|
|
|||
Interest income (expense), net
|
|
(381
|
)
|
|
(176
|
)
|
|
—
|
|
|||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments
|
|
(15
|
)
|
|
(41
|
)
|
|
(13
|
)
|
|||
Current income taxes
|
|
(4
|
)
|
|
(10
|
)
|
|
—
|
|
|||
Company FFO attributable to others (net of Company EBITDA attributable to others) (1)
|
|
274
|
|
|
142
|
|
|
—
|
|
|||
Company FFO (2)
|
|
$
|
314
|
|
|
$
|
195
|
|
|
$
|
21
|
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||
Total assets
|
|
$
|
10,619
|
|
|
$
|
11,640
|
|
|
$
|
306
|
|
Total liabilities
|
|
$
|
9,316
|
|
|
$
|
9,129
|
|
|
$
|
4
|
|
Interests of others in operating subsidiaries (1)
|
|
$
|
833
|
|
|
$
|
1,534
|
|
|
$
|
—
|
|
Equity attributable to unitholders
|
|
470
|
|
|
977
|
|
|
302
|
|
|||
Total equity
|
|
$
|
1,303
|
|
|
$
|
2,511
|
|
|
$
|
302
|
|
(1)
|
Attributable to interests of others in our operating subsidiaries.
|
(2)
|
Company FFO and Company EBITDA are non-IFRS measures. Company FFO is calculated as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, non-cash gains or losses as appropriate and other items. When determining Company FFO, we include our proportionate share of Company FFO of equity accounted investments. Company FFO is further adjusted as Company EBITDA to exclude the impact of realized disposition gains (losses), interest income (expense), current income taxes, the impact of realized disposition gains (losses), current income taxes and interest income (expense) related to equity accounted investments and other items. Company EBITDA and Company FFO are presented net to unitholders. For further information on Company FFO and Company EBITDA see the “Reconciliation of Non-IFRS Measures” section of the MD&A.
|
77
|
Brookfield Business Partners
|
|
|
Year Ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
$
|
9,651
|
|
|
$
|
3,896
|
|
|
$
|
1,939
|
|
Direct operating costs
|
|
(7,092
|
)
|
|
(2,060
|
)
|
|
(1,425
|
)
|
|||
General and administrative expenses
|
|
(299
|
)
|
|
(231
|
)
|
|
(113
|
)
|
|||
Equity accounted Company EBITDA
|
|
94
|
|
|
42
|
|
|
49
|
|
|||
Company EBITDA attributable to others (1)
|
|
(1,735
|
)
|
|
(1,157
|
)
|
|
(306
|
)
|
|||
Company EBITDA (2)
|
|
$
|
619
|
|
|
$
|
490
|
|
|
$
|
144
|
|
Realized disposition gains, net
|
|
200
|
|
|
195
|
|
|
225
|
|
|||
Other income (expense), net
|
|
2
|
|
|
(3
|
)
|
|
—
|
|
|||
Interest income (expense), net
|
|
(741
|
)
|
|
(263
|
)
|
|
(154
|
)
|
|||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments
|
|
(20
|
)
|
|
(10
|
)
|
|
(4
|
)
|
|||
Current income taxes
|
|
(251
|
)
|
|
(132
|
)
|
|
(32
|
)
|
|||
Company FFO attributable to others (net of Company EBITDA attributable to others) (1)
|
|
584
|
|
|
193
|
|
|
(16
|
)
|
|||
Company FFO (2)
|
|
$
|
393
|
|
|
$
|
470
|
|
|
$
|
163
|
|
Brookfield Business Partners
|
78
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||
Total assets
|
|
$
|
22,742
|
|
|
$
|
7,650
|
|
|
$
|
7,204
|
|
Total liabilities
|
|
$
|
18,692
|
|
|
$
|
5,865
|
|
|
$
|
3,721
|
|
Interests of others in operating subsidiaries (1)
|
|
$
|
3,103
|
|
|
$
|
1,426
|
|
|
$
|
2,464
|
|
Equity attributable to unitholders
|
|
947
|
|
|
359
|
|
|
1,019
|
|
|||
Total equity
|
|
$
|
4,050
|
|
|
$
|
1,785
|
|
|
$
|
3,483
|
|
(1)
|
Attributable to interests of others in our operating subsidiaries.
|
(2)
|
Company FFO and Company EBITDA are non-IFRS measures. Company FFO is calculated as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, non-cash gains or losses as appropriate and other items. When determining Company FFO, we include our proportionate share of Company FFO of equity accounted investments. Company FFO is further adjusted as Company EBITDA to exclude the impact of realized disposition gains (losses), interest income (expense), current income taxes, the impact of realized disposition gains (losses), current income taxes and interest income (expense) related to equity accounted investments and other items. Company EBITDA and Company FFO are presented net to unitholders. For further information on Company FFO and Company EBITDA see the “Reconciliation of Non-IFRS Measures” section of the MD&A.
|
79
|
Brookfield Business Partners
|
|
|
Year Ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
7
|
|
Direct operating costs
|
|
(9
|
)
|
|
(8
|
)
|
|
(3
|
)
|
|||
General and administrative expenses
|
|
(86
|
)
|
|
(69
|
)
|
|
(45
|
)
|
|||
Company EBITDA (2)
|
|
$
|
(95
|
)
|
|
$
|
(70
|
)
|
|
$
|
(41
|
)
|
Realized disposition gains, net
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||
Interest income (expense), net
|
|
37
|
|
|
7
|
|
|
(1
|
)
|
|||
Current income taxes
|
|
22
|
|
|
—
|
|
|
18
|
|
|||
Company FFO (2)
|
|
$
|
(37
|
)
|
|
$
|
(63
|
)
|
|
$
|
(24
|
)
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||
Total assets
|
|
$
|
258
|
|
|
$
|
415
|
|
|
$
|
395
|
|
Total liabilities
|
|
$
|
44
|
|
|
$
|
281
|
|
|
$
|
85
|
|
Interests of others in operating subsidiaries (1)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Equity attributable to unitholders
|
|
214
|
|
|
134
|
|
|
310
|
|
|||
Total equity
|
|
$
|
214
|
|
|
$
|
134
|
|
|
$
|
310
|
|
(1)
|
Attributable to interests of others in our operating subsidiaries.
|
(2)
|
Company FFO and Company EBITDA are non-IFRS measures. Company FFO is calculated as net income excluding the impact of depreciation and amortization, deferred income taxes, breakage and transaction costs, non-cash gains or losses as appropriate and other items. When determining Company FFO, we include our proportionate share of Company FFO of equity accounted investments. Company FFO is further adjusted as Company EBITDA to exclude the impact of realized disposition gains (losses), interest income (expense), current income taxes, the impact of realized disposition gains (losses), current income taxes and interest income (expense) related to equity accounted investments and other items. Company EBITDA and Company FFO are presented net to unitholders. For further information on Company FFO and Company EBITDA see the “Reconciliation of Non-IFRS Measures” section of the MD&A.
|
Brookfield Business Partners
|
80
|
•
|
Company FFO does not include depreciation and amortization expense; because we own capital assets with finite lives, depreciation and amortization expense recognizes the fact that we must maintain or replace our asset base in order to preserve our revenue generating capability;
|
•
|
Company FFO does not include deferred income taxes, which may become payable if we own our assets for a long period of time; and
|
•
|
Company FFO does not include any non-cash fair value adjustments or mark-to-market adjustments recorded to net income unless the underlying movement in the item being hedged is recorded within Company FFO.
|
81
|
Brookfield Business Partners
|
|
|
Year Ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
$
|
43,032
|
|
|
$
|
37,168
|
|
|
$
|
22,823
|
|
Direct operating costs
|
|
(38,327
|
)
|
|
(34,134
|
)
|
|
(21,876
|
)
|
|||
General and administrative expenses
|
|
(832
|
)
|
|
(643
|
)
|
|
(340
|
)
|
|||
Equity accounted investment Company EBITDA (1)
|
|
241
|
|
|
196
|
|
|
108
|
|
|||
Company EBITDA attributable to others (2)
|
|
(2,901
|
)
|
|
(1,744
|
)
|
|
(475
|
)
|
|||
Company EBITDA
|
|
$
|
1,213
|
|
|
$
|
843
|
|
|
$
|
240
|
|
Realized disposition gain (loss), net (3)
|
|
726
|
|
|
250
|
|
|
244
|
|
|||
Other income (expense), net
|
|
(25
|
)
|
|
(18
|
)
|
|
—
|
|
|||
Interest income (expense), net
|
|
(1,274
|
)
|
|
(498
|
)
|
|
(202
|
)
|
|||
Equity accounted current taxes and interest (1)
|
|
(42
|
)
|
|
(54
|
)
|
|
(17
|
)
|
|||
Current income taxes
|
|
(324
|
)
|
|
(186
|
)
|
|
(30
|
)
|
|||
Company FFO attributable to others (2)
|
|
828
|
|
|
396
|
|
|
17
|
|
|||
Company FFO
|
|
$
|
1,102
|
|
|
$
|
733
|
|
|
$
|
252
|
|
Depreciation and amortization
|
|
(1,804
|
)
|
|
(748
|
)
|
|
(371
|
)
|
|||
Realized disposition gain/(loss) recorded in prior periods (3)
|
|
—
|
|
|
—
|
|
|
23
|
|
|||
Impairment expense, net
|
|
(609
|
)
|
|
(218
|
)
|
|
(39
|
)
|
|||
Gain on acquisition and disposition (3)
|
|
—
|
|
|
250
|
|
|
—
|
|
|||
Other income (expenses), net
|
|
(375
|
)
|
|
(118
|
)
|
|
(108
|
)
|
|||
Deferred income taxes
|
|
132
|
|
|
88
|
|
|
22
|
|
|||
Non-cash items attributable to equity accounted investments (1)
|
|
(85
|
)
|
|
(132
|
)
|
|
(22
|
)
|
|||
Non-cash items attributable to others (2)
|
|
1,727
|
|
|
567
|
|
|
267
|
|
|||
Net income attributable to unitholders
|
|
$
|
88
|
|
|
$
|
422
|
|
|
$
|
24
|
|
(1)
|
The sum of these amounts equates to equity accounted income of $114 million, as per our IFRS statement of operating results for year ended December 31, 2019, equity accounted income of $10 million for the year ended December 31, 2018 and equity accounted income of $69 million for the year ended December 31, 2017.
|
(2)
|
Total cash and non-cash items attributable to the interest of others equals net income of $346 million, as per our IFRS statement of operating results for year ended December 31, 2019, net income of $781 million for the year ended December 31, 2018 and net income of $191 million for the year ended December 31, 2017.
|
(3)
|
The sum of these amounts equates to net realized disposition gain of $726 million, as per our IFRS statement of operating results for year ended December 31, 2019, net realized disposition gain of $500 million for the year ended December 31, 2018 and net realized disposition gain of $267 million for the year ended December 31, 2017.
|
|
|
Years ended December 31
|
||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Limited partners
|
|
$
|
2,116
|
|
|
$
|
1,548
|
|
General partner
|
|
—
|
|
|
—
|
|
||
Non-controlling interests attributable to:
|
|
|
|
|
|
|
||
Redemption-Exchange Units, Preferred Shares and Special LP Units held by Brookfield
|
|
1,676
|
|
|
1,415
|
|
||
Equity attributable to unitholders
|
|
$
|
3,792
|
|
|
$
|
2,963
|
|
Brookfield Business Partners
|
82
|
(US$ MILLIONS)
|
|
Business
services
|
|
Infrastructure
services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
December 31, 2019
|
|
$
|
2,161
|
|
|
$
|
470
|
|
|
$
|
947
|
|
|
$
|
214
|
|
|
$
|
3,792
|
|
December 31, 2018
|
|
$
|
1,493
|
|
|
$
|
977
|
|
|
$
|
359
|
|
|
$
|
134
|
|
|
$
|
2,963
|
|
(US$ MILLIONS)
|
|
Business
services
|
|
Infrastructure
services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
December 31, 2019
|
|
$
|
2,621
|
|
|
$
|
5,860
|
|
|
$
|
13,918
|
|
|
$
|
—
|
|
|
$
|
22,399
|
|
December 31, 2018
|
|
$
|
1,228
|
|
|
$
|
5,748
|
|
|
$
|
3,890
|
|
|
$
|
—
|
|
|
$
|
10,866
|
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Term loans and credit facilities
|
|
$
|
15,965
|
|
|
$
|
8,505
|
|
Project financing
|
|
559
|
|
|
573
|
|
||
Securitization program
|
|
—
|
|
|
260
|
|
||
Notes and debentures
|
|
5,875
|
|
|
1,528
|
|
||
Total borrowings
|
|
$
|
22,399
|
|
|
$
|
10,866
|
|
83
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Corporate borrowings
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-recourse borrowings in subsidiaries of the partnership
|
|
$
|
22,399
|
|
|
$
|
10,866
|
|
Cash and cash equivalents
|
|
(1,986
|
)
|
|
(1,949
|
)
|
||
Net debt
|
|
20,413
|
|
|
8,917
|
|
||
Total equity
|
|
11,053
|
|
|
6,494
|
|
||
Total capital and net debt
|
|
$
|
31,466
|
|
|
$
|
15,411
|
|
Net debt to capitalization ratio
|
|
65
|
%
|
|
58
|
%
|
Brookfield Business Partners
|
84
|
|
|
Year ended December 31,
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Cash flows provided by operating activities
|
|
$
|
2,163
|
|
|
$
|
1,341
|
|
|
$
|
(70
|
)
|
Cash flows provided by (used in) investing activities
|
|
(17,939
|
)
|
|
(3,999
|
)
|
|
(1,595
|
)
|
|||
Cash flows provided by (used in) financing activities
|
|
15,925
|
|
|
3,561
|
|
|
1,713
|
|
|||
Effect of foreign exchange rates on cash
|
|
(10
|
)
|
|
(60
|
)
|
|
8
|
|
|||
Cash reclassified as held for sale
|
|
(102
|
)
|
|
—
|
|
|
—
|
|
|||
|
|
$
|
37
|
|
|
$
|
843
|
|
|
$
|
56
|
|
85
|
Brookfield Business Partners
|
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||||||||
(US$ MILLIONS)
|
|
OCI
|
|
Net income
|
|
OCI
|
|
Net income
|
|
OCI
|
|
Net income
|
||||||||||||
USD/AUD
|
|
$
|
44
|
|
|
$
|
(2
|
)
|
|
$
|
36
|
|
|
$
|
—
|
|
|
$
|
88
|
|
|
$
|
—
|
|
USD/BRL
|
|
44
|
|
|
1
|
|
|
35
|
|
|
4
|
|
|
37
|
|
|
—
|
|
||||||
USD/CDN
|
|
60
|
|
|
(1
|
)
|
|
12
|
|
|
3
|
|
|
33
|
|
|
—
|
|
||||||
USD/Other
|
|
133
|
|
|
36
|
|
|
19
|
|
|
5
|
|
|
9
|
|
|
(20
|
)
|
Brookfield Business Partners
|
86
|
87
|
Brookfield Business Partners
|
Brookfield Business Partners
|
88
|
•
|
a current, unbiased probability-weighted estimate of future cash flows expected to arise as the insurer fulfills the contract;
|
•
|
the effect of the time value of money;
|
•
|
a risk adjustment that measures the effects of uncertainty about the amount and timing of future cash flows; and
|
•
|
a contractual service margin which represents the unearned profit in a contract and that is recognized in profit or loss over time as the insurance coverage is provided.
|
89
|
Brookfield Business Partners
|
Brookfield Business Partners
|
90
|
|
|
Net investment hedges
|
||||||||||||||||||||||||||
(US$ MILLIONS)
|
|
USD
|
|
CAD
|
|
AUD
|
|
BRL
|
|
GBP
|
|
EUR
|
|
Other
|
||||||||||||||
Net Equity
|
|
$
|
(332
|
)
|
|
$
|
1,230
|
|
|
$
|
510
|
|
|
$
|
444
|
|
|
$
|
870
|
|
|
$
|
318
|
|
|
$
|
752
|
|
Foreign Currency Hedges — US$
|
|
1,218
|
|
|
(763
|
)
|
|
(135
|
)
|
|
—
|
|
|
(181
|
)
|
|
(104
|
)
|
|
(35
|
)
|
|
|
Payments as at December 31, 2019
|
||||||||||||||||||
(US$ MILLIONS)
|
|
Total
|
|
Less than
one year
|
|
One-two
years
|
|
Three-five
years
|
|
Thereafter
|
||||||||||
Borrowings
|
|
$
|
22,438
|
|
|
$
|
1,167
|
|
|
$
|
819
|
|
|
$
|
5,102
|
|
|
$
|
15,350
|
|
Lease liabilities
|
|
1,377
|
|
|
229
|
|
|
152
|
|
|
393
|
|
|
603
|
|
|||||
Interest expense
|
|
5,642
|
|
|
1,017
|
|
|
967
|
|
|
2,611
|
|
|
1,047
|
|
|||||
Decommissioning liabilities
|
|
1,184
|
|
|
5
|
|
|
3
|
|
|
46
|
|
|
1,130
|
|
|||||
Pension obligations
|
|
1,503
|
|
|
127
|
|
|
133
|
|
|
419
|
|
|
824
|
|
|||||
Obligations under agreements
|
|
975
|
|
|
605
|
|
|
129
|
|
|
137
|
|
|
104
|
|
|||||
Total
|
|
$
|
33,119
|
|
|
$
|
3,150
|
|
|
$
|
2,203
|
|
|
$
|
8,708
|
|
|
$
|
19,058
|
|
91
|
Brookfield Business Partners
|
(1)
|
The mailing addresses for the directors are set forth under “Security Ownership”.
|
(2)
|
Member of the governance and nominating committee.
|
(3)
|
Member of the audit committee.
|
(4)
|
Chair of the governance and nominating committee.
|
(5)
|
Chair of the audit committee.
|
Brookfield Business Partners
|
92
|
93
|
Brookfield Business Partners
|
Name
|
|
Age
|
|
Years of
Experience
|
|
Years at
Brookfield
|
|
Position with one of the Service Providers
|
|||
Cyrus Madon
|
|
54
|
|
|
31
|
|
|
21
|
|
|
Chief Executive Officer
|
Jaspreet Dehl
|
|
43
|
|
|
21
|
|
|
9
|
|
|
Chief Financial Officer
|
Brookfield Business Partners
|
94
|
•
|
the dissolution of our company;
|
•
|
any material amendment to our Master Services Agreement, our Limited Partnership Agreement or the Holding LP Limited Partnership Agreement;
|
•
|
any material service agreement or other arrangement pursuant to which Brookfield will be paid a fee, or other consideration other than any agreement or arrangement contemplated by our Master Services Agreement;
|
•
|
co-investments by us with Brookfield;
|
•
|
acquisitions by us from, and dispositions by us to, Brookfield;
|
•
|
any other material transaction involving us and Brookfield; and
|
•
|
termination of, or any determinations regarding indemnification under, our Master Services Agreement.
|
95
|
Brookfield Business Partners
|
•
|
our accounting and financial reporting processes;
|
•
|
the integrity and audits of our financial statements;
|
•
|
our compliance with legal and regulatory requirements; and
|
•
|
the qualifications, performance and independence of our independent accountants.
|
Brookfield Business Partners
|
96
|
97
|
Brookfield Business Partners
|
Brookfield Business Partners
|
98
|
99
|
Brookfield Business Partners
|
|
|
Units Outstanding
|
|
|
||||
Name and Address
|
|
Units Owned
|
|
Percentage
|
|
|
||
Brookfield Asset Management Inc.
|
|
|
|
|
|
|
||
Suite 300, Brookfield Place, 181 Bay Street
|
|
|
|
|
|
|
||
Toronto, Ontario M5J 2T3
|
|
94,489,751
|
|
|
62.7
|
%
|
|
(1)
|
Partners Limited
|
|
|
|
|
|
|
||
Suite 400, 51 Yonge Street
|
|
|
|
|
|
|
||
Toronto, Ontario M5E 1J1
|
|
96,002,569
|
|
|
63.7
|
%
|
|
(2)
|
(1)
|
Consists of 24,784,250 units in Brookfield Business Partners L.P. and 69,705,497 redemption-exchange units and 4 special LP units in Brookfield Business L.P. In addition, Brookfield has an indirect general partnership interest in the BBU General Partner. See also the information contained in this Form 20-F under Item 10.B., “Memorandum and Articles of Association-Description of our Units and our Limited Partnership Agreement”.
|
(2)
|
Partners Limited is a corporation whose principal business mandate is to hold shares of Brookfield, directly or indirectly, for the long-term. Partners Limited owns all of Brookfield’s Class B Limited Voting Shares entitling it to appoint one-half of the Board of Directors of Brookfield. In addition, Partners Limited owns 49% of the general partner units of Partners Value Investments LP, a publicly traded partnership on the TSX Venture Exchange that owns approximately 9% of Brookfield’s Class A Limited Voting Shares and a 9% common equity interest in Brookfield. Partners Limited may be deemed to be the beneficial owner of 96,002,569 of our units, constituting approximately 63.7% of the issued and outstanding units, assuming that all of the redemption-exchange units are exchanged for our units pursuant to the Redemption-Exchange Mechanism described in Item 10.B “Description of the Holding LP Limited Partnership Agreement-Redemption-Exchange Mechanism.” This amount includes 1,495,469 of our units beneficially held by Partners Value Investments LP. Partners Limited may be deemed to have the power (together with each of Brookfield and Partners Value Investments LP) to vote or direct the vote of the units beneficially owned by it or to dispose of such units other than 17,349 of our units with respect to which Partners Limited has sole voting and investment power.
|
Brookfield Business Partners
|
100
|
•
|
providing overall strategic advice to the applicable Service Recipients including advising with respect to the expansion of their business into new markets;
|
•
|
identifying, evaluating and recommending to the Service Recipients acquisitions or dispositions from time to time and, where requested to do so, assisting in negotiating the terms of such acquisitions or dispositions;
|
•
|
recommending and, where requested to do so, assisting in the raising of funds whether by way of debt, equity or otherwise, including the preparation, review or distribution of any prospectus or offering memorandum in respect thereof and assisting with communications support in connection therewith;
|
•
|
recommending to the Service Recipients suitable candidates to serve on the boards of directors or their equivalent governing bodies of the operating businesses;
|
•
|
making recommendations with respect to the exercise of any voting rights to which the Service Recipients are entitled in respect of the operating businesses;
|
•
|
making recommendations with respect to the payment of dividends or other distributions by the Service Recipients, including distributions by our company to our unitholders;
|
101
|
Brookfield Business Partners
|
•
|
monitoring and/or oversight of the applicable Service Recipient’s accountants, legal counsel and other accounting, financial or legal advisors and technical, commercial, marketing and other independent experts, including making recommendations with respect to, and supervising the making of all tax elections, determinations and designations, the timely calculation and payment of taxes payable and the filing of all tax returns due, by each Service Recipient, and overseeing the preparation of the Service Recipients’ annual consolidated financial statements and quarterly interim financial statements;
|
•
|
making recommendations in relation to and effecting, when requested to do so, the entry into insurance of each Service Recipient’s assets, together with other insurances against other risks, including directors and officers insurance as the relevant Service Provider and the relevant board of directors or its equivalent governing body may from time to time agree;
|
•
|
arranging for individuals to carry out the functions of principal executive, accounting and financial officers for our company only for purposes of applicable securities laws; and
|
•
|
providing individuals to act as senior officers of the Service Recipients as agreed from time to time, subject to the approval of the relevant board of directors or its equivalent governing body.
|
Brookfield Business Partners
|
102
|
•
|
any of the Service Providers defaults in the performance or observance of any material term, condition or covenant contained in the agreement in a manner that results in material harm to the Service Recipients and the default continues unremedied for a period of 30 days after written notice of the breach is given to such Service Provider;
|
•
|
any of the Service Providers engages in any act of fraud, misappropriation of funds or embezzlement against any Service Recipient that results in material harm to the Service Recipients;
|
•
|
any of the Service Providers is grossly negligent in the performance of its obligations under the agreement and such gross negligence results in material harm to the Service Recipients; or
|
•
|
certain events relating to the bankruptcy or insolvency of each of the Service Providers.
|
103
|
Brookfield Business Partners
|
Brookfield Business Partners
|
104
|
105
|
Brookfield Business Partners
|
Brookfield Business Partners
|
106
|
107
|
Brookfield Business Partners
|
•
|
Allocation of investment opportunities. In recommending acquisition opportunities, Brookfield has significant discretion to determine the suitability and/or appropriateness of opportunities for us and to allocate such opportunities among us, Brookfield, Brookfield Accounts, and/or third parties as it deems appropriate in its sole discretion. Brookfield and Brookfield Accounts have (and future Brookfield Accounts may in the future have) investment mandates that overlap with our investment mandate, including Brookfield Accounts that invest in business services, industrial operations and related assets, and in which we generally expect to be a significant investor. In addition, Brookfield has provided, and will in the future provide (without notice to our unitholders), priority rights with respect to certain investment opportunities, including all or a select geographic, industry or other subset of opportunities, to certain Brookfield Accounts (but not to us) or to other persons pursuant to contractual or other arrangements. In particular, Brookfield Accounts with real estate, infrastructure, renewable power or technology focused investment mandates generally have been (and will in the future be) given priority with respect to investment opportunities that are suitable and appropriate for them. As a result, in certain cases, Brookfield Accounts will compete with, or have priority over, our company in respect of investment opportunities, and opportunities that would otherwise be suitable for us will not be made available to us, we will receive a smaller allocation of such opportunities than would otherwise have been the case, or we will receive an allocation of such opportunities on different terms than Brookfield or Brookfield Accounts (which may be less favorable than otherwise would have been the case).
|
Brookfield Business Partners
|
108
|
•
|
Allocation of broken deal expenses. We will incur expenses with respect to the consideration and pursuit of transactions that are not ultimately consummated, referred to as broken-deal expenses, including through our investments in Brookfield Accounts. Examples of broken-deal expenses include (i) research costs, (ii) fees and expenses of legal, financial, accounting, consulting or other advisers (including Brookfield) in connection with conducting due diligence or otherwise pursuing a particular non-consummated transaction, (iii) fees and expenses in connection with arranging financing for a particular non-consummated transaction, (iv) travel costs, (v) deposits or down payments that are forfeited in connection with, or amounts paid as a penalty for, a particular non-consummated transaction and (vi) other expenses incurred in connection with activities related to a particular non-consummated transaction. Broken-deal expenses generally will be allocated among our company, Brookfield and Brookfield Accounts in the manner that Brookfield determines to be fair and equitable, which may be pro-rata or on a different basis.
|
•
|
Co-investment opportunities and expenses. Because of the scale of typical business services and industrial operations acquisitions we offer portions of certain acquisition opportunities for co-investment. In addition, because our strategy includes completing acquisitions through Brookfield Accounts, we will likely make co-investments with Brookfield and Brookfield Accounts. Decisions regarding whether and to which parties to offer co-investment opportunities are made by Brookfield and are based on a number of factors, including portfolio construction, strategic or other considerations, taking into account the specific facts and circumstances relating to each potential co-investment opportunity. As a result, from time to time, we expect to offer (or receive from Brookfield Accounts) larger or smaller portions of co-investment opportunities than would otherwise have been the case or no portion of certain opportunities.
|
109
|
Brookfield Business Partners
|
•
|
Other activities of our investment personnel. The same professionals within Brookfield’s organization who are involved in sourcing and executing acquisitions that are suitable for us are responsible for sourcing and executing opportunities for Brookfield Accounts as well as having other responsibilities within Brookfield’s broader asset management business. Limits on the availability of such individuals will likewise result in a limitation on the availability of acquisition opportunities for us, and such individuals’ broader responsibilities will potentially conflict with their responsibilities to us. These potential conflicts may be exacerbated in situations where Brookfield or its employees are entitled to greater fees, incentive compensation or other remuneration in connection with their activities for other Brookfield Accounts relative to their activities for our company or where there are differences in investments made for us relative to investments made for other Brookfield Accounts (including the Investing Affiliate (as defined below)).
|
•
|
Investments by Brookfield personnel. The partners, members, shareholders, directors, officers and employees of Brookfield (“Brookfield Personnel”) are permitted to buy and sell securities or other investments for their own or their family members’ accounts (including through Brookfield Accounts), subject to the limitations described below. Positions may be taken by such Brookfield Personnel that are the same, different from, or made at different times than positions taken directly or indirectly for us. To reduce the possibility of (a) potential conflicts between our investment activities and those of Brookfield Personnel, and (b) us being materially adversely affected by Brookfield Personnel’s personal trading activities, Brookfield has established policies and procedures relating to personal securities trading. To this end, Brookfield Personnel that participate in managing our investment activities are generally restricted from engaging in personal trading activities (unless such activities are conducted through accounts over which the personnel have no influence or control), and other personnel generally must pre-clear proposed personal trades. In addition, Brookfield’s policies include prohibitions on insider trading, front running, trading in securities that are on Brookfield’s restricted trading list, trading in securities that are subject to a black-out period and other restrictions.
|
•
|
Investments by the investing affiliate. Certain Brookfield executives own a substantial majority of an entity that makes investments for its own account (the “Investing Affiliate”). The Investing Affiliate’s activities are managed separately from our (or any Brookfield Account’s) activities. There is no formal informational barrier between the Investing Affiliate and the rest of Brookfield. Brookfield has adopted protocols designed to ensure that the Investing Affiliate’s activities do not materially adversely affect our (and Brookfield Accounts’) activities and to ensure that potential conflicts are resolved in a manner pursuant to which our (and Brookfield Accounts’) interests are, to the extent feasible, prioritized relative to the Investing Affiliate’s.
|
•
|
Warehousing investments. From time to time, Brookfield will “warehouse” certain investments on our behalf, i.e., Brookfield will make an investment on our behalf and transfer it to us at a later date at cost, plus a pre-agreed interest rate, after we have raised sufficient capital, including financing to support the acquisition. Similarly, from time to time, we will warehouse one or more investments for a Brookfield Account in which we are invested (or expect to invest) and transfer the warehoused investments to the applicable Brookfield Account at cost, plus a pre-agreed interest rate, once the Brookfield Account has raised sufficient capital, including financing, to support the acquisition. In the event the applicable Brookfield Account does not obtain sufficient capital and/or financing to purchase the warehoused investment and we cannot find another buyer for the investment, we would be forced to retain the investment, the value of which may have increased or declined.
|
•
|
Transacting with Brookfield. When permitted by applicable law and subject to and in accordance with our conflicts policy, from time to time we buy investments from and/or sell investments to Brookfield and/or Brookfield Accounts. While such transactions generally require the approval of the BBU General Partner’s independent directors and, in connection with transactions with a Brookfield Account, the advisory committee of the applicable Brookfield Account, there can be no
|
Brookfield Business Partners
|
110
|
•
|
Terms of an investment by our company may benefit or disadvantage Brookfield or a Brookfield account. In making decisions with regard to certain potential investments by our company (or by a Brookfield Account in which we are invested), Brookfield faces certain conflicts of interest between the interests of our company (or the Brookfield Account), on the one hand, and the interests of Brookfield, the Investing Affiliate and/ or Brookfield Account(s) that have already made related investments, on the other hand. Similarly, prospective investments by Brookfield or Brookfield Account(s) present conflicts of interest with respect to investments held by our company. Subject to applicable law and our conflicts policy, Brookfield from time to time causes our company to invest in securities, bank loans or other obligations of companies affiliated with or advised by Brookfield or in which Brookfield, the Investing Affiliate or a Brookfield Account has an equity, debt or other interest, or to engage in investment transactions that result in Brookfield, the Investing Affiliate or a Brookfield Account getting an economic benefit, being relieved of obligations or divested of investments. For example, from time to time we make debt or equity investments in entities which are expected to use the proceeds of such investment to repay loans from Brookfield or a Brookfield Account. Depending on the circumstance, Brookfield or such Brookfield Account would benefit if our company invested more money, thus providing sufficient funds to repay Brookfield or the Brookfield Account, or it would benefit if the loans remained outstanding and Brookfield or such Brookfield Account continued to receive payment under the existing loans, if the loans were on attractive terms (including an attractive interest rate) from the perspective of Brookfield or such Brookfield Account. Alternatively, from time to time Brookfield and/or Brookfield Account(s) are in the position of making an investment that could be used to repay loans from our company, which would present the opposite conflict. Similar conflicts arise in other situations as well. For example, in certain circumstances, we pursue take-private, asset purchase or other material transactions with an issuer in which Brookfield, the Investing Affiliate or a Brookfield Account is invested, which results in a benefit to Brookfield, the Investing Affiliate or the Brookfield Account. In situations where our activities enhance Brookfield’s, the Investing Affiliate’s or a Brookfield Account’s profitability, Brookfield could take its, the Investing Affiliate’s or the Brookfield Account’s interests into consideration in connection with actions it takes on our behalf.
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Investments with related parties. In certain circumstances, we will participate in investments that involve Brookfield or Brookfield Accounts in equity or debt positions within a transaction. For example, from time to time Brookfield or Brookfield Accounts will: (a) enter into a joint transaction with us; (b) be borrowers of certain investments or lenders in respect of our company; or (c) invest in different levels of an issuer’s capital structure. As a result of the various conflicts and related issues described herein, we could sustain losses during periods in which Brookfield or Brookfield Accounts achieve profits generally or with respect to particular investments, or could achieve lower profits or higher losses than would have been the case had the conflicts described herein not existed.
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111
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Brookfield Business Partners
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Excess funds liquidity arrangement with related parties. We have an arrangement in place with Brookfield Asset Management pursuant to which we lend Brookfield Asset Management excess funds from time to time and it lends us excess funds from time to time. This arrangement is intended to enhance the use of excess funds between us and Brookfield Asset Management when the lender has excess funds and the borrower has a business need for the capital (including, without limitation, to fund operating/investment activities and/or to pay down higher cost capital), providing (i) to the lender, a higher rate of return on the funds than it otherwise would be able to achieve in the market and (ii) to the borrower, a lower cost of funds than it otherwise would be able to obtain in the market.
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Brookfield Business Partners
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112
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Pursuit of investment opportunities by certain non-controlled affiliates. Certain companies affiliated with Brookfield (a) are controlled, in whole or in part, by persons other than Brookfield, including, for example, joint ventures or similar arrangements with third parties where Brookfield does not have complete control; (b) are separated from Brookfield pursuant to an information barrier; or (c) do not coordinate or consult with Brookfield with respect to investment decisions (together, “Non-Controlled Affiliates”). Such Non-Controlled Affiliates are likely to have investment mandates that overlap with our investment mandate giving rise to potential conflicts. For example, from time to time such Non-Controlled Affiliates or investment vehicles managed by such Non-Controlled Affiliates will pursue investment opportunities which are suitable for us but which are not made available to us since such Non-Controlled Affiliates do not consult with and/or are not wholly controlled by Brookfield. Similarly, certain of Brookfield’s investment activities are managed independently of, and carried out without any reference to the management of our company. In certain instances, there are information barriers in place pursuant to which investment operations are managed independently of each other and information is not generally shared relating to such activities.
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Arrangements with Brookfield. Our relationship with Brookfield involves a number of arrangements pursuant to which Brookfield provides various services, including access to financing arrangements and acquisition opportunities. Certain of these arrangements were effectively determined by Brookfield in the context of the spin-off, and could contain terms that are less favorable than those which otherwise might have been negotiated between unrelated parties. Circumstances may arise in which these arrangements will need to be amended or new arrangements will need to be entered into, and conflicts of interest between our company and Brookfield will arise in negotiating such new or amended arrangements. Furthermore, Brookfield is generally entitled to share in the returns generated by our operations, which creates an incentive for it to assume greater risks when making decisions than it otherwise would in the absence of such arrangements. In addition, our investment in Brookfield Accounts provides Brookfield with certain ancillary benefits, such as satisfying Brookfield’s commitment to invest in such accounts (which Brookfield would otherwise need to satisfy from different sources) and assisting Brookfield in marketing the Brookfield Accounts.
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113
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Brookfield Business Partners
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Brookfield personnel arrangements. In the ordinary course, Brookfield employees are hired or retained by, or seconded or otherwise allocated to (in whole or in part), our company and/or portfolio companies that we are directly or indirectly invested in for performance of operating services or roles that in the normal course are expected to be carried out by our (or the relevant portfolio company’s) personnel. In connection with any such arrangement, all or a portion of the compensation and overhead expenses relating to such employees (including base salaries, benefits and incentive compensation (which may include long term incentive awards of equity or options for equity in Brookfield), among other things) will directly or indirectly be borne by us or the applicable portfolio companies. The compensation and overhead expenses relating to such employees generally will be within the market compensation range for the roles filled in the relevant market based on one or more of the following (i) market compensation studies or guidance provided by third parties, (ii) recent market hires made by the relevant portfolio company for comparable positions, (iii) the employee’s peers at Brookfield and the portfolio company, and/or (iv) specific compensation reviews conducted by compensation consultants. For these purposes, given how certain compensation arrangements are structured and valued (particularly various forms of incentive compensation that vest over time and whose value upon payment is based on estimates) and how overhead expenses are generally allocated, in each case requiring certain judgments and assumptions, there can be no assurance that portfolio companies (and indirectly our company) will not bear higher costs than they would have had such expenses been valued, allocated or charged differently.
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Brookfield investments in companies. Brookfield (or Brookfield Accounts) will from time to time make equity or other investments in companies or businesses that provide services to or otherwise contract with us, Brookfield Accounts in which we are invested or our direct or indirect portfolio companies. In particular, Brookfield has in the past entered into, and expects to continue to enter into, relationships with companies in technology and other sectors and industries in which Brookfield has broad expertise and knowledge, whereby Brookfield acquires an equity or other interest in such companies that may, in turn, transact with us, Brookfield Accounts in which we are invested or our direct or indirect portfolio companies. For example, Brookfield (through an investment program referred to as Brookfield Growth) invests in emerging technology companies that develop and offer technology products that are expected to be of relevance to us, Brookfield Accounts in which we are invested or our direct or indirect portfolio companies (as well as third-party companies). In connection with such relationships, Brookfield refers, introduces or otherwise facilitates transactions between such companies and us, Brookfield Accounts in which we are invested or our direct or indirect portfolio companies In all cases, Brookfield seeks to ensure that the transactions are in the best interests of our company, the Brookfield Accounts in which we are invested and/or our direct or indirect portfolio companies, with terms to be determined in good faith as fair, reasonable and equitable under the circumstances. However, these transactions also result in benefits to Brookfield, including via increased profitability of the relevant company, as well as financial incentives and/or milestones which benefit Brookfield (including through increased equity allotments), which are likely in some cases to be significant. Such financial incentives that inure to or benefit Brookfield (or Brookfield Accounts) pose an incentive for Brookfield to cause us, Brookfield Accounts in which we are invested or our direct or indirect portfolio companies to enter into such transactions that may not have otherwise been entered into. Financial incentives derived from relationships with such companies will generally not be shared with us. Furthermore, such transactions are likely to contribute to the development of expertise, reputational benefits and/or the development of new products or services by Brookfield and/or the companies or businesses that Brookfield is invested in, which Brookfield will seek to capitalize on to generate additional benefits that are likely to inure solely to Brookfield (or Brookfield Accounts) and not to us. For the avoidance of doubt, any of the arrangements and/or benefits described in this paragraph will not require notice to, or the consent of, our unitholders. Brookfield may take its own interests into account in considering and making determinations regarding these matters.
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Brookfield Business Partners
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114
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•
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Sharing of services. In certain circumstances, in order to create efficiencies and optimize performance, one or more of our investments, portfolio companies or assets will determine to share the operational, legal, financial, back-office or other resources of another of our investments, portfolio companies or assets, or of an investment, portfolio company or asset of Brookfield or a Brookfield Account. In connection therewith, the costs and expenses related to such services will be allocated among the relevant entities on a basis that Brookfield determines in good faith is fair and equitable (but which will be inherently subjective, and there can be no assurance that we will not bear a disproportionate amount of any costs, including Brookfield’s internal costs).
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Related party transactions. We (including our portfolio companies and portfolio companies of Brookfield Accounts that we are invested in) are and will be counterparties in agreements, transactions and other arrangements with other Brookfield Accounts (including their portfolio companies) for the provision of goods and services, purchase and sale of assets and other matters that would otherwise be transacted with independent third parties. Some of these agreements, transactions and other arrangements would not have been entered into but for the affiliation or relationship with Brookfield and, in certain cases, are expected to replace agreements, transactions and/or arrangements with third parties. These agreements, transactions and other arrangements will involve payment of fees and other amounts and/or other benefits to Brookfield Accounts and their portfolio companies (including, in certain cases, performance-based compensation), none of which will result in any offset to management and other fees payable by our company to Brookfield. Such agreements, transactions and other arrangements will generally be entered into without the consent or direct involvement of the BBU General Partner’s independent directors or the unitholders. These agreements, transactions or other arrangements are expected to be entered into in the ordinary course. In certain cases, they will be entered into with active participation by Brookfield and in other cases by the portfolio companies’ management teams independently of Brookfield. In all cases, Brookfield will seek to ensure that the agreements, transactions or other arrangements are in the portfolio companies’ best interests, with terms to be determined in good faith as fair, reasonable and equitable under the circumstances. However, there can be no assurance that the terms of any such agreement, transaction or other arrangement will be executed on an arm’s length basis, be as favorable to the applicable portfolio company as otherwise would be the case if the counterparty were not related to Brookfield, or be the same as those that other Brookfield Accounts and their portfolio companies receive from the counterparty. In some circumstances, we and our portfolio companies may receive better terms from the counterparty than from an independent counterparty. In other cases, these terms may be worse.
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Information sharing. Because of the extensive scope of Brookfield’s activities, Brookfield often has or obtains information that can be utilized by Brookfield across multiple strategies. For example, information Brookfield has or acquires through its management of Brookfield Accounts and/or its own investing activities is used by Brookfield to identify or evaluate potential investments for us. Conversely, information Brookfield has or acquires in connection with our activities is used for the benefit of Brookfield and/or Brookfield Accounts (and, for the avoidance of doubt, Brookfield will have no duty (contractual, fiduciary or otherwise) to keep such information confidential from, or not to use such information in connection with the investment activities of, itself and/or Brookfield Accounts). Brookfield will trade, or may cause Brookfield Accounts to trade, on the basis of information it has or obtained through our investment and operations activities. In some cases, this trading will result in Brookfield and/or a Brookfield Account taking a position that is different from, and potentially adverse to, a position taken by our company, or result in Brookfield or a Brookfield Account benefiting from our investment activities. Brookfield has implemented policies and procedures to mitigate potential conflicts of interest and address certain regulatory requirements and contractual restrictions with respect to communication and information sharing. Such policies and procedures generally reduce synergies across Brookfield’s various activities, and negatively affect Brookfield’s or our ability to pursue attractive investment opportunities that would otherwise be available to Brookfield or us if such policies and procedures were not implemented. From time to time, such policies and procedures will result in our company, Brookfield or Brookfield Accounts having reduced investment opportunities or investment flexibility, or otherwise restrict us, Brookfield or Brookfield Accounts in their activities with respect to such information.
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115
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Brookfield Business Partners
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Material non-public information; trading restrictions. From time to time, our ability to buy or sell certain securities will be restricted by applicable securities laws, regulatory requirements, information held by Brookfield, contractual obligations applicable to Brookfield, and potential reputational risks relating to our company, Brookfield and/or Brookfield Accounts (including Brookfield’s internal policies designed to comply with these and similar requirements). As a result, from time to time Brookfield will not engage in transactions or other activities for, or enforce certain rights in favor of, our company due to Brookfield’s activities outside our company, regulatory requirements, policies, and reputational risk assessments.
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Client and other relationships. Brookfield pursues other business activities and provides certain services (including, in each case, through portfolio companies that it and Brookfield Accounts invest in) that compete directly with our business activities without providing us with an opportunity to participate, which results in the allocation of Brookfield’s resources, personnel and acquisition and business opportunities to others that compete with us. In addition, certain portfolio companies in which we, Brookfield and/or Brookfield Accounts are invested in provide investment banking and other advisory services to third parties with respect to assets in which we are invested or seeking to invest. The interests of such portfolio companies in such circumstances generally will conflict with (and be adverse to) our interests, and we generally will compete with such portfolio companies (and their third-party clients) in pursuing certain investments. Brookfield generally implements policies and procedures (including, for example, information barriers) to mitigate potential conflicts of interest and address certain regulatory requirements relating to these potential circumstances.
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Limited liability of Brookfield. The liability of Brookfield and its directors is limited under our arrangements with them, and we have agreed to indemnify Brookfield and its directors against claims, liabilities, losses, damages, costs or expenses which they may face in connection with those arrangements, which may lead them to assume greater risks when making decisions than they otherwise would if such decisions were being made solely for Brookfield’s own account, or may give rise to legal claims for indemnification that are adverse to the interests of our unitholders.
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Valuation of our investments. Brookfield performs certain valuation services related to our securities and assets. Brookfield performs such services in accordance with its valuation policies. From time to time, Brookfield will value a similar or identical asset differently for our company than for itself or a Brookfield Account, including because our company, Brookfield and Brookfield Accounts are subject to different valuation guidelines pursuant to our and their respective governing agreements (e.g., in connection with differing applicable regulatory restrictions), different third-party vendors are hired to perform valuation functions for our company, Brookfield or the Brookfield Accounts, or otherwise. In addition, Brookfield faces a conflict with respect to valuations generally because of their effect on Brookfield’s fees and other compensation.
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Brookfield Business Partners
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116
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Brookfield public securities group. Brookfield is an active participant, as agent and principal, in the global fixed income, currency, commodity, equities and other markets. Certain of Brookfield’s investment activities are managed independently of, and carried out without any reference to, the management of our company. For example, Brookfield invests, trades or makes a market in the equity, debt or other interests of certain of our portfolio companies without regard to the impact on us of such activities. In particular, Brookfield’s Public Securities Group (“PSG”), manages investment funds and accounts that invest in public debt and equity markets. There is currently an information barrier in place pursuant to which PSG manages its investment operations independently of other parts of Brookfield and does not generally share information relating to such activities. Consequently, neither we nor PSG consults the other about, or has awareness of, investment decisions made by the other, and neither is subject to any internal approvals over its investment decisions by any person who would have knowledge of the investment decisions of the other. As a result, PSG will not share investment opportunities that may otherwise be suitable for our company with us, and our company will have no rights with respect to such opportunities. In addition, in certain circumstances, funds and/or accounts managed by PSG will hold an interest in one of our investments and, as a result of different investment objectives and views, PSG is likely to manage such interests in a way that is different from us (including, for example, by investing in different portions of an issuer’s capital structure, short selling securities, voting securities in a different manner, and/or selling its interests at different times than us). As a result of the information sharing barrier, our investment team may not be aware of, and may not have the ability to manage, such conflicts. Brookfield has discretion at any time, and without notice to our unitholders, to remove or modify such information barrier. In the event that the information barrier is removed or modified, Brookfield would be subject to certain protocols, obligations and restrictions in managing our company, including, for example, conflicts-management protocols, aggregated regulatory reporting obligations and certain potential investment-related restrictions.
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Oaktree. In 2019, Brookfield acquired approximately 61% of the business of Oaktree. Oaktree is a global investment manager with significant assets under management, emphasizing an opportunistic, value-oriented and risk-controlled approach to investments in credit, private equity, real assets and listed equities. Brookfield and Oaktree operate their respective investment businesses largely independently pursuant to an information barrier, with each remaining under its current brand and led by its existing management and investment teams.
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117
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Brookfield Business Partners
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Brookfield Business Partners
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118
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Service providers. Our service providers or service providers of our portfolio companies (including deal sourcers, consultants, lenders, brokers, accountants, attorneys and outside directors) may be (or their affiliates may be) unitholders and/or sources of investment opportunities and counterparties therein, or may otherwise participate in transactions or other arrangements with us and/or Brookfield or Brookfield Accounts. Furthermore, employees of Brookfield or Brookfield portfolio companies have and may in the future have family members or relatives employed by service providers (particularly the large, global providers) to Brookfield, Brookfield Accounts, us, and portfolio companies that we are directly or indirectly invested in. These factors create incentives for Brookfield in deciding whether to select such a service provider. Notwithstanding the foregoing, Brookfield will only select a service provider to the extent Brookfield determines that doing so is appropriate for us given all surrounding facts and circumstances and is consistent with Brookfield’s responsibilities under applicable law, provided that, for the avoidance of doubt, Brookfield often will not seek out the lowest-cost option when engaging such service providers as other factors or considerations typically prevail over cost.
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119
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Brookfield Business Partners
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Advisors. Brookfield engages or retains strategic advisors, senior advisors, operating partners, executive advisors, consultants and/or other professionals who are not employees or affiliates of Brookfield (including former Brookfield employees as well as current and former executive officers of Brookfield portfolio companies) and who are expected, from time to time, to receive payments from, or allocations or performance-based compensation with respect to, our portfolio companies (as well as from us, Brookfield or Brookfield Accounts in which we are invested). In such circumstances, such payments from, or allocations or performance-based compensation with respect to, our direct and indirect portfolio companies and/or our company or Brookfield Accounts in which we are invested generally will be treated as expenses of our company or such Brookfield Accounts. These strategic advisors, senior advisors, operating partners, executive advisors, consultants and/or other professionals (which may include certain former Brookfield employees) in certain circumstances are offered the ability to co-invest alongside our company, including in those investments in which they are involved (and for which they may be entitled to receive performance-based compensation, which will reduce our returns), or otherwise participate in equity plans for management of a portfolio company. In certain cases, these persons are likely to have certain attributes of Brookfield “employees” (e.g., they have dedicated offices at Brookfield, participate in general meetings and events for Brookfield personnel, work on Brookfield matters as their primary or sole business activity, have Brookfield-related email addresses and/or participate in certain benefit arrangements typically reserved for Brookfield employees) even though they are not considered Brookfield employees, affiliates or personnel. Where applicable, Brookfield allocates the costs of such personnel to the applicable portfolio companies, to us and/or to Brookfield Accounts in which we are invested. Payments or allocations to Brookfield’s strategic advisors, senior advisors, operating partners, executive advisors, consultants and other similar professionals can be expected to increase the overall costs and expenses borne indirectly by unitholders. There can be no assurance that any of the strategic advisors, senior advisors, operating partners, executive advisors, consultants and/or other professionals will continue to serve in such roles and/or continue their arrangements with Brookfield and/or any portfolio companies or Brookfield Accounts.
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Diverse interests. The various types of investors in and beneficiaries of our company, including Brookfield, have conflicting investment, tax and other interests with respect to their interests. When considering a potential investment for us, Brookfield will generally consider our investment objectives, not the investment objectives of any particular investor or beneficiary. Certain of Brookfield’s decisions, including with respect to tax or other reporting positions, will be more beneficial to one type of investor or beneficiary than another, or to Brookfield than to investors or beneficiaries unaffiliated with Brookfield. Brookfield reserves the right on behalf of itself and its affiliates to take actions adverse to us or other Brookfield Accounts in these circumstances, including withholding amounts to pay actual or potential tax liabilities.
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Reputational considerations. Given the nature of its broader platform, Brookfield has an interest in preserving its reputation, including with respect to certain of its affiliates’ statuses as publicly traded vehicles, and in certain circumstances, such reputational considerations may conflict with our interests. The BBU General Partner or Brookfield have made (and will likely make) decisions on our behalf for reputational reasons that may not be directly aligned with the interests of unitholders or consistent with the determination the BBU General Partner or Brookfield otherwise would have made absent its interest in Brookfield’s broader reputation. For example, Brookfield has limited (and will in the future limit) transactions and activities on our behalf for reputational or other reasons, including where Brookfield is providing (or may provide) advice or services to an entity involved in such activity or transaction, where a Brookfield Account is or may be engaged in the same or a related activity or transaction to that being considered on our behalf, where a Brookfield Account has an interest in an entity involved in such activity or transaction, or where such activity or transaction on behalf of or in respect of our company could affect the BBU General Partner, Brookfield, Brookfield Accounts or their activities.
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Possible future activities. Brookfield expects to expand the range of services that it provides over time. Except as provided herein, Brookfield will not be restricted in the scope of its business or in the performance of any services (whether now offered or undertaken in the future) even if such activities could give rise to conflicts of interest, and whether or not such conflicts are described herein. Brookfield has, and will continue to develop, relationships with a significant number of companies, financial sponsors and their senior managers, including relationships with companies that may hold or may have held investments similar to those intended to be made by us. These companies may themselves represent appropriate investment opportunities for us or may compete with us for investment opportunities.
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Brookfield Business Partners
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120
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121
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Brookfield Business Partners
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our company will only rely on the exemption in Part 4 of National Instrument 71-102—Continuous Disclosure and Other Exemptions Relating to Foreign Issuers;
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our company will not rely on any exemption from the disclosure regime applicable to foreign private issuers under U.S. securities laws;
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our company will file its financial statements pursuant to Part 4 of NI 51-102-Continuous Disclosure Obligations, or NI 51-102, except that our company does not have to comply with the conditions in section 4.2 of NI 51-102 if it files such financial statements on or before the date that it is required to file its prospectus with the SEC;
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our company will file an interim financial report as set out in Part 4 of NI 51-102 and the management’s discussion and analysis as set out in Part 5 of NI 51-102 for each period commencing on the first day of the financial year and ending nine, six or three months before the end of the financial year;
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our company will file a material change report as set out in Part 7 of NI 51-102 in respect of any material change in the affairs of our company that is not reported or filed by our company on SEC Form 6-K; and
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our company will include in any prospectus filed by our company financial statements or other information about any acquisition that would have been or would be a significant acquisition for the purposes of Part 8 of NI 51-102 that our company has completed, or has progressed to a state where a reasonable person would believe that the likelihood of our company completing the acquisition is high if the inclusion of the financial statements is necessary for the prospectus to contain full, true and plain disclosure of all material facts relating to the securities being distributed. The requirement to include financial statements or other information will be satisfied by including or incorporating by reference: (a) the financial statements or other information as set out in Part 8 of NI 51-102, or (b) satisfactory alternative financial statements or other information, unless at least nine months of the operations of the acquired business or related businesses are incorporated into our company’s current annual financial statements included or incorporated by reference in the prospectus.
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122
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123
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Brookfield Business Partners
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Brookfield Business Partners
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124
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125
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Brookfield Business Partners
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Brookfield Business Partners
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126
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enlarge the obligations of any limited partner without its consent, except that any amendment that would have a material adverse effect on the rights or preferences of any class of partnership interests in relation to other classes of partnership interests may be consented to or approved by at least a majority of the type or class of partnership interests so affected; or
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enlarge the obligations of, restrict in any way any action by or rights of or reduce in any way the amounts distributable, reimbursable or otherwise payable by our company to the BBU General Partner or any of its affiliates without the consent of the BBU General Partner, which may be given or withheld in its sole discretion.
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a change in the name of our company, the location of our registered office or our registered agent;
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the admission, substitution or withdrawal of partners in accordance with our Limited Partnership Agreement;
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a change that the BBU General Partner determines is reasonable and necessary or appropriate for our company to qualify or to continue our company’s qualification as an exempted limited partnership under the laws of Bermuda or a partnership in which the limited partners have limited liability under the laws of any jurisdiction, or is necessary or advisable in the opinion of the BBU General Partner to ensure that our company will not be treated as an association taxable as a corporation or otherwise taxed as an entity for tax purposes;
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an amendment that the BBU General Partner determines to be necessary or appropriate to address changes in tax regulations, legislation or interpretation;
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an amendment that is necessary, in the opinion of our counsel, to prevent our company or the BBU General Partner or its directors or officers from in any manner being subjected to the provisions of the U.S. Investment Company Act of 1940, as amended (the ”Investment Company Act”), or similar legislation in other jurisdictions;
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an amendment that the BBU General Partner determines in its sole discretion to be necessary or appropriate in connection with the creation, authorization or issuance of any class or series of partnership interests or options, rights, warrants or appreciation rights relating to partnership securities;
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any amendment expressly permitted in our Limited Partnership Agreement to be made by the BBU General Partner acting alone;
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any amendment that the BBU General Partner determines in its sole discretion to be necessary or appropriate to reflect and account for the formation by our company of, or its investment in, any corporation, partnership, joint venture, limited liability company or other entity, as otherwise permitted by our Limited Partnership Agreement;
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a change in our company’s fiscal year and related changes; or
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any other amendments substantially similar to any of the matters described in (1) through (9) above.
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do not adversely affect our company’s limited partners considered as a whole (including any particular class of partnership interests as compared to other classes of partnership interests) in any material respect;
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are necessary or appropriate to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any governmental agency or judicial authority;
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are necessary or appropriate to facilitate the trading of our units or to comply with any rule, regulation, guideline or requirement of any securities exchange on which our units or any other partnership interests are or will be listed for trading;
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are necessary or appropriate for any action taken by the BBU General Partner relating to splits or combinations of units under the provisions of our Limited Partnership Agreement; or
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are required to effect the intent expressed in the final registration statement and prospectus filed in connection with the spin-off or the intent of the provisions of our Limited Partnership Agreement or are otherwise contemplated by our Limited Partnership Agreement.
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Brookfield Business Partners
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128
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Brookfield Business Partners
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Brookfield Business Partners
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130
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131
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Brookfield Business Partners
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executed our Limited Partnership Agreement and become bound by the terms thereof;
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granted an irrevocable power of attorney to the BBU General Partner or the liquidator of our company and any officer thereof to act as such partner’s agent and attorney-in-fact to execute, swear to, acknowledge, deliver, file and record in the appropriate public offices: (i) all certificates, documents or other instruments relating to the existence or qualification of our company as an exempted limited partnership (or a partnership in which the limited partners have limited liability) in Bermuda and in all jurisdictions in which our company may conduct activities and affairs or own property; any amendment, change, modification or restatement of our Limited Partnership Agreement, subject to the requirements of our Limited Partnership Agreement; the dissolution and liquidation of our company; the admission or withdrawal of any partner of our company or any capital contribution of any partner of our company; the determination of the rights, preferences and privileges of any class or series of units or other partnership interests of our company, and any tax election with any limited partner or general partner on behalf of our company or its partners; and (ii) subject to the requirements of our Limited Partnership Agreement, all ballots, consents, approvals, waivers, certificates, documents and other instruments necessary or appropriate, in the sole discretion of the BBU General Partner or the liquidator of our company, to make, evidence, give, confirm or ratify any voting consent, approval, agreement or other action that is made or given by our company’s partners or is consistent with the terms of our Limited Partnership Agreement or to effectuate the terms or intent of our Limited Partnership Agreement;
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made the consents and waivers contained in our Limited Partnership Agreement, including with respect to the approval of the transactions and agreements entered into in connection with our formation and the spin-off; and
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ratified and confirmed all contracts, agreements, assignments and instruments entered into on behalf of our company in accordance with our Limited Partnership Agreement, including the granting of any charge or security interest over the assets of our company and the assumption of any indebtedness in connection with the affairs of our company.
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Brookfield Business Partners
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132
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133
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Brookfield Business Partners
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first, 100% of any available cash to our company until our company has been distributed an amount equal to our expenses and outlays for the quarter properly incurred;
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second, to the extent distributions in respect of redemption-exchange units have accrued in previous quarters (as described below), 100% to all the holders of redemption-exchange units pro rata in proportion to their respective percentage interests (which will be calculated using redemption-exchange units only) of all amounts that have been accrued in previous quarters and not yet recovered;
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•
|
third, to the extent that incentive distributions have been deferred in previous quarters, 100% to the holder of the Special LP Units of all amounts that have been accrued in previous quarters and not yet recovered;
|
•
|
fourth, to all owners of the Holding LP’s partnership interests, pro rata to their percentage interests up to the amount per unit of the then regular quarterly distribution (currently $0.0625 per unit) for such quarter;
|
•
|
fifth, 100% to the holder of the Special LP Units until an amount equal to the incentive distribution amount (see below for an explanation of the calculation of the incentive distribution amount) for the preceding quarter has been distributed provided that for any quarter in which our company determines that there is insufficient cash to pay the incentive distribution, our company may elect to pay all or a portion of this distribution in redemption-exchange units or may elect to defer all or a portion of the amount distributable for payment from available cash in future quarters; and
|
•
|
thereafter, any available cash then remaining to the owners of the Holding LP’s partnership interests, pro rata to their percentage interests.
|
Brookfield Business Partners
|
134
|
•
|
first, 100% to our company until our company has received an amount equal to the excess of: (i) the amount of our outlays and expenses incurred during the term of the Holding LP; over (ii) the aggregate amount of distributions received by our company pursuant to the first tier of the Regular Distribution Waterfall during the term of the Holding LP;
|
•
|
second, 100% to the partners of the Holding LP, in proportion to their respective amounts of unrecovered capital in the Holding LP;
|
•
|
third, to the extent that incentive distributions have been deferred in previous quarters, 100% to the holder of the Special LP Units of all amounts that have been accrued in previous quarters and not yet recovered;
|
•
|
fourth, to all owners of the Holding LP’s partnership interests, pro rata to their percentage interests up to the amount per unit of the then regular quarterly distribution (currently $0.0625 per unit) for such quarter;
|
•
|
fifth, 100% to the holder of the Special LP Units until an amount equal to the incentive distribution amount (see above for an explanation of the calculation of the incentive distribution amount) for the preceding quarter has been distributed; and
|
•
|
thereafter, any available cash then remaining to the owners of the Holding LP’s partnership interests, pro rata to their percentage interests.
|
135
|
Brookfield Business Partners
|
1.
|
enlarge the obligations of any limited partner of the Holding LP without its consent, except that any amendment that would have a material adverse effect on the rights or preferences of any class of partnership interests in relation to other classes of partnership interests may be approved by at least a majority of the type or class of partnership interests so affected; or
|
2.
|
enlarge the obligations of, restrict in any way any action by or rights of, or reduce in any way the amounts distributable, reimbursable or otherwise payable by the Holding LP to the BBU General Partner or any of its affiliates without the consent of the BBU General Partner which may be given or withheld in its sole discretion.
|
Brookfield Business Partners
|
136
|
1.
|
a change in the name of the Holding LP, the location of the Holding LP’s registered office or the Holding LP’s registered agent;
|
2.
|
the admission, substitution, withdrawal or removal of partners in accordance with the Holding LP Limited Partnership Agreement;
|
3.
|
a change that our company determines is reasonable and necessary or appropriate for the Holding LP to qualify or to continue its qualification as an exempted limited partnership under the laws of Bermuda or a partnership in which the limited partners have limited liability under the laws of any jurisdiction, or is necessary or advisable in the opinion of our company to ensure that the Holding LP will not be treated as an association taxable as a corporation or otherwise taxed as an entity for tax purposes;
|
4.
|
an amendment that our company determines to be necessary or appropriate to address certain changes in tax regulations, legislation or interpretation;
|
5.
|
an amendment that is necessary, in the opinion of counsel, to prevent the Holding LP or our company or its directors or officers, from in any manner being subjected to the provisions of the Investment Company Act or similar legislation in other jurisdictions;
|
6.
|
an amendment that our company determines in its sole discretion to be necessary or appropriate for the creation, authorization or issuance of any class or series of partnership interests or options, rights, warrants or appreciation rights relating to partnership interests;
|
7.
|
any amendment expressly permitted in the Holding LP Limited Partnership Agreement to be made by our company acting alone;
|
8.
|
any amendment that our company determines in its sole discretion to be necessary or appropriate to reflect and account for the formation or ownership by the Holding LP of, or its investment in, any corporation, partnership, joint venture, limited liability company or other entity, as otherwise permitted by the Holding LP Limited Partnership Agreement;
|
9.
|
a change in the Holding LP’s fiscal year and related changes;
|
10.
|
any amendment concerning the computation or allocation of specific items of income, gain, expense or loss among the partners that, in the sole discretion of our company, is necessary or appropriate to: (i) comply with the requirements of applicable law; (ii) reflect the partners’ interests in the Holding LP; or (iii) consistently reflect the distributions made by the Holding LP to the partners pursuant to the terms of the Holding LP Limited Partnership Agreement;
|
11.
|
any amendment that our company determines in its sole discretion to be necessary or appropriate to address any statute, rule, regulation, notice, or announcement that affects or could affect the U.S. federal income tax treatment of any allocation or distribution related to any interest of our company in the profits of the Holding LP; or
|
12.
|
any other amendments substantially similar to any of the matters described in (1) through (11) above.
|
1.
|
do not adversely affect the Holding LP limited partners considered as a whole (including any particular class of partnership interests as compared to other classes of partnership interests) in any material respect;
|
2.
|
are necessary or appropriate to satisfy any requirements, conditions or guidelines contained in any opinion or binding directive, order, ruling or regulation of any governmental agency or judicial authority;
|
3.
|
are necessary or appropriate for any action taken by our company relating to splits or combinations or units or partnership interests under the provisions of the Holding LP Limited Partnership Agreement; or
|
137
|
Brookfield Business Partners
|
4.
|
are required to effect the intent expressed in the final registration and prospectus filed in connection with the spin-off or the intent of the provisions of the Holding LP Limited Partnership Agreement or are otherwise contemplated by the Holding LP Limited Partnership Agreement.
|
Brookfield Business Partners
|
138
|
139
|
Brookfield Business Partners
|
Brookfield Business Partners
|
140
|
1.
|
Master Services Agreement, dated June 1, 2016, by and among Brookfield Asset Management, the Service Recipients and the Service Providers described under the heading Item 7.B., “Related Party Transactions-Our Master Services Agreement”;
|
2.
|
Relationship Agreement, dated June 1, 2016, by and among Brookfield Asset Management, our company, the Holding LP, the Holding Entities and the Service Providers described under the heading Item 7.B., “Related Party Transactions-Relationship Agreement”;
|
3.
|
Registration Rights Agreement, dated June 1, 2016, between our company and Brookfield Asset Management described under the heading Item 7.B., “Related Party Transactions-Registration Rights Agreement”;
|
4.
|
Credit Agreement, dated October 19, 2017, between BGIS US Inc. as lender, our company as guarantor and Holding LP, CanHoldco, Bermuda Holdco and US Holdco as borrowers described under the heading Item 7.B., “Related Party Transactions-Credit Facilities”;
|
5.
|
Amended and Restated Limited Partnership Agreement of our company, dated May 31, 2016, described under the heading Item 10.B., “Memorandum and Articles of Association-Description of our Units and our Limited Partnership Agreement”;
|
6.
|
Amended and Restated Limited Partnership Agreement of Holding LP, dated May 31, 2016, described under the heading Item 10.B., “Description of the Holding LP Limited Partnership Agreement”;
|
7.
|
Voting Agreement, dated June 1, 2016, by and among Brookfield Asset Management, Brookfield CanGP Limited, Brookfield Canadian GP LP and CanHoldco described under the heading Item 7.B., “Related Party Transactions-Voting Agreements”; and
|
8.
|
Trade-Mark Sublicense Agreement, dated May 24, 2016, by and among Brookfield Asset Management Holdings Ltd., our company, and the Holding LP.
|
141
|
Brookfield Business Partners
|
Brookfield Business Partners
|
142
|
143
|
Brookfield Business Partners
|
Brookfield Business Partners
|
144
|
145
|
Brookfield Business Partners
|
Brookfield Business Partners
|
146
|
147
|
Brookfield Business Partners
|
Brookfield Business Partners
|
148
|
149
|
Brookfield Business Partners
|
Brookfield Business Partners
|
150
|
151
|
Brookfield Business Partners
|
Brookfield Business Partners
|
152
|
(i)
|
the name, address and taxpayer identification number of the beneficial owner and the nominee;
|
(ii)
|
whether the beneficial owner is (a) a person that is not a U.S. person, (b) a foreign government, an international organization, or any wholly-owned agency or instrumentality of either of the foregoing, or (c) a tax-exempt entity;
|
(iii)
|
the amount and description of units held, acquired, or transferred for the beneficial owner; and
|
(iv)
|
specific information including the dates of acquisitions and transfers, means of acquisitions and transfers and acquisition cost for purchases, as well as the amount of net proceeds from sales.
|
153
|
Brookfield Business Partners
|
Brookfield Business Partners
|
154
|
155
|
Brookfield Business Partners
|
Brookfield Business Partners
|
156
|
157
|
Brookfield Business Partners
|
Brookfield Business Partners
|
158
|
159
|
Brookfield Business Partners
|
Brookfield Business Partners
|
160
|
161
|
Brookfield Business Partners
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||
(US$ MILLIONS)
|
|
USD
|
|
%
|
|
USD
|
|
%
|
||||||
Audit fees (1)
|
|
$
|
13.3
|
|
|
47
|
%
|
|
$
|
11.1
|
|
|
47
|
%
|
Audit-related fees (2)
|
|
14.0
|
|
|
50
|
%
|
|
11.8
|
|
|
50
|
%
|
||
Tax fees (3)
|
|
0.9
|
|
|
3
|
%
|
|
0.8
|
|
|
3
|
%
|
||
Total
|
|
$
|
28.2
|
|
|
100
|
%
|
|
$
|
23.7
|
|
|
100
|
%
|
(1)
|
Audit fees include fees for services that would normally be provided by the external auditor in connection with our statutory audit of the partnership, including fees for services necessary to perform an audit or review in accordance with generally accepted auditing standards. This category also includes services that generally only the external auditor reasonably can provide, including comfort letters, attest services, consents and assistance with and review of certain documents filed with securities regulatory authorities.
|
(2)
|
Audit-related fees are for other statutory audits, assurance and related services, such as due diligence services, that traditionally are performed by the external auditor. More specifically, these services include, among others: statutory audits of our subsidiaries, employee benefit plan audits, audits in connection with acquisitions, attest services that are not required for the partnership’s statutory audit, and consultation concerning financial accounting and reporting standards.
|
(3)
|
Tax fees are principally for assistance in tax compliance and tax advisory services.
|
Brookfield Business Partners
|
162
|
163
|
Brookfield Business Partners
|
Number
|
|
Description
|
|
1.1
|
|
|
|
1.2
|
|
|
|
1.3
|
|
|
|
2.1
|
|
|
|
4.1
|
|
|
|
4.2
|
|
|
|
4.3
|
|
|
|
4.4
|
|
|
|
4.5
|
|
|
|
4.6
|
|
|
|
4.7
|
|
|
|
8.1
|
|
|
List of subsidiaries of Brookfield Business Partners L.P. (incorporated by reference to Item 4.C., Organizational Structure)
|
12.1
|
|
|
|
12.2
|
|
|
|
13.1
|
|
|
|
13.2
|
|
|
|
15.1
|
|
|
|
101.INS
|
|
|
XBRL Instance Document*
|
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document*
|
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document*
|
101.DEF
|
|
|
XBRL Taxonomy Extension Definition Linkbase Document*
|
101.LAB
|
|
|
XBRL Taxonomy Extension Label Linkbase Document*
|
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document*
|
(1)
|
Filed as an exhibit to Amendment No. 3 to the Registration Statement on Form F-1 on February 26, 2016 and incorporated herein by reference.
|
(2)
|
Incorporated by reference to the company’s Current Report on Form 6-K filed on June 22, 2016.
|
(3)
|
Incorporated by reference to the company’s Annual Report on Form 20-F for the year ended December 31, 2017, filed March 9, 2018.
|
Brookfield Business Partners
|
164
|
|
|
BROOKFIELD BUSINESS PARTNERS L.P., by its general
partner, BROOKFIELD BUSINESS PARTNERS LIMITED
|
||
|
|
By:
|
/s/ Jane Sheere
|
|
|
|
|
Name:
|
Jane Sheere
|
|
|
|
Title:
|
Secretary
|
Date: March 5, 2020
|
|
|
|
|
165
|
Brookfield Business Partners
|
|
|
Page
|
Consolidated financial statements for Brookfield Business Partners L.P. as at December 31, 2019 and 2018 and for each of the years in the three-years ended December 31, 2019
|
|
F-1
|
Brookfield Business Partners
|
F-1
|
|
Page
|
F-2
|
Brookfield Business Partners
|
F-3
|
Brookfield Business Partners
|
•
|
Evaluated the effectiveness of controls over management’s process for determining the fair value of intangible assets including those over forecasted revenue, EBITDA, discount rates and the fair value of unearned premium reserves including the loss emergence period.
|
•
|
Evaluated the reasonableness of management’s forecasted revenue and EBITDA used in the valuation of intangible assets by comparing the projections to historical results, analyst industry reports and evidence obtained in other areas of the audit.
|
•
|
With the assistance of fair value specialists, evaluated the reasonableness of the discount rates used in the valuation of intangible assets, including testing the source information underlying the determination of the discount rates, testing the mathematical accuracy of the calculation, and developing a range of independent estimates, comparing it to the discount rates selected by management.
|
•
|
With the assistance of actuarial specialists, evaluated the reasonableness of the loss emergence period by comparing to historical results, industry data and evidence obtained in other areas of the audit.
|
•
|
Evaluated the effectiveness of controls over the selection of the cash flow forecasts and the selection of the discount rates used to determine the recoverable amounts.
|
•
|
Evaluated management’s ability to accurately forecast cash flows by comparing actual results to historical forecasts made.
|
•
|
Evaluated the reasonableness of management’s cash flow forecasts by comparing the forecasts to the business plan, as well as analyst and industry reports, including those of peer companies.
|
•
|
With the assistance of fair value specialists, evaluated the reasonableness of the discount rates, including testing the source information underlying the determination of the discount rates, testing the mathematical accuracy of the calculation, and developing a range of independent estimates and comparing those to the discount rates selected by management.
|
Brookfield Business Partners
|
F-4
|
F-5
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
Notes
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Assets
|
|
|
|
|
|
||||
Current assets
|
|
|
|
|
|
||||
Cash and cash equivalents
|
4
|
|
$
|
1,986
|
|
|
$
|
1,949
|
|
Financial assets
|
5
|
|
1,148
|
|
|
886
|
|
||
Accounts and other receivable, net
|
6
|
|
4,808
|
|
|
4,307
|
|
||
Inventory, net
|
7
|
|
3,490
|
|
|
1,562
|
|
||
Other assets
|
8, 10
|
|
1,363
|
|
|
1,077
|
|
||
|
|
|
12,795
|
|
|
9,781
|
|
||
Financial assets
|
5
|
|
5,095
|
|
|
483
|
|
||
Accounts and other receivable, net
|
6
|
|
823
|
|
|
853
|
|
||
Other assets
|
10
|
|
429
|
|
|
499
|
|
||
Property, plant and equipment
|
12
|
|
13,892
|
|
|
6,947
|
|
||
Deferred income tax assets
|
19
|
|
667
|
|
|
280
|
|
||
Intangible assets
|
13
|
|
11,559
|
|
|
5,523
|
|
||
Equity accounted investments
|
15
|
|
1,273
|
|
|
541
|
|
||
Goodwill
|
14
|
|
5,218
|
|
|
2,411
|
|
||
|
29
|
|
$
|
51,751
|
|
|
$
|
27,318
|
|
Liabilities and equity
|
|
|
|
|
|
||||
Current liabilities
|
|
|
|
|
|
||||
Accounts payable and other
|
16
|
|
$
|
9,881
|
|
|
$
|
7,197
|
|
Corporate borrowings
|
18
|
|
—
|
|
|
—
|
|
||
Non-recourse borrowings in subsidiaries of the partnership
|
18
|
|
1,143
|
|
|
1,819
|
|
||
|
|
|
11,024
|
|
|
9,016
|
|
||
Accounts payable and other
|
16
|
|
6,615
|
|
|
1,894
|
|
||
Non-recourse borrowings in subsidiaries of the partnership
|
18
|
|
21,256
|
|
|
9,047
|
|
||
Deferred income tax liabilities
|
19
|
|
1,803
|
|
|
867
|
|
||
|
|
|
$
|
40,698
|
|
|
$
|
20,824
|
|
Equity
|
|
|
|
|
|
||||
Limited partners
|
20
|
|
$
|
2,116
|
|
|
$
|
1,548
|
|
Non-controlling interests attributable to:
|
|
|
|
|
|
||||
Redemption-Exchange Units, Preferred Shares and Special Limited Partnership Units held by Brookfield Asset Management Inc.
|
20
|
|
1,676
|
|
|
1,415
|
|
||
Interest of others in operating subsidiaries
|
11
|
|
7,261
|
|
|
3,531
|
|
||
|
|
|
11,053
|
|
|
6,494
|
|
||
|
|
|
$
|
51,751
|
|
|
$
|
27,318
|
|
F-6
|
Brookfield Business Partners
|
(US$ MILLIONS, except per unit amounts)
|
|
Notes
|
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
25, 29
|
|
$
|
43,032
|
|
|
$
|
37,168
|
|
|
$
|
22,823
|
|
Direct operating costs
|
|
7, 22
|
|
(38,327
|
)
|
|
(34,134
|
)
|
|
(21,876
|
)
|
|||
General and administrative expenses
|
|
29
|
|
(832
|
)
|
|
(643
|
)
|
|
(340
|
)
|
|||
Depreciation and amortization expense
|
|
29
|
|
(1,804
|
)
|
|
(748
|
)
|
|
(371
|
)
|
|||
Interest income (expense), net
|
|
29
|
|
(1,274
|
)
|
|
(498
|
)
|
|
(202
|
)
|
|||
Equity accounted income, net
|
|
15
|
|
114
|
|
|
10
|
|
|
69
|
|
|||
Impairment expense, net
|
|
12, 14
|
|
(609
|
)
|
|
(218
|
)
|
|
(39
|
)
|
|||
Gain on acquisitions/dispositions, net
|
|
3, 9
|
|
726
|
|
|
500
|
|
|
267
|
|
|||
Other income (expense), net
|
|
3
|
|
(400
|
)
|
|
(136
|
)
|
|
(108
|
)
|
|||
Income (loss) before income tax
|
|
|
|
626
|
|
|
1,301
|
|
|
223
|
|
|||
Income tax (expense) recovery
|
|
|
|
|
|
|
|
|
||||||
Current
|
|
19
|
|
(324
|
)
|
|
(186
|
)
|
|
(30
|
)
|
|||
Deferred
|
|
19
|
|
132
|
|
|
88
|
|
|
22
|
|
|||
Net income (loss)
|
|
|
|
$
|
434
|
|
|
$
|
1,203
|
|
|
$
|
215
|
|
Attributable to:
|
|
|
|
|
|
|
|
|
||||||
Limited partners
|
|
|
|
$
|
43
|
|
|
$
|
74
|
|
|
$
|
(58
|
)
|
Non-controlling interests attributable to:
|
|
|
|
|
|
|
|
|
||||||
Redemption-Exchange Units held by Brookfield Asset Management Inc.
|
|
|
|
45
|
|
|
70
|
|
|
(60
|
)
|
|||
Special Limited Partners
|
|
20
|
|
—
|
|
|
278
|
|
|
142
|
|
|||
Interest of others in operating subsidiaries
|
|
|
|
346
|
|
|
781
|
|
|
191
|
|
|||
|
|
|
|
434
|
|
|
1,203
|
|
|
215
|
|
|||
Basic and diluted earnings per limited partner unit
|
|
20
|
|
$
|
0.62
|
|
|
$
|
1.11
|
|
|
$
|
(1.04
|
)
|
F-7
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
Notes
|
|
2019
|
|
2018
|
|
2017
|
||||||
Net income (loss)
|
|
|
$
|
434
|
|
|
$
|
1,203
|
|
|
$
|
215
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||
Items that may be reclassified subsequently to net income (loss):
|
|
|
|
|
|
|
|
||||||
Foreign currency translation
|
|
|
$
|
13
|
|
|
$
|
(422
|
)
|
|
$
|
127
|
|
Available-for-sale securities
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|||
Net investment and cash flow hedges
|
4
|
|
(132
|
)
|
|
72
|
|
|
(25
|
)
|
|||
Equity accounted investment
|
15
|
|
—
|
|
|
(1
|
)
|
|
(5
|
)
|
|||
Reclassification to profit or loss on disposal
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|||
Taxes on the above items
|
19
|
|
13
|
|
|
(8
|
)
|
|
(1
|
)
|
|||
|
|
|
(88
|
)
|
|
(359
|
)
|
|
104
|
|
|||
|
|
|
|
|
|
|
|
||||||
Items that will not be reclassified subsequently to net income (loss):
|
|
|
|
|
|
|
|
||||||
Revaluation of pension obligations
|
31
|
|
(122
|
)
|
|
(70
|
)
|
|
5
|
|
|||
Fair value through other comprehensive income
|
|
|
10
|
|
|
35
|
|
|
—
|
|
|||
Taxes on the above items
|
|
|
2
|
|
|
6
|
|
|
—
|
|
|||
Total other comprehensive income (loss)
|
|
|
(198
|
)
|
|
(388
|
)
|
|
109
|
|
|||
Comprehensive income (loss)
|
|
|
$
|
236
|
|
|
$
|
815
|
|
|
$
|
324
|
|
Attributable to:
|
|
|
|
|
|
|
|
||||||
Limited partners
|
|
|
$
|
11
|
|
|
$
|
1
|
|
|
$
|
(29
|
)
|
Non-controlling interests attributable to:
|
|
|
|
|
|
|
|
||||||
Redemption-Exchange Units held by Brookfield Asset Management Inc.
|
|
|
16
|
|
|
1
|
|
|
(28
|
)
|
|||
Special Limited Partners
|
|
|
—
|
|
|
278
|
|
|
142
|
|
|||
Interest of others in operating subsidiaries
|
|
|
209
|
|
|
535
|
|
|
239
|
|
|||
|
|
|
$
|
236
|
|
|
$
|
815
|
|
|
$
|
324
|
|
F-8
|
Brookfield Business Partners
|
|
|
|
|
|
|
|
Non-Controlling Interests
|
|
|
||||||||||||||||||||||||||||||||||||||
|
Limited Partners
|
|
Redemption-Exchange Units held by
Brookfield Asset Management Inc.
|
|
Special Limited Partners
|
|
Preferred Shares
|
|
|
|
|
||||||||||||||||||||||||||||||||||||
(US$ MILLIONS)
|
Capital
|
Retained earnings
|
Ownership
change (2) |
Accumulated
other
comprehensive
income
(loss)(1)
|
Limited
Partners
|
|
Capital
|
Retained earnings
|
Ownership
change (2) |
Accumulated
other
comprehensive
income
(loss) (1)
|
Redemption-
Exchange
Units
|
|
Retained earnings
|
|
Capital
|
|
Interest of
Others in
Operating
Subsidiaries
|
|
Total
equity
|
||||||||||||||||||||||||||||
Balance as at January 1, 2019
|
$
|
1,766
|
|
$
|
(237
|
)
|
$
|
205
|
|
$
|
(186
|
)
|
$
|
1,548
|
|
|
$
|
1,674
|
|
$
|
(234
|
)
|
$
|
195
|
|
$
|
(235
|
)
|
$
|
1,400
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
3,531
|
|
|
$
|
6,494
|
|
Net income (loss)
|
—
|
|
43
|
|
—
|
|
—
|
|
43
|
|
|
—
|
|
45
|
|
—
|
|
—
|
|
45
|
|
|
—
|
|
|
—
|
|
|
346
|
|
|
434
|
|
||||||||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(32
|
)
|
(32
|
)
|
|
—
|
|
—
|
|
—
|
|
(29
|
)
|
(29
|
)
|
|
—
|
|
|
—
|
|
|
(137
|
)
|
|
(198
|
)
|
||||||||||||||
Total comprehensive income (loss)
|
—
|
|
43
|
|
—
|
|
(32
|
)
|
11
|
|
|
—
|
|
45
|
|
—
|
|
(29
|
)
|
16
|
|
|
—
|
|
|
—
|
|
|
209
|
|
|
236
|
|
||||||||||||||
Contributions
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
235
|
|
|
235
|
|
||||||||||||||
Distributions
|
—
|
|
(18
|
)
|
—
|
|
—
|
|
(18
|
)
|
|
—
|
|
(17
|
)
|
—
|
|
—
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
(1,678
|
)
|
|
(1,713
|
)
|
||||||||||||||
Ownership change (3)
|
—
|
|
(5
|
)
|
15
|
|
—
|
|
10
|
|
|
—
|
|
(3
|
)
|
15
|
|
—
|
|
12
|
|
|
—
|
|
|
—
|
|
|
(441
|
)
|
|
(419
|
)
|
||||||||||||||
Acquisition of interest (4)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,405
|
|
|
5,405
|
|
||||||||||||||
Unit issuances net of repurchases (2)
|
565
|
|
—
|
|
—
|
|
—
|
|
565
|
|
|
250
|
|
—
|
|
—
|
|
—
|
|
250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
815
|
|
||||||||||||||
Balance as at December 31, 2019
|
$
|
2,331
|
|
$
|
(217
|
)
|
$
|
220
|
|
$
|
(218
|
)
|
$
|
2,116
|
|
|
$
|
1,924
|
|
$
|
(209
|
)
|
$
|
210
|
|
$
|
(264
|
)
|
$
|
1,661
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
7,261
|
|
|
$
|
11,053
|
|
Balance as at January 1, 2018
|
$
|
1,766
|
|
$
|
(69
|
)
|
$
|
—
|
|
$
|
(112
|
)
|
$
|
1,585
|
|
|
$
|
1,674
|
|
$
|
(71
|
)
|
$
|
—
|
|
$
|
(165
|
)
|
$
|
1,438
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
3,026
|
|
|
$
|
6,064
|
|
Adoption of new
accounting standards |
—
|
|
(133
|
)
|
—
|
|
—
|
|
(133
|
)
|
|
—
|
|
(128
|
)
|
—
|
|
—
|
|
(128
|
)
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
|
(275
|
)
|
||||||||||||||
Revised Opening Balance January 1, 2018
|
1,766
|
|
(202
|
)
|
—
|
|
(112
|
)
|
1,452
|
|
|
1,674
|
|
(199
|
)
|
—
|
|
(165
|
)
|
1,310
|
|
|
—
|
|
|
15
|
|
|
3,012
|
|
|
5,789
|
|
||||||||||||||
Net income (loss)
|
—
|
|
74
|
|
—
|
|
—
|
|
74
|
|
|
—
|
|
70
|
|
—
|
|
—
|
|
70
|
|
|
278
|
|
|
—
|
|
|
781
|
|
|
1,203
|
|
||||||||||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
(73
|
)
|
(73
|
)
|
|
—
|
|
—
|
|
—
|
|
(69
|
)
|
(69
|
)
|
|
—
|
|
|
—
|
|
|
(246
|
)
|
|
(388
|
)
|
||||||||||||||
Total comprehensive income (loss)
|
—
|
|
74
|
|
—
|
|
(73
|
)
|
1
|
|
|
—
|
|
70
|
|
—
|
|
(69
|
)
|
1
|
|
|
278
|
|
|
—
|
|
|
535
|
|
|
815
|
|
||||||||||||||
Contributions
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|
85
|
|
||||||||||||||
Distributions (2)
|
—
|
|
(16
|
)
|
—
|
|
—
|
|
(16
|
)
|
|
—
|
|
(16
|
)
|
—
|
|
—
|
|
(16
|
)
|
|
(278
|
)
|
|
—
|
|
|
(2,370
|
)
|
|
(2,680
|
)
|
||||||||||||||
Ownership Changes (3)
|
—
|
|
(93
|
)
|
205
|
|
(1
|
)
|
111
|
|
|
—
|
|
(89
|
)
|
195
|
|
(1
|
)
|
105
|
|
|
—
|
|
|
—
|
|
|
1,564
|
|
|
1,780
|
|
||||||||||||||
Acquisition of Interest (4)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
705
|
|
|
705
|
|
||||||||||||||
Balance as at December 31, 2018
|
$
|
1,766
|
|
$
|
(237
|
)
|
$
|
205
|
|
$
|
(186
|
)
|
$
|
1,548
|
|
|
$
|
1,674
|
|
$
|
(234
|
)
|
$
|
195
|
|
$
|
(235
|
)
|
$
|
1,400
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
3,531
|
|
|
$
|
6,494
|
|
(1)
|
See Note 21 for additional information.
|
(2)
|
See Note 20 for additional information on distributions as it relates to the Special Limited Partners and for additional information on the unit issuance.
|
(3)
|
Includes gains or losses on changes in ownership interests of consolidated subsidiaries.
|
(4)
|
See Note 3 for additional information.
|
F-9
|
Brookfield Business Partners
|
|
|
|
|
|
|
Non-Controlling Interests
|
|
|
|||||||||||||||||||||||||||||||||
|
Limited Partners
|
|
Redemption-Exchange Units held by
Brookfield Asset Management Inc. |
|
Special Limited Partners
|
|
Preferred Shares
|
|
|
|
|
||||||||||||||||||||||||||||||
(US$ MILLIONS)
|
Capital
|
Retained Earnings
|
Accumulated
Other
Comprehensive
income
(loss) (1)
|
Limited
Partners |
|
Capital
|
Retained Earnings
|
Accumulated
Other
Comprehensive
income
(loss) (1)
|
Redemption-
Exchange Units |
|
Retained Earnings
|
|
Capital
|
|
Interest of
Others in Operating Subsidiaries |
|
Total
Equity |
||||||||||||||||||||||||
Balance as at January 1, 2017
|
$
|
1,345
|
|
$
|
2
|
|
$
|
(141
|
)
|
$
|
1,206
|
|
|
$
|
1,474
|
|
$
|
3
|
|
$
|
(197
|
)
|
$
|
1,280
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
1,537
|
|
|
$
|
4,038
|
|
Net income (loss)
|
—
|
|
(58
|
)
|
—
|
|
(58
|
)
|
|
—
|
|
(60
|
)
|
—
|
|
(60
|
)
|
|
142
|
|
|
—
|
|
|
191
|
|
|
215
|
|
||||||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
29
|
|
29
|
|
|
—
|
|
—
|
|
32
|
|
32
|
|
|
—
|
|
|
—
|
|
|
48
|
|
|
109
|
|
||||||||||||
Total comprehensive income (loss)
|
—
|
|
(58
|
)
|
29
|
|
(29
|
)
|
|
—
|
|
(60
|
)
|
32
|
|
(28
|
)
|
|
142
|
|
|
—
|
|
|
239
|
|
|
324
|
|
||||||||||||
Contributions
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
5
|
|
||||||||||||
Distributions (2)
|
—
|
|
(15
|
)
|
—
|
|
(15
|
)
|
|
—
|
|
(16
|
)
|
—
|
|
(16
|
)
|
|
(142
|
)
|
|
—
|
|
|
(388
|
)
|
|
(561
|
)
|
||||||||||||
Acquisition of Interest (3)
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,639
|
|
|
1,639
|
|
||||||||||||
Unit Issuance (2)
|
421
|
|
—
|
|
—
|
|
421
|
|
|
200
|
|
—
|
|
—
|
|
200
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
621
|
|
||||||||||||
Other
|
—
|
|
2
|
|
—
|
|
2
|
|
|
—
|
|
2
|
|
—
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
(2
|
)
|
||||||||||||
Balance as at December 31, 2017
|
$
|
1,766
|
|
$
|
(69
|
)
|
$
|
(112
|
)
|
$
|
1,585
|
|
|
$
|
1,674
|
|
$
|
(71
|
)
|
$
|
(165
|
)
|
$
|
1,438
|
|
|
$
|
—
|
|
|
$
|
15
|
|
|
$
|
3,026
|
|
|
$
|
6,064
|
|
(1)
|
See Note 21 for additional information.
|
(2)
|
See Note 20 for additional information on distributions as it relates to the Special Limited Partners and for additional information on the unit issuance.
|
(3)
|
See Note 3 for additional information.
|
F-10
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
Notes
|
|
2019
|
|
2018
|
|
2017
|
||||||
Operating Activities
|
|
|
|
|
|
|
|
||||||
Net income (loss)
|
|
|
$
|
434
|
|
|
$
|
1,203
|
|
|
$
|
215
|
|
Adjusted for the following items:
|
|
|
|
|
|
|
|
||||||
Equity accounted earnings, net of distributions
|
|
|
(52
|
)
|
|
19
|
|
|
(69
|
)
|
|||
Impairment expense, net
|
12, 14
|
|
609
|
|
|
218
|
|
|
39
|
|
|||
Depreciation and amortization expense
|
|
|
1,804
|
|
|
748
|
|
|
371
|
|
|||
Gain on acquisitions/dispositions, net
|
3, 9
|
|
(726
|
)
|
|
(500
|
)
|
|
(267
|
)
|
|||
Provisions and other items
|
|
|
110
|
|
|
10
|
|
|
114
|
|
|||
Deferred income tax expense (recovery)
|
19
|
|
(132
|
)
|
|
(88
|
)
|
|
(22
|
)
|
|||
Changes in non-cash working capital, net
|
30
|
|
116
|
|
|
(269
|
)
|
|
(451
|
)
|
|||
Cash from operating activities
|
|
|
2,163
|
|
|
1,341
|
|
|
(70
|
)
|
|||
Financing Activities
|
|
|
|
|
|
|
|
||||||
Proceeds from non-recourse borrowings in subsidiaries of the partnership
|
|
|
15,164
|
|
|
6,860
|
|
|
1,694
|
|
|||
Repayment of non-recourse borrowings in subsidiaries of the partnership
|
|
|
(3,786
|
)
|
|
(2,292
|
)
|
|
(1,345
|
)
|
|||
Proceeds from other financing
|
|
|
1,750
|
|
|
—
|
|
|
—
|
|
|||
Repayment of other financing
|
|
|
(42
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from other credit facilities, net
|
|
|
321
|
|
|
(48
|
)
|
|
360
|
|
|||
Lease liability repayment
|
|
|
(182
|
)
|
|
—
|
|
|
—
|
|
|||
Capital provided by limited partners and Redemption-Exchange Unitholders
|
20
|
|
815
|
|
|
—
|
|
|
621
|
|
|||
Capital provided by others who have interests in operating subsidiaries
|
|
|
4,151
|
|
|
1,395
|
|
|
897
|
|
|||
Capital paid to others who have interests in operating subsidiaries
|
|
|
(462
|
)
|
|
—
|
|
|
—
|
|
|||
Distributions to limited partners and Redemption-Exchange Unitholders
|
|
|
(35
|
)
|
|
(32
|
)
|
|
(31
|
)
|
|||
Distributions to Special Limited Partners Unitholders
|
|
|
—
|
|
|
(327
|
)
|
|
(95
|
)
|
|||
Distributions to others who have interests in operating subsidiaries
|
20
|
|
(1,769
|
)
|
|
(1,995
|
)
|
|
(388
|
)
|
|||
Cash from (used in) financing activities
|
|
|
15,925
|
|
|
3,561
|
|
|
1,713
|
|
|||
Investing Activities
|
|
|
|
|
|
|
|
||||||
Acquisitions
|
|
|
|
|
|
|
|
||||||
Subsidiaries, net of cash acquired
|
3
|
|
(18,498
|
)
|
|
(3,422
|
)
|
|
(1,668
|
)
|
|||
Property, plant and equipment and intangible assets
|
|
|
(1,205
|
)
|
|
(545
|
)
|
|
(240
|
)
|
|||
Equity accounted investments
|
|
|
(25
|
)
|
|
(9
|
)
|
|
(208
|
)
|
|||
Financial assets and other
|
|
|
(73
|
)
|
|
(465
|
)
|
|
(290
|
)
|
|||
Dispositions
|
|
|
|
|
|
|
|
||||||
Subsidiaries, net of cash disposed
|
|
|
1,393
|
|
|
—
|
|
|
383
|
|
|||
Property, plant and equipment
|
|
|
62
|
|
|
111
|
|
|
17
|
|
|||
Equity accounted investments
|
|
|
43
|
|
|
371
|
|
|
60
|
|
|||
Financial assets and other
|
|
|
262
|
|
|
8
|
|
|
259
|
|
|||
Net settlement of hedges
|
|
|
32
|
|
|
23
|
|
|
(12
|
)
|
|||
Restricted cash and deposits
|
|
|
70
|
|
|
(71
|
)
|
|
104
|
|
|||
Cash from (used in) investing activities
|
|
|
(17,939
|
)
|
|
(3,999
|
)
|
|
(1,595
|
)
|
|||
Cash
|
|
|
|
|
|
|
|
||||||
Change during the period
|
|
|
149
|
|
|
903
|
|
|
48
|
|
|||
Impact of foreign exchange on cash
|
|
|
(10
|
)
|
|
(60
|
)
|
|
8
|
|
|||
Net change in cash reclassified as assets held for sale
|
8
|
|
(102
|
)
|
|
—
|
|
|
—
|
|
|||
Balance, beginning of year
|
|
|
1,949
|
|
|
1,106
|
|
|
1,050
|
|
|||
Balance, end of year
|
|
|
$
|
1,986
|
|
|
$
|
1,949
|
|
|
$
|
1,106
|
|
F-11
|
Brookfield Business Partners
|
F-12
|
Brookfield Business Partners
|
F-13
|
Brookfield Business Partners
|
F-14
|
Brookfield Business Partners
|
Business type
|
|
Name of entity
|
|
Country of incorporation
|
|
Voting interest (%)
|
|
Economic interest (%)
|
||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
Business services
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Financial advisory services business
|
|
BFIN
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Residential real estate services business
|
|
Brookfield RPS Limited
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Construction services business
|
|
Multiplex
|
|
United Kingdom
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
F-15
|
Brookfield Business Partners
|
Business type
|
|
Name of entity
|
|
Country of incorporation
|
|
Voting interest (%)
|
|
Economic interest (%)
|
||||||||
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||
Business services
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Condominium management services business
|
|
Crossbridge Condominium Services Ltd.
|
|
Canada
|
|
90
|
%
|
|
90
|
%
|
|
90
|
%
|
|
90
|
%
|
IT storage facilities management business
|
|
WatServ
|
|
Canada
|
|
75
|
%
|
|
75
|
%
|
|
75
|
%
|
|
75
|
%
|
Fuel marketing business
|
|
BG Fuels
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
26
|
%
|
|
26
|
%
|
Cold storage logistics
|
|
Nova Cold Logistics
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
25
|
%
|
|
25
|
%
|
Road fuel distribution business
|
|
Greenergy Fuels Holding Limited
|
|
United Kingdom
|
|
85
|
%
|
|
85
|
%
|
|
14
|
%
|
|
14
|
%
|
Wireless broadband
|
|
Imagine Communications Group Limited
|
|
Ireland
|
|
55
|
%
|
|
55
|
%
|
|
31
|
%
|
|
31
|
%
|
Healthcare services
|
|
Healthscope Limited
|
|
Australia
|
|
100
|
%
|
|
—
|
%
|
|
27
|
%
|
|
—
|
%
|
Heavy equipment and light vehicle fleet management
|
|
Ouro Verde Locação e Seviços S.A.
|
|
Brazil
|
|
100
|
%
|
|
—
|
%
|
|
35
|
%
|
|
—
|
%
|
Mortgage insurance services
|
|
Genworth MI Canada Inc.
|
|
Canada
|
|
57
|
%
|
|
—
|
%
|
|
29
|
%
|
|
—
|
%
|
Infrastructure services
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Infrastructure services provider to the power generation industry
|
|
Westinghouse Electric Company
|
|
United States
|
|
100
|
%
|
|
100
|
%
|
|
44
|
%
|
|
44
|
%
|
Services provider to the offshore oil production industry
|
|
Teekay Offshore LP
|
|
United States
|
|
73
|
%
|
|
51
|
%
|
|
31
|
%
|
|
25
|
%
|
Industrials
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Limestone mining operations
|
|
Hammerstone Corporation
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
39
|
%
|
|
39
|
%
|
Graphite electrode manufacturing business
|
|
GrafTech International Ltd.
|
|
United States
|
|
74
|
%
|
|
79
|
%
|
|
25
|
%
|
|
27
|
%
|
Water and wastewater services
|
|
BRK Ambiental
|
|
Brazil
|
|
70
|
%
|
|
70
|
%
|
|
26
|
%
|
|
26
|
%
|
Infrastructure support products manufacturing operation
|
|
AP Infrastructure Solutions LP
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
25
|
%
|
|
25
|
%
|
Provider of returnable plastic packaging
|
|
Schoeller Allibert Group B.V.
|
|
Netherlands
|
|
52
|
%
|
|
52
|
%
|
|
14
|
%
|
|
14
|
%
|
Canadian well-servicing operation
|
|
CWC Energy Services Corp.
|
|
Canada
|
|
80
|
%
|
|
78
|
%
|
|
54
|
%
|
|
56
|
%
|
Canadian energy operation
|
|
Ember Resources Inc.
|
|
Canada
|
|
100
|
%
|
|
100
|
%
|
|
46
|
%
|
|
41
|
%
|
Automotive batteries
|
|
Clarios Global LP
|
|
United States
|
|
100
|
%
|
|
—
|
%
|
|
28
|
%
|
|
—
|
%
|
F-16
|
Brookfield Business Partners
|
F-17
|
Brookfield Business Partners
|
F-18
|
Brookfield Business Partners
|
Buildings
|
Up to 50 years
|
Leasehold improvements
|
Up to 40 years but not exceeding the term of the lease
|
Machinery and equipment
|
Up to 20 years
|
Vessels
|
Up to 35 years
|
Oil and gas related equipment
|
Units of production
|
F-19
|
Brookfield Business Partners
|
Water and sewage concession rights
|
Up to 40 years
|
Brand names
|
Up to 20 years
|
Computer software
|
Up to 10 years
|
Customer relationships
|
Up to 30 years
|
Value of insurance contracts acquired
|
Up to 15 years
|
Patents and trademarks
|
Up to 40 years
|
Proprietary technology
|
Up to 20 years
|
Product development costs
|
Up to 5 years
|
Distribution networks
|
Up to 25 years
|
Loyalty program
|
Up to 15 years
|
F-20
|
Brookfield Business Partners
|
F-21
|
Brookfield Business Partners
|
•
|
Home Sale: The partnership earns home sale revenue from two types of contracts: cost-plus home sale and fixed fee home sale contracts. Under a cost-plus home sale contract, the partnership earns a performance fee and bears no risk of loss with respect to costs incurred. Revenues and related costs associated with the purchase and resale of residences under cost-plus contracts are recognized on a net basis over the period in which services are provided as the partnership does not have control over the home prior to transfer to the customer. Under a fixed fee home sale contract, the partnership earns a fixed fee based upon a percentage of the acquisition cost of the residential property. This fee revenue is recognized when title is transferred to the customer as the partnership’s performance obligation is complete at this time. The revenues and expenses related to the home sale itself are recorded on a gross basis.
|
•
|
Referral fees: The partnership earns referral fees from various suppliers who provide services to customers through our service offerings. A significant portion of the referral fee revenue is generated from the closing of a home sale or purchase transaction, under which the partnership earns a percentage of the commissions received by the real estate agent on the purchase or sale of a home by the customer. Referral fees from home purchases or sales are recognized upon the closing date of the real estate transaction. The partnership recognizes referral fees from other suppliers upon completion of the services.
|
F-22
|
Brookfield Business Partners
|
•
|
FPSO contracts: Pursuant to an FPSO contract, the partnership charters an FPSO unit to a customer for a fixed period of time, generally more than one year. The performance obligations within an FPSO contract, which will include the use of the FPSO unit to the charterer as well as the operation of the FPSO unit, are satisfied as services are rendered over the duration of such contract, as measured using the time that has elapsed from commencement of performance.
|
•
|
Contracts of Affreightment: Voyages performed pursuant to a CoA for the partnership’s shuttle tankers are priced based on the pre-agreed terms in the CoA. The performance obligations within a voyage performed pursuant to a CoA, which typically include the use of the vessel to the charterer as well as the operation of the vessel, are satisfied as services are rendered over the duration of the voyage, as measured using the time that has elapsed from commencement of performance. The duration of a single voyage will typically be less than two weeks.
|
F-23
|
Brookfield Business Partners
|
|
|
IFRS 9 Measurement Category
|
|
Statement of Financial
Position Account
|
Financial assets
|
|
|
|
|
Cash and cash equivalents
|
|
Amortized cost
|
|
Cash and cash equivalents
|
Accounts receivable
|
|
Amortized cost / FVTPL
|
|
Accounts and other receivable, net
|
Restricted cash
|
|
Amortized cost
|
|
Financial assets
|
Equity securities
|
|
FVTPL / FVOCI
|
|
Financial assets
|
Debt securities
|
|
FVTPL / FVOCI / Amortized cost
|
|
Financial assets
|
Derivative assets
|
|
FVTPL (1)
|
|
Financial assets
|
Other financial assets
|
|
Amortized cost / FVTPL / FVOCI
|
|
Financial assets
|
Financial liabilities
|
|
|
|
|
Borrowings
|
|
Amortized cost
|
|
Borrowings
|
Accounts payable and other
|
|
Amortized cost
|
|
Accounts payable and other
|
Derivative liabilities
|
|
FVTPL (1)
|
|
Accounts payable and other
|
(1)
|
Derivatives are classified and measured at FVTPL except those designated in hedging relationships.
|
F-24
|
Brookfield Business Partners
|
F-25
|
Brookfield Business Partners
|
Level 1 -
|
Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
|
Level 2 -
|
Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the asset’s or liability’s anticipated life.
|
Level 3 -
|
Inputs are unobservable and reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs in determining the estimate.
|
F-26
|
Brookfield Business Partners
|
F-27
|
Brookfield Business Partners
|
F-28
|
Brookfield Business Partners
|
F-29
|
Brookfield Business Partners
|
F-30
|
Brookfield Business Partners
|
F-31
|
Brookfield Business Partners
|
•
|
a current, unbiased probability-weighted estimate of future cash flows expected to arise as the insurer fulfills the contract;
|
•
|
the effect of the time value of money;
|
•
|
a risk adjustment that measures the effects of uncertainty about the amount and timing of future cash flows; and
|
•
|
a contractual service margin which represents the unearned profit in a contract and that is recognized in profit or loss over time as the insurance coverage is provided.
|
F-32
|
Brookfield Business Partners
|
•
|
To recognize the payments associated with short-term and low value leases on a straight-line basis as an operating expense on a straight-line basis over the term of the lease unless another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed; and
|
•
|
To not allocate contract consideration between lease and non-lease components, but rather account for each lease and non-lease component as a single lease component, on a lease-by-lease basis.
|
F-33
|
Brookfield Business Partners
|
•
|
The accounting for operating leases with a remaining lease term of less than 12 months as of January 1, 2019 as short-term leases;
|
•
|
The application of a single discount rate to a portfolio of leases with reasonably similar characteristics;
|
•
|
The application of the policy choice option on adoption to measure the right-of-use assets at an amount equal to the lease liabilities, adjusted for any prepaid or accrued lease payments;
|
•
|
The reliance on our assessments of whether leases are onerous applied IAS 37, immediately before January 1, 2019, instead of performing an impairment review; and
|
•
|
The use of hindsight in determining the lease term if the contract contains options to extend or terminate the lease.
|
F-34
|
Brookfield Business Partners
|
(a)
|
Acquisitions completed in 2019
|
F-35
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Total (1)
|
||||||||
Cash
|
|
$
|
2,024
|
|
|
$
|
7
|
|
|
$
|
3,764
|
|
|
$
|
5,795
|
|
Non-cash consideration
|
|
15
|
|
|
1
|
|
|
—
|
|
|
16
|
|
||||
Total consideration (2)
|
|
$
|
2,039
|
|
|
$
|
8
|
|
|
$
|
3,764
|
|
|
$
|
5,811
|
|
|
|
|
|
|
|
|
|
|
||||||||
(US$ MILLIONS)
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
319
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
330
|
|
Accounts and other receivable, net
|
|
297
|
|
|
2
|
|
|
1,129
|
|
|
1,428
|
|
||||
Inventory, net
|
|
41
|
|
|
—
|
|
|
1,775
|
|
|
1,816
|
|
||||
Assets held for sale
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||
Equity accounted investments
|
|
9
|
|
|
—
|
|
|
838
|
|
|
847
|
|
||||
Property, plant and equipment
|
|
3,030
|
|
|
3
|
|
|
3,582
|
|
|
6,615
|
|
||||
Intangible assets
|
|
535
|
|
|
—
|
|
|
6,420
|
|
|
6,955
|
|
||||
Goodwill (5)
|
|
1,572
|
|
|
12
|
|
|
1,894
|
|
|
3,478
|
|
||||
Deferred income tax assets
|
|
136
|
|
|
—
|
|
|
181
|
|
|
317
|
|
||||
Financial assets
|
|
4,735
|
|
|
—
|
|
|
27
|
|
|
4,762
|
|
||||
Other assets
|
|
48
|
|
|
—
|
|
|
347
|
|
|
395
|
|
||||
Acquisition gain
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||
Accounts payable and other
|
|
(2,732
|
)
|
|
(1
|
)
|
|
(1,998
|
)
|
|
(4,731
|
)
|
||||
Borrowings
|
|
(709
|
)
|
|
—
|
|
|
—
|
|
|
(709
|
)
|
||||
Deferred income tax liabilities
|
|
(150
|
)
|
|
—
|
|
|
(967
|
)
|
|
(1,117
|
)
|
||||
Net assets acquired before non-controlling interests
|
|
7,133
|
|
|
16
|
|
|
13,239
|
|
|
20,388
|
|
||||
Non-controlling interests (3) (4)
|
|
(5,094
|
)
|
|
(8
|
)
|
|
(9,475
|
)
|
|
(14,577
|
)
|
||||
Net assets acquired
|
|
$
|
2,039
|
|
|
$
|
8
|
|
|
$
|
3,764
|
|
|
$
|
5,811
|
|
(1)
|
The initial fair values of acquired assets, liabilities and goodwill for the acquisitions have been determined on a preliminary basis at the end of the reporting period. Specifically, within the industrials segment, the partnership is in ongoing negotiations which could result in a change in fair value estimates related to working capital and goodwill.
|
(2)
|
Excludes consideration attributable to non-controlling interests, which represents the interest of others in operating subsidiaries.
|
(3)
|
Non-controlling interests recognized on business combination were measured at fair value for business services, industrials and infrastructure services.
|
(4)
|
Non-controlling interests recognized on business combination were measured at the proportionate share of fair value of the assets acquired and liabilities assumed for mortgage insurance services in our business services segment.
|
(5)
|
Adjustments to purchase price allocations within our business services segment and industrials segment resulted in an increase to goodwill of $98 million and $159 million, respectively.
|
F-36
|
Brookfield Business Partners
|
F-37
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
Business services (1)
|
|
Infrastructure services (2)
|
|
Industrials
|
|
Total
|
||||||||
Cash
|
$
|
25
|
|
|
1,764
|
|
|
$
|
45
|
|
|
$
|
1,834
|
|
|
Non-cash consideration
|
—
|
|
|
275
|
|
|
—
|
|
|
275
|
|
||||
Total consideration (3)
|
$
|
25
|
|
|
$
|
2,039
|
|
|
$
|
45
|
|
|
$
|
2,109
|
|
|
|
|
|
|
|
|
|
||||||||
(US$ MILLIONS)
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
36
|
|
|
592
|
|
|
$
|
30
|
|
|
$
|
658
|
|
|
Accounts receivable and other, net
|
11
|
|
|
786
|
|
|
75
|
|
|
872
|
|
||||
Inventory, net
|
2
|
|
|
626
|
|
|
58
|
|
|
686
|
|
||||
Equity accounted investments
|
—
|
|
|
328
|
|
|
1
|
|
|
329
|
|
||||
Property, plant and equipment
|
56
|
|
|
4,631
|
|
|
187
|
|
|
4,874
|
|
||||
Intangible assets
|
28
|
|
|
2,544
|
|
|
231
|
|
|
2,803
|
|
||||
Goodwill
|
36
|
|
|
721
|
|
|
180
|
|
|
937
|
|
||||
Deferred income tax assets
|
—
|
|
|
11
|
|
|
27
|
|
|
38
|
|
||||
Financial assets
|
—
|
|
|
410
|
|
|
2
|
|
|
412
|
|
||||
Other assets
|
—
|
|
|
1,234
|
|
|
—
|
|
|
1,234
|
|
||||
Accounts payable and other
|
(28
|
)
|
|
(3,290
|
)
|
|
(199
|
)
|
|
(3,517
|
)
|
||||
Borrowings
|
(50
|
)
|
|
(3,352
|
)
|
|
(266
|
)
|
|
(3,668
|
)
|
||||
Deferred income tax liabilities
|
(2
|
)
|
|
(82
|
)
|
|
(72
|
)
|
|
(156
|
)
|
||||
Net assets acquired before non-controlling interests
|
89
|
|
|
5,159
|
|
|
254
|
|
|
5,502
|
|
||||
Non-controlling interests (4) (5)
|
(64
|
)
|
|
(3,120
|
)
|
|
(209
|
)
|
|
(3,393
|
)
|
||||
Net assets acquired
|
$
|
25
|
|
|
$
|
2,039
|
|
|
$
|
45
|
|
|
$
|
2,109
|
|
(1)
|
Adjustments to a purchase price allocation within our business services segment resulted in a $5 million increase to goodwill.
|
(2)
|
Adjustments to a purchase price allocation within our infrastructure services segment resulted in a decrease in accounts receivable and other of $50 million, a decrease in property, plant and equipment of $38 million, a decrease in intangible assets of $139 million, a decrease in goodwill of $39 million, an increase of financial assets of $93 million, an increase in other assets of $208 million, a decrease in accounts payable and other of $141 million, and a decrease in deferred income tax liabilities of $1 million.
|
(3)
|
Excludes consideration attributable to non-controlling interests, which represents the interest of others in operating subsidiaries.
|
(4)
|
Non-controlling interests recognized on business combination were measured at fair value for business services and infrastructure services.
|
(5)
|
Non-controlling interests recognized on business combination were measured at the proportionate share of fair value of the assets acquired and liabilities assumed for industrials.
|
F-38
|
Brookfield Business Partners
|
F-39
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
December 31, 2018
|
||
Fair value of investment immediately before acquiring control
|
|
$
|
651
|
|
Less: carrying value of investment immediately before acquisition
|
|
447
|
|
|
Add: amounts recognized in OCI (1)
|
|
2
|
|
|
Remeasurement gain
|
|
$
|
206
|
|
Gain on extinguishment (2)
|
|
44
|
|
|
Gain (loss) on acquisitions/dispositions, net
|
|
$
|
250
|
|
Total gain on acquisition attributable to non-controlling interests
|
|
$
|
135
|
|
Total gain on acquisition attributable to the partnership
|
|
$
|
115
|
|
(1)
|
Included in carrying value of the investment immediately before acquisition.
|
(2)
|
The partnership recognized a total gain on extinguishment of $44 million at the subsidiary level ($18 million on debt and $26 million on warrants).
|
F-40
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
|
|
|
|
|
|
|
||||||||
MEASUREMENT BASIS
|
|
FVTPL
|
|
FVOCI
|
|
Amortized cost
|
|
Total
|
||||||||
Financial assets
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,986
|
|
|
$
|
1,986
|
|
Accounts receivable, net (current and non-current)
|
|
—
|
|
|
—
|
|
|
5,631
|
|
|
5,631
|
|
||||
Other assets (current and non-current) (1)
|
|
—
|
|
|
—
|
|
|
577
|
|
|
577
|
|
||||
Financial assets (current and non-current) (2)
|
|
883
|
|
|
4,612
|
|
|
748
|
|
|
6,243
|
|
||||
Total (3)
|
|
$
|
883
|
|
|
$
|
4,612
|
|
|
$
|
8,942
|
|
|
$
|
14,437
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
||||||||
Accounts payable and other (2) (4)
|
|
$
|
385
|
|
|
$
|
159
|
|
|
$
|
9,039
|
|
|
$
|
9,583
|
|
Borrowings (current and non-current)
|
|
—
|
|
|
—
|
|
|
22,399
|
|
|
22,399
|
|
||||
Total
|
|
$
|
385
|
|
|
$
|
159
|
|
|
$
|
31,438
|
|
|
$
|
31,982
|
|
(1)
|
Excludes prepayments, subrogation recoverable and other assets of $1,215 million.
|
(2)
|
Refer to Hedging Activities in Note 4 (a) below.
|
(3)
|
Total financial assets include $3,832 million of assets pledged as collateral.
|
(4)
|
Excludes provisions, decommissioning liabilities, deferred revenue, unearned premium reserve, work in progress, post-employment benefits, liabilities held for sale and various tax and duties of $6,913 million.
|
F-41
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
|
|
|
|
|
|
|
||||||||
MEASUREMENT BASIS
|
|
FVTPL
|
|
FVOCI
|
|
Amortized cost
|
|
Total
|
||||||||
Financial assets
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,949
|
|
|
$
|
1,949
|
|
Accounts receivable, net (current and non-current) (1)
|
|
67
|
|
|
—
|
|
|
5,093
|
|
|
5,160
|
|
||||
Other assets (current and non-current) (2)
|
|
—
|
|
|
—
|
|
|
563
|
|
|
563
|
|
||||
Financial assets (current and non-current) (3)
|
|
413
|
|
|
376
|
|
|
580
|
|
|
1,369
|
|
||||
Total (4)
|
|
$
|
480
|
|
|
$
|
376
|
|
|
$
|
8,185
|
|
|
$
|
9,041
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accounts payable and other (5)
|
|
$
|
311
|
|
|
$
|
48
|
|
|
$
|
4,679
|
|
|
$
|
5,038
|
|
Borrowings (current and non-current)
|
|
—
|
|
|
—
|
|
|
10,866
|
|
|
10,866
|
|
||||
Total
|
|
$
|
311
|
|
|
$
|
48
|
|
|
$
|
15,545
|
|
|
$
|
15,904
|
|
(1)
|
Accounts receivable recognized at fair value relates to the partnership’s mining business.
|
(2)
|
Excludes prepayments and other assets of $950 million.
|
(3)
|
Refer to Hedging Activities in Note 4 (a) below.
|
(4)
|
Total financial assets include $3,509 million of assets pledged as collateral.
|
(5)
|
Excludes provisions, decommissioning liabilities, deferred revenue, work in progress, post-employment benefits and various tax and duties of $4,044 million.
|
F-42
|
Brookfield Business Partners
|
|
|
2019
|
|
2018
|
||||||||||||||||||||
(US$ MILLIONS)
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||||
Financial assets
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Common shares
|
|
$
|
255
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
266
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Corporate and government bonds
|
|
—
|
|
|
3,914
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Accounts receivable
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67
|
|
|
—
|
|
||||||
Derivative assets
|
|
4
|
|
|
234
|
|
|
—
|
|
|
41
|
|
|
202
|
|
|
—
|
|
||||||
Other financial assets (1)
|
|
401
|
|
|
400
|
|
|
287
|
|
|
—
|
|
|
—
|
|
|
280
|
|
||||||
|
|
$
|
660
|
|
|
$
|
4,548
|
|
|
$
|
287
|
|
|
$
|
307
|
|
|
$
|
269
|
|
|
$
|
280
|
|
Financial liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Derivative liabilities
|
|
$
|
18
|
|
|
$
|
489
|
|
|
$
|
—
|
|
|
$
|
13
|
|
|
$
|
296
|
|
|
$
|
13
|
|
Other financial liabilities
|
|
—
|
|
|
—
|
|
|
36
|
|
|
—
|
|
|
—
|
|
|
37
|
|
||||||
|
|
$
|
18
|
|
|
$
|
489
|
|
|
$
|
36
|
|
|
$
|
13
|
|
|
$
|
296
|
|
|
$
|
50
|
|
F-43
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
2019
|
|
2018
|
||||
Balance at beginning of year
|
$
|
280
|
|
|
$
|
257
|
|
Fair value change recorded in net income
|
5
|
|
|
17
|
|
||
Fair value change recorded in other comprehensive income
|
2
|
|
|
(2
|
)
|
||
Additions (1)
|
—
|
|
|
49
|
|
||
Disposals
|
—
|
|
|
(41
|
)
|
||
Balance at end of period
|
$
|
287
|
|
|
$
|
280
|
|
(1)
|
In 2018, $49 million of the additions relate to a secured debenture investment in a homebuilding company.
|
F-44
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Current
|
|
|
|
|
||||
Marketable securities
|
|
$
|
734
|
|
|
$
|
265
|
|
Restricted cash
|
|
172
|
|
|
376
|
|
||
Derivative contracts
|
|
176
|
|
|
223
|
|
||
Loans and notes receivable
|
|
66
|
|
|
22
|
|
||
Total current
|
|
$
|
1,148
|
|
|
$
|
886
|
|
Non-current
|
|
|
|
|
||||
Marketable securities
|
|
$
|
3,435
|
|
|
$
|
1
|
|
Restricted cash
|
|
201
|
|
|
32
|
|
||
Derivative contracts
|
|
62
|
|
|
20
|
|
||
Loans and notes receivable
|
|
309
|
|
|
150
|
|
||
Other financial assets (1)
|
|
1,088
|
|
|
280
|
|
||
Total non-current
|
|
$
|
5,095
|
|
|
$
|
483
|
|
(1)
|
Other financial assets includes secured debentures to homebuilding companies in our business services segment, as well as asset backed securities and preferred shares in our business services segment.
|
F-45
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Current, net
|
|
$
|
4,808
|
|
|
$
|
4,307
|
|
Non-current, net
|
|
|
|
|
||||
Accounts receivable
|
|
40
|
|
|
37
|
|
||
Retainer on customer contracts
|
|
102
|
|
|
103
|
|
||
Billing rights
|
|
681
|
|
|
713
|
|
||
Total non-current, net
|
|
$
|
823
|
|
|
$
|
853
|
|
Total (1)
|
|
$
|
5,631
|
|
|
$
|
5,160
|
|
(1)
|
Refer to Note 17 for additional information.
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Loss allowance - beginning
|
|
$
|
45
|
|
|
$
|
40
|
|
|
$
|
7
|
|
Add: increase in allowance
|
|
53
|
|
|
22
|
|
|
39
|
|
|||
Deduct: bad debt write offs
|
|
(23
|
)
|
|
(10
|
)
|
|
(6
|
)
|
|||
Foreign currency translation
|
|
11
|
|
|
(7
|
)
|
|
—
|
|
|||
Loss allowance - ending
|
|
$
|
86
|
|
|
$
|
45
|
|
|
$
|
40
|
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Raw materials and consumables
|
|
$
|
941
|
|
|
$
|
605
|
|
Fuel products (1)
|
|
688
|
|
|
490
|
|
||
Work in progress
|
|
674
|
|
|
258
|
|
||
RTFO certificates (2)
|
|
342
|
|
|
95
|
|
||
Finished goods and other (3)
|
|
845
|
|
|
114
|
|
||
Carrying amount of inventories
|
|
$
|
3,490
|
|
|
$
|
1,562
|
|
(1)
|
Fuel products are traded in active markets and are purchased with a view to resale in the near future. As a result, stocks of fuel products are recorded at fair value based on quoted market prices.
|
(2)
|
$66 million of RTFO certificates are held for trading and recorded at fair value (2018: $nil). There is no externally quoted marketplace for the valuation of RTFO certificates. In order to value these contracts, the partnership has adopted a pricing methodology combining both observable inputs based on market data and assumptions developed internally based on observable market activity.
|
(3)
|
Finished goods and other are mainly composed of finished goods inventory in the infrastructure services and industrials segments.
|
F-46
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Inventory obsolescence provision - beginning
|
|
$
|
19
|
|
|
$
|
4
|
|
|
$
|
9
|
|
Add: increase in provision
|
|
22
|
|
|
22
|
|
|
1
|
|
|||
Deduct: inventory obsolescence write off
|
|
(8
|
)
|
|
(7
|
)
|
|
(6
|
)
|
|||
Inventory obsolescence provision - ending
|
|
$
|
33
|
|
|
$
|
19
|
|
|
$
|
4
|
|
F-47
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Current
|
|
|
|
|
||||
Work in progress (1)
|
|
$
|
505
|
|
|
$
|
506
|
|
Prepayments and other assets
|
|
719
|
|
|
508
|
|
||
Assets held for sale (2)
|
|
139
|
|
|
63
|
|
||
Total current
|
|
$
|
1,363
|
|
|
$
|
1,077
|
|
Non-current
|
|
|
|
|
||||
Work in progress (1)
|
|
$
|
72
|
|
|
$
|
57
|
|
Prepayments and other assets
|
|
357
|
|
|
442
|
|
||
Total non-current
|
|
$
|
429
|
|
|
$
|
499
|
|
(1)
|
See Note 17 for additional information.
|
(2)
|
Includes assets from our cold storage logistics business in our business services segment that have been classified as held for sale. See Note 8 for additional information.
|
F-48
|
Brookfield Business Partners
|
|
Year Ended December 31, 2019
|
||||||||||||||||||||||||||||||||||||||
|
Total
|
Profit/(loss) allocated to others ownership interest
|
|
Distributions to others ownership interest
|
|
Equity to others ownership interest
|
|||||||||||||||||||||||||||||||||
(US$ MILLIONS)
|
Current assets
|
|
Non-current assets
|
|
Current liabilities
|
|
Non-current liabilities
|
|
Revenue
|
|
Profit/(loss)
|
|
OCI
|
|
|||||||||||||||||||||||||
Business services
|
$
|
3,743
|
|
|
$
|
11,388
|
|
|
$
|
4,448
|
|
|
$
|
6,247
|
|
|
$
|
23,773
|
|
|
$
|
200
|
|
|
$
|
35
|
|
|
$
|
111
|
|
|
$
|
(368
|
)
|
|
$
|
3,166
|
|
Infrastructure services
|
2,358
|
|
|
8,262
|
|
|
2,289
|
|
|
7,028
|
|
|
4,559
|
|
|
(446
|
)
|
|
(138
|
)
|
|
(281
|
)
|
|
(370
|
)
|
|
833
|
|
||||||||||
Industrials
|
4,622
|
|
|
17,864
|
|
|
2,729
|
|
|
15,815
|
|
|
9,644
|
|
|
660
|
|
|
(104
|
)
|
|
502
|
|
|
(936
|
)
|
|
2,968
|
|
||||||||||
Total
|
$
|
10,723
|
|
|
$
|
37,514
|
|
|
$
|
9,466
|
|
|
$
|
29,090
|
|
|
$
|
37,976
|
|
|
$
|
414
|
|
|
$
|
(207
|
)
|
|
$
|
332
|
|
|
$
|
(1,674
|
)
|
|
$
|
6,967
|
|
|
Year Ended December 31, 2018
|
||||||||||||||||||||||||||||||||||||||
|
Total
|
Profit/(loss) allocated to others ownership interest
|
|
Distributions to others ownership interest
|
|
Equity to others ownership interest
|
|||||||||||||||||||||||||||||||||
(US$ MILLIONS)
|
Current assets
|
|
Non-current assets
|
|
Current liabilities
|
|
Non-current liabilities
|
|
Revenue
|
|
Profit/(loss)
|
|
OCI
|
|
|||||||||||||||||||||||||
Business services
|
$
|
2,413
|
|
|
$
|
1,773
|
|
|
$
|
3,113
|
|
|
$
|
475
|
|
|
$
|
25,785
|
|
|
$
|
(20
|
)
|
|
$
|
4
|
|
|
$
|
(20
|
)
|
|
$
|
(46
|
)
|
|
$
|
424
|
|
Infrastructure services
|
2,889
|
|
|
8,750
|
|
|
2,921
|
|
|
6,208
|
|
|
2,419
|
|
|
282
|
|
|
(121
|
)
|
|
170
|
|
|
(16
|
)
|
|
1,534
|
|
||||||||||
Industrials
|
1,991
|
|
|
5,656
|
|
|
1,040
|
|
|
4,823
|
|
|
3,894
|
|
|
895
|
|
|
(239
|
)
|
|
612
|
|
|
(1,542
|
)
|
|
1,425
|
|
||||||||||
Total
|
$
|
7,293
|
|
|
$
|
16,179
|
|
|
$
|
7,074
|
|
|
$
|
11,506
|
|
|
$
|
32,098
|
|
|
$
|
1,157
|
|
|
$
|
(356
|
)
|
|
$
|
762
|
|
|
$
|
(1,604
|
)
|
|
$
|
3,383
|
|
|
Year Ended December 31, 2017
|
||||||||||||||||||||||||||||||||||||||
|
Total
|
Profit/(loss) allocated to others ownership interest
|
|
Distributions to others ownership interest
|
|
Equity to others ownership interest
|
|||||||||||||||||||||||||||||||||
(US$ MILLIONS)
|
Current assets
|
|
Non-current assets
|
|
Current liabilities
|
|
Non-current liabilities
|
|
Revenue
|
|
Profit/(loss)
|
|
OCI
|
|
|||||||||||||||||||||||||
Business services
|
$
|
2,606
|
|
|
$
|
1,744
|
|
|
$
|
2,774
|
|
|
$
|
948
|
|
|
$
|
15,676
|
|
|
$
|
45
|
|
|
$
|
11
|
|
|
$
|
35
|
|
|
$
|
46
|
|
|
$
|
476
|
|
Industrials
|
1,095
|
|
|
5,812
|
|
|
904
|
|
|
2,731
|
|
|
1,913
|
|
|
(4
|
)
|
|
41
|
|
|
4
|
|
|
25
|
|
|
2,338
|
|
||||||||||
Total
|
$
|
3,701
|
|
|
$
|
7,556
|
|
|
$
|
3,678
|
|
|
$
|
3,679
|
|
|
$
|
17,589
|
|
|
$
|
41
|
|
|
$
|
52
|
|
|
$
|
39
|
|
|
$
|
71
|
|
|
$
|
2,814
|
|
F-49
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
NCI related to material non-wholly owned subsidiaries
|
|
|
|
|
||||
Business services
|
|
$
|
3,166
|
|
|
$
|
424
|
|
Infrastructure services
|
|
833
|
|
|
1,534
|
|
||
Industrials
|
|
2,968
|
|
|
1,425
|
|
||
Total NCI in material non-wholly owned subsidiaries
|
|
$
|
6,967
|
|
|
$
|
3,383
|
|
Total individually immaterial NCI balances
|
|
294
|
|
|
148
|
|
||
Total NCI
|
|
$
|
7,261
|
|
|
$
|
3,531
|
|
F-50
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Land
|
|
Building
|
|
Machinery and equipment
|
|
Mineral property assets and oil and gas properties
|
|
Vessels
|
|
Others
|
|
Right-of-use assets
|
|
Total assets
|
||||||||||||||||
Gross Carrying Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at January 1, 2018
|
|
$
|
103
|
|
|
$
|
397
|
|
|
$
|
1,310
|
|
|
$
|
1,516
|
|
|
$
|
—
|
|
|
$
|
99
|
|
|
$
|
—
|
|
|
$
|
3,425
|
|
Additions (cash and non-cash)
|
|
1
|
|
|
37
|
|
|
301
|
|
|
64
|
|
|
86
|
|
|
11
|
|
|
—
|
|
|
500
|
|
||||||||
Dispositions
|
|
(3
|
)
|
|
(5
|
)
|
|
(95
|
)
|
|
(2
|
)
|
|
(19
|
)
|
|
(7
|
)
|
|
—
|
|
|
(131
|
)
|
||||||||
Acquisitions through business combinations (1)
|
|
44
|
|
|
262
|
|
|
801
|
|
|
—
|
|
|
3,738
|
|
|
68
|
|
|
—
|
|
|
4,913
|
|
||||||||
Transfers and assets reclassified as held for sale (2)
|
|
(12
|
)
|
|
(2
|
)
|
|
(13
|
)
|
|
1
|
|
|
(13
|
)
|
|
1
|
|
|
—
|
|
|
(38
|
)
|
||||||||
Foreign currency translation
|
|
(6
|
)
|
|
(40
|
)
|
|
(81
|
)
|
|
(119
|
)
|
|
—
|
|
|
(8
|
)
|
|
—
|
|
|
(254
|
)
|
||||||||
Balance at December 31, 2018
|
|
$
|
127
|
|
|
$
|
649
|
|
|
$
|
2,223
|
|
|
$
|
1,460
|
|
|
$
|
3,792
|
|
|
$
|
164
|
|
|
$
|
—
|
|
|
$
|
8,415
|
|
Additions (cash and non-cash)
|
|
1
|
|
|
346
|
|
|
582
|
|
|
88
|
|
|
210
|
|
|
69
|
|
|
233
|
|
|
1,529
|
|
||||||||
Dispositions
|
|
(1
|
)
|
|
(78
|
)
|
|
(266
|
)
|
|
(345
|
)
|
|
—
|
|
|
(23
|
)
|
|
(59
|
)
|
|
(772
|
)
|
||||||||
Acquisitions through business combinations (1)
|
|
523
|
|
|
2,886
|
|
|
2,677
|
|
|
—
|
|
|
—
|
|
|
263
|
|
|
228
|
|
|
6,577
|
|
||||||||
Transfers and assets reclassified as held for sale (2)
|
|
(22
|
)
|
|
(107
|
)
|
|
(178
|
)
|
|
—
|
|
|
(31
|
)
|
|
(54
|
)
|
|
60
|
|
|
(332
|
)
|
||||||||
Changes in accounting policy
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
978
|
|
|
978
|
|
||||||||
Foreign currency translation
|
|
5
|
|
|
12
|
|
|
(3
|
)
|
|
69
|
|
|
(1
|
)
|
|
2
|
|
|
23
|
|
|
107
|
|
||||||||
Balances at December 31, 2019
|
|
$
|
633
|
|
|
$
|
3,708
|
|
|
$
|
5,035
|
|
|
$
|
1,272
|
|
|
$
|
3,970
|
|
|
$
|
421
|
|
|
$
|
1,463
|
|
|
$
|
16,502
|
|
Accumulated Depreciation and Impairment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at January 1, 2018
|
|
$
|
—
|
|
|
$
|
(44
|
)
|
|
$
|
(364
|
)
|
|
$
|
(450
|
)
|
|
$
|
—
|
|
|
$
|
(37
|
)
|
|
—
|
|
|
(895
|
)
|
||
Depreciation/depletion/impairment expense
|
|
—
|
|
|
(28
|
)
|
|
(192
|
)
|
|
(306
|
)
|
|
(182
|
)
|
|
(12
|
)
|
|
—
|
|
|
(720
|
)
|
||||||||
Dispositions
|
|
—
|
|
|
1
|
|
|
55
|
|
|
—
|
|
|
3
|
|
|
3
|
|
|
—
|
|
|
62
|
|
||||||||
Transfers and assets reclassified as held for sale (2)
|
|
—
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
2
|
|
||||||||
Foreign currency translation
|
|
—
|
|
|
5
|
|
|
23
|
|
|
50
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
83
|
|
||||||||
Balances at December 31, 2018 (3) (4)
|
|
$
|
—
|
|
|
$
|
(65
|
)
|
|
$
|
(476
|
)
|
|
$
|
(706
|
)
|
|
$
|
(179
|
)
|
|
$
|
(42
|
)
|
|
$
|
—
|
|
|
$
|
(1,468
|
)
|
Depreciation/depletion/impairment expense
|
|
—
|
|
|
(80
|
)
|
|
(485
|
)
|
|
(61
|
)
|
|
(530
|
)
|
|
(48
|
)
|
|
(203
|
)
|
|
(1,407
|
)
|
||||||||
Dispositions
|
|
—
|
|
|
21
|
|
|
123
|
|
|
81
|
|
|
—
|
|
|
14
|
|
|
24
|
|
|
263
|
|
||||||||
Transfers and assets reclassified as held for sale (2)
|
|
—
|
|
|
17
|
|
|
53
|
|
|
—
|
|
|
3
|
|
|
4
|
|
|
(15
|
)
|
|
62
|
|
||||||||
Foreign currency translation
|
|
—
|
|
|
1
|
|
|
(24
|
)
|
|
(36
|
)
|
|
1
|
|
|
1
|
|
|
(3
|
)
|
|
(60
|
)
|
||||||||
Balances at December 31, 2019 (3) (4)
|
|
$
|
—
|
|
|
$
|
(106
|
)
|
|
$
|
(809
|
)
|
|
$
|
(722
|
)
|
|
$
|
(705
|
)
|
|
$
|
(71
|
)
|
|
$
|
(197
|
)
|
|
$
|
(2,610
|
)
|
Net book value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2018
|
|
$
|
127
|
|
|
$
|
584
|
|
|
$
|
1,747
|
|
|
$
|
754
|
|
|
$
|
3,613
|
|
|
$
|
122
|
|
|
$
|
—
|
|
|
$
|
6,947
|
|
December 31, 2019
|
|
$
|
633
|
|
|
$
|
3,602
|
|
|
$
|
4,226
|
|
|
$
|
550
|
|
|
$
|
3,265
|
|
|
$
|
350
|
|
|
$
|
1,266
|
|
|
$
|
13,892
|
|
(1)
|
See Note 3 for additional information.
|
(2)
|
Includes assets that were reclassified as held for sale and subsequently disposed. See Note 8 and Note 9 for additional information.
|
(3)
|
Includes accumulated impairment losses of $14 million (2018: $5 million) for machinery and equipment, $271 million (2018: $258 million) for oil and gas properties and $184 million (2018: $nil) for vessels.
|
(4)
|
As at December 31, 2019 a total of $48 million (2018: $331 million) of future development costs were included in the depletion calculation.
|
F-51
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Land
|
|
Building
|
|
Machinery and equipment
|
|
Mineral property assets and oil and gas properties
|
|
Vessels
|
|
Others
|
|
Total
|
||||||||
Lessee
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Right-of-use asset
|
|
8
|
|
|
632
|
|
|
552
|
|
|
—
|
|
|
53
|
|
|
21
|
|
|
$
|
1,266
|
|
Depreciation expense
|
|
(1
|
)
|
|
(88
|
)
|
|
(91
|
)
|
|
—
|
|
|
(11
|
)
|
|
(12
|
)
|
|
$
|
(203
|
)
|
Lessor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Assets subject to operating leases
|
|
—
|
|
|
—
|
|
|
313
|
|
|
—
|
|
|
2,494
|
|
|
—
|
|
|
$
|
2,807
|
|
F-52
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
Water and sewage concession agreements
|
|
Customer relationships
|
|
Computer software, patents trademarks and proprietary technology (3)
|
|
Loyalty program
|
|
Brand (3)
|
|
Other
|
|
Value of insurance contracts acquired
|
|
Total assets
|
||||||||||||||||
Gross carrying amount:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at January 1, 2018
|
$
|
2,153
|
|
|
$
|
730
|
|
|
$
|
172
|
|
|
$
|
163
|
|
|
$
|
—
|
|
|
$
|
142
|
|
|
$
|
—
|
|
|
$
|
3,360
|
|
Additions
|
104
|
|
|
2
|
|
|
19
|
|
|
—
|
|
|
—
|
|
|
28
|
|
|
—
|
|
|
153
|
|
||||||||
Acquisitions through business combinations (1)
|
(31
|
)
|
|
489
|
|
|
2,025
|
|
|
—
|
|
|
414
|
|
|
14
|
|
|
—
|
|
|
2,911
|
|
||||||||
Dispositions
|
(1
|
)
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
||||||||
Foreign currency translation
|
(313
|
)
|
|
(49
|
)
|
|
(26
|
)
|
|
(13
|
)
|
|
(3
|
)
|
|
(11
|
)
|
|
—
|
|
|
(415
|
)
|
||||||||
Balances at December 31, 2018
|
$
|
1,912
|
|
|
$
|
1,172
|
|
|
$
|
2,183
|
|
|
$
|
150
|
|
|
$
|
411
|
|
|
$
|
173
|
|
|
$
|
—
|
|
|
$
|
6,001
|
|
Additions
|
158
|
|
|
7
|
|
|
20
|
|
|
—
|
|
|
1
|
|
|
45
|
|
|
—
|
|
|
231
|
|
||||||||
Acquisitions through business combinations (1)
|
—
|
|
|
4,960
|
|
|
1,367
|
|
|
—
|
|
|
—
|
|
|
265
|
|
|
224
|
|
|
6,816
|
|
||||||||
Dispositions
|
—
|
|
|
—
|
|
|
(32
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(32
|
)
|
||||||||
Assets reclassified as held for sale (2)
|
(27
|
)
|
|
(365
|
)
|
|
(34
|
)
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(436
|
)
|
||||||||
Foreign currency translation
|
(75
|
)
|
|
(14
|
)
|
|
7
|
|
|
8
|
|
|
(3
|
)
|
|
(2
|
)
|
|
3
|
|
|
(76
|
)
|
||||||||
Balance at December 31, 2019
|
$
|
1,968
|
|
|
$
|
5,760
|
|
|
$
|
3,511
|
|
|
$
|
158
|
|
|
$
|
409
|
|
|
$
|
471
|
|
|
$
|
227
|
|
|
$
|
12,504
|
|
Accumulated amortization and impairment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance at January 1, 2018
|
$
|
(57
|
)
|
|
$
|
(141
|
)
|
|
$
|
(46
|
)
|
|
$
|
(5
|
)
|
|
$
|
—
|
|
|
$
|
(17
|
)
|
|
$
|
—
|
|
|
$
|
(266
|
)
|
Amortization expense
|
(69
|
)
|
|
(80
|
)
|
|
(75
|
)
|
|
(11
|
)
|
|
(10
|
)
|
|
(4
|
)
|
|
—
|
|
|
(249
|
)
|
||||||||
Dispositions
|
1
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||||||
Foreign currency translation
|
6
|
|
|
18
|
|
|
8
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33
|
|
||||||||
Balance at December 31, 2018
|
$
|
(119
|
)
|
|
$
|
(203
|
)
|
|
$
|
(111
|
)
|
|
$
|
(15
|
)
|
|
$
|
(9
|
)
|
|
$
|
(21
|
)
|
|
$
|
—
|
|
|
$
|
(478
|
)
|
Amortization expense
|
(62
|
)
|
|
(288
|
)
|
|
(196
|
)
|
|
(10
|
)
|
|
(3
|
)
|
|
(22
|
)
|
|
(1
|
)
|
|
(582
|
)
|
||||||||
Dispositions
|
(1
|
)
|
|
—
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22
|
|
||||||||
Assets reclassified as held for sale (2)
|
6
|
|
|
78
|
|
|
10
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
97
|
|
||||||||
Foreign currency translation
|
5
|
|
|
(1
|
)
|
|
(8
|
)
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
|
—
|
|
|
(4
|
)
|
||||||||
Balance at December 31, 2019
|
$
|
(171
|
)
|
|
$
|
(414
|
)
|
|
$
|
(282
|
)
|
|
$
|
(26
|
)
|
|
$
|
(12
|
)
|
|
$
|
(39
|
)
|
|
$
|
(1
|
)
|
|
$
|
(945
|
)
|
Net book value
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
December 31, 2018
|
$
|
1,793
|
|
|
$
|
969
|
|
|
$
|
2,072
|
|
|
$
|
135
|
|
|
$
|
402
|
|
|
$
|
152
|
|
|
$
|
—
|
|
|
$
|
5,523
|
|
December 31, 2019
|
$
|
1,797
|
|
|
$
|
5,346
|
|
|
$
|
3,229
|
|
|
$
|
132
|
|
|
$
|
397
|
|
|
$
|
432
|
|
|
$
|
226
|
|
|
$
|
11,559
|
|
(1)
|
See Note 3 for additional information.
|
(2)
|
Includes assets that were reclassified as held for sale and subsequently disposed. See Note 8 and Note 9 for additional information.
|
(3)
|
Includes indefinite life intangible assets with a carrying value of $799 million (2018: $297 million) in our infrastructure services and industrials segments.
|
F-53
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Balance at beginning of year
|
|
$
|
2,411
|
|
|
$
|
1,554
|
|
Acquisitions through business combinations (1)
|
|
3,444
|
|
|
957
|
|
||
Impairment losses
|
|
(418
|
)
|
|
—
|
|
||
Dispositions
|
|
(21
|
)
|
|
—
|
|
||
Assets reclassified as held for sale (2)
|
|
(212
|
)
|
|
—
|
|
||
Foreign currency translation
|
|
14
|
|
|
(100
|
)
|
||
Balance at end of year
|
|
$
|
5,218
|
|
|
$
|
2,411
|
|
(1)
|
See Note 3 for additional information.
|
(2)
|
Includes assets that were reclassified as held for sale and subsequently disposed. See Note 8 and Note 9 for additional information.
|
F-54
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Business services
|
|
2,514
|
|
|
1,306
|
|
||
Infrastructure services
|
|
470
|
|
|
760
|
|
||
Industrials
|
|
2,234
|
|
|
345
|
|
||
Total
|
|
$
|
5,218
|
|
|
$
|
2,411
|
|
(US$ MILLIONS)
|
Economic interest
|
|
Voting interest
|
|
Carrying value
|
||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
Business services
|
14%-90%
|
|
13%-90%
|
|
14%-90%
|
|
13%-90%
|
|
$
|
53
|
|
|
$
|
130
|
|
Infrastructure services
|
25%-50%
|
|
25%-50%
|
|
25%-50%
|
|
25%-50%
|
|
366
|
|
|
338
|
|
||
Industrials
|
24%-54%
|
|
24%-50%
|
|
24%-50%
|
|
24%-50%
|
|
854
|
|
|
73
|
|
||
Total
|
|
|
|
|
|
|
|
|
$
|
1,273
|
|
|
$
|
541
|
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Balance at beginning of year
|
|
$
|
541
|
|
|
$
|
609
|
|
Adoption of new accounting standards
|
|
—
|
|
|
(7
|
)
|
||
Acquisitions through business combinations (1)
|
|
847
|
|
|
310
|
|
||
Additions (2)
|
|
25
|
|
|
267
|
|
||
Dispositions (2)
|
|
(162
|
)
|
|
(599
|
)
|
||
Share of net income
|
|
114
|
|
|
10
|
|
||
Share of other comprehensive income
|
|
—
|
|
|
(1
|
)
|
||
Distributions received
|
|
(62
|
)
|
|
(29
|
)
|
||
Foreign currency translation
|
|
(30
|
)
|
|
(19
|
)
|
||
Balance at end of period
|
|
$
|
1,273
|
|
|
$
|
541
|
|
(1)
|
See Note 3 for additional information.
|
(2)
|
Includes non-cash additions/dispositions related to the consolidation of an investment within Greenergy in 2019 and our equity accounted investment in Teekay Offshore in 2018.
|
F-55
|
Brookfield Business Partners
|
|
Year ended December 31, 2019
|
|||||||||||||||||||||||||||
|
Total
|
|
||||||||||||||||||||||||||
(US$ MILLIONS)
|
Current assets
|
|
Non-current assets
|
|
Total assets
|
|
Current liabilities
|
|
Non-current liabilities
|
|
Total liabilities
|
|
Total net assets
|
|
||||||||||||||
Business services
|
$
|
586
|
|
|
$
|
1,057
|
|
|
$
|
1,643
|
|
|
$
|
515
|
|
|
$
|
943
|
|
|
$
|
1,458
|
|
|
$
|
185
|
|
|
Infrastructure services
|
187
|
|
|
1,287
|
|
|
1,474
|
|
|
128
|
|
|
617
|
|
|
745
|
|
|
729
|
|
|
|||||||
Industrials
|
1,038
|
|
|
743
|
|
|
1,781
|
|
|
486
|
|
|
257
|
|
|
743
|
|
|
1,038
|
|
|
|||||||
Total
|
$
|
1,811
|
|
|
$
|
3,087
|
|
|
$
|
4,898
|
|
|
$
|
1,129
|
|
|
$
|
1,817
|
|
|
$
|
2,946
|
|
|
$
|
1,952
|
|
|
|
Year ended December 31, 2018
|
|||||||||||||||||||||||||||
|
Total
|
|
||||||||||||||||||||||||||
(US$ MILLIONS)
|
Current assets
|
|
Non-current assets
|
|
Total assets
|
|
Current liabilities
|
|
Non-current liabilities
|
|
Total liabilities
|
|
Total net assets
|
|
||||||||||||||
Business services
|
$
|
575
|
|
|
$
|
478
|
|
|
$
|
1,053
|
|
|
$
|
451
|
|
|
$
|
229
|
|
|
$
|
680
|
|
|
$
|
373
|
|
|
Infrastructure services
|
205
|
|
|
1,359
|
|
|
1,564
|
|
|
179
|
|
|
747
|
|
|
926
|
|
|
638
|
|
|
|||||||
Industrials
|
38
|
|
|
277
|
|
|
315
|
|
|
26
|
|
|
136
|
|
|
162
|
|
|
153
|
|
|
|||||||
Total
|
$
|
818
|
|
|
$
|
2,114
|
|
|
$
|
2,932
|
|
|
$
|
656
|
|
|
$
|
1,112
|
|
|
$
|
1,768
|
|
|
$
|
1,164
|
|
|
(1)
|
Attributable to limited partner and redemption-exchange unitholders.
|
F-56
|
Brookfield Business Partners
|
|
Year ended December 31, 2019
|
||||||||||||||
|
Total
|
||||||||||||||
(US$ MILLIONS)
|
Revenue
|
|
Net income
|
|
OCI
|
|
Total comprehensive income
|
||||||||
Business services
|
$
|
537
|
|
|
$
|
117
|
|
|
$
|
9
|
|
|
$
|
126
|
|
Infrastructure services
|
388
|
|
|
119
|
|
|
—
|
|
|
119
|
|
||||
Industrials
|
1,770
|
|
|
121
|
|
|
—
|
|
|
121
|
|
||||
Total
|
$
|
2,695
|
|
|
$
|
357
|
|
|
$
|
9
|
|
|
$
|
366
|
|
|
Year Ended December 31, 2018
|
||||||||||||||
|
Total
|
||||||||||||||
(US$ MILLIONS)
|
Revenue
|
|
Net income
|
|
OCI
|
|
Total comprehensive income
|
||||||||
Business services
|
$
|
605
|
|
|
$
|
102
|
|
|
$
|
(15
|
)
|
|
$
|
87
|
|
Infrastructure services
|
828
|
|
|
(31
|
)
|
|
2
|
|
|
(29
|
)
|
||||
Industrials
|
445
|
|
|
62
|
|
|
(18
|
)
|
|
44
|
|
||||
Total
|
$
|
1,878
|
|
|
$
|
133
|
|
|
$
|
(31
|
)
|
|
$
|
102
|
|
|
Year Ended December 31, 2017
|
||||||||||||||
|
Total
|
||||||||||||||
(US$ MILLIONS)
|
Revenue
|
|
Net income
|
|
OCI
|
|
Total comprehensive income
|
||||||||
Business services
|
$
|
397
|
|
|
$
|
81
|
|
|
$
|
—
|
|
|
$
|
81
|
|
Infrastructure services
|
301
|
|
|
(25
|
)
|
|
2
|
|
|
(23
|
)
|
||||
Industrials
|
$
|
811
|
|
|
$
|
327
|
|
|
$
|
(40
|
)
|
|
$
|
287
|
|
Total
|
$
|
1,509
|
|
|
$
|
383
|
|
|
$
|
(38
|
)
|
|
$
|
345
|
|
|
|
December 31, 2019
|
|
December 31, 2018
|
||||||||||||
(US$ MILLIONS)
|
|
Public price
|
|
Carrying value
|
|
Public price
|
|
Carrying value
|
||||||||
Business services
|
|
$
|
38
|
|
|
$
|
—
|
|
|
$
|
36
|
|
|
$
|
—
|
|
Industrials
|
|
416
|
|
|
379
|
|
|
—
|
|
|
—
|
|
||||
Total
|
|
$
|
454
|
|
|
$
|
379
|
|
|
$
|
36
|
|
|
$
|
—
|
|
F-57
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Current:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
2,919
|
|
|
$
|
1,819
|
|
Accrued and other liabilities (1) (2)
|
|
3,978
|
|
|
3,323
|
|
||
Lease liability
|
|
224
|
|
|
—
|
|
||
Financial liabilities (5)
|
|
327
|
|
|
175
|
|
||
Unearned premiums reserve
|
|
482
|
|
|
—
|
|
||
Work in progress (3)
|
|
1,415
|
|
|
1,637
|
|
||
Provisions and decommissioning liabilities
|
|
442
|
|
|
234
|
|
||
Liabilities held for sale
|
|
94
|
|
|
9
|
|
||
Total current
|
|
$
|
9,881
|
|
|
$
|
7,197
|
|
Non-current:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
116
|
|
|
$
|
97
|
|
Accrued and other liabilities (2)
|
|
1,110
|
|
|
1,022
|
|
||
Lease liability
|
|
1,109
|
|
|
—
|
|
||
Financial liabilities (5)
|
|
2,048
|
|
|
184
|
|
||
Unearned premiums reserve
|
|
1,143
|
|
|
—
|
|
||
Work in progress (3)
|
|
60
|
|
|
71
|
|
||
Provisions and decommissioning liabilities (4)
|
|
1,029
|
|
|
520
|
|
||
Total non-current
|
|
$
|
6,615
|
|
|
$
|
1,894
|
|
(1)
|
Includes bank overdrafts of $921 million as at December 31, 2019 (2018: $581 million).
|
(2)
|
Includes post-employment benefits of $835 million ($18 million current and $817 million non-current). See Note 31 for additional information.
|
(3)
|
See Note 17 for additional information.
|
(4)
|
Decommissioning liability results primarily from the partnership’s ownership interest in oil and natural gas wells and facilities, retail gas stations, a services provider to the offshore oil production industry and power generation services. The liability represents the estimated cost to reclaim and abandon the asset and takes into account the estimated timing of the cost to be incurred in future periods. The liability was determined using a risk rate between 1.6% and 8.5% (2018: 1.9% and 8.5%) and an inflation rate between 2.0% and 3.0% (2018: 1.9% and 3.0%), determined as appropriate for the underlying subsidiaries.
|
(5)
|
Includes financial liabilities of $1,704 million ($50 million current and $1,654 million non-current) as at December 31, 2019 related to the sale and leaseback of hospitals as described below.
|
F-58
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Decommissioning liability
|
|
Warranties and provisions for defects
|
|
Other
|
|
Total provisions
|
||||||||
Balance at January 1, 2018
|
|
$
|
93
|
|
|
$
|
45
|
|
|
$
|
82
|
|
|
$
|
220
|
|
Additions through business combinations (1)
|
|
193
|
|
|
23
|
|
|
365
|
|
|
581
|
|
||||
Additional provisions recognized
|
|
—
|
|
|
13
|
|
|
60
|
|
|
73
|
|
||||
Reduction arising from payments/derecognition
|
|
(5
|
)
|
|
(12
|
)
|
|
(135
|
)
|
|
(152
|
)
|
||||
Accretion expenses
|
|
8
|
|
|
—
|
|
|
1
|
|
|
9
|
|
||||
Change in discount rate
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||
Change in other estimates
|
|
31
|
|
|
21
|
|
|
(9
|
)
|
|
43
|
|
||||
Net foreign currency exchange differences
|
|
(8
|
)
|
|
(3
|
)
|
|
(8
|
)
|
|
(19
|
)
|
||||
Balance at December 31, 2018
|
|
$
|
311
|
|
|
$
|
87
|
|
|
$
|
356
|
|
|
$
|
754
|
|
Additions through business combinations (1)
|
|
52
|
|
|
119
|
|
|
428
|
|
|
599
|
|
||||
Additional provisions recognized
|
|
9
|
|
|
175
|
|
|
200
|
|
|
384
|
|
||||
Reduction arising from payments/derecognition
|
|
(6
|
)
|
|
(126
|
)
|
|
(324
|
)
|
|
(456
|
)
|
||||
Accretion expenses
|
|
16
|
|
|
—
|
|
|
—
|
|
|
16
|
|
||||
Change in discount rate
|
|
154
|
|
|
—
|
|
|
2
|
|
|
156
|
|
||||
Change in other estimates
|
|
44
|
|
|
(5
|
)
|
|
4
|
|
|
43
|
|
||||
Transfers to held for sale
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(10
|
)
|
||||
Dispositions
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
||||
Net foreign currency exchange differences
|
|
6
|
|
|
—
|
|
|
(2
|
)
|
|
4
|
|
||||
Balance at December 31, 2019
|
|
$
|
567
|
|
|
$
|
250
|
|
|
$
|
654
|
|
|
$
|
1,471
|
|
(1)
|
2019 includes provisions for site restoration, legal fees, warranties, restructuring and other provisions for long-term compensation arrangements related to the acquisitions of Clarios and Ouro Verde in our industrials segment, and Healthscope and Genworth in our business services segment. 2018 includes provisions for site restoration, legal fees, and reserves for contract loss attributable to the acquisitions of Westinghouse and consolidation of Teekay Offshore in our infrastructure services segment.
|
F-59
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Contract costs incurred to date
|
|
$
|
23,041
|
|
|
$
|
20,455
|
|
|
$
|
12,129
|
|
Profit recognized to date (less recognized losses)
|
|
1,843
|
|
|
1,946
|
|
|
558
|
|
|||
|
|
24,884
|
|
|
22,401
|
|
|
12,687
|
|
|||
Less: progress billings
|
|
(25,782
|
)
|
|
(23,546
|
)
|
|
(12,919
|
)
|
|||
Contract work in progress (liability)
|
|
$
|
(898
|
)
|
|
$
|
(1,145
|
)
|
|
$
|
(232
|
)
|
Comprising:
|
|
|
|
|
|
|
||||||
Amounts due from customers — work in progress (1)
|
|
$
|
577
|
|
|
$
|
563
|
|
|
$
|
195
|
|
Amounts due to customers — creditors (2)
|
|
(1,475
|
)
|
|
(1,708
|
)
|
|
(427
|
)
|
|||
Net work in progress
|
|
$
|
(898
|
)
|
|
$
|
(1,145
|
)
|
|
$
|
(232
|
)
|
(1)
|
The change in the balance from December 31, 2018 was due to billed amounts of $3,918 million, additions to work in progress of $3,917 million, acquisitions through business combinations of $76 million, dispositions of $65 million and the remainder due to foreign exchange changes.
|
(2)
|
The change in the balance from December 31, 2018 was due to recognized revenue of $3,134 million, additions to work in progress of $2,900 million, acquisitions through business combinations of $nil, dispositions of $2 million and the remainder due to foreign exchange changes.
|
(US$ MILLIONS)
|
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Total borrowings
|
||||||||
2020
|
|
$
|
268
|
|
|
$
|
513
|
|
|
$
|
386
|
|
|
$
|
1,167
|
|
2021
|
|
113
|
|
|
346
|
|
|
409
|
|
|
868
|
|
||||
2022
|
|
522
|
|
|
608
|
|
|
297
|
|
|
1,427
|
|
||||
2023
|
|
135
|
|
|
720
|
|
|
264
|
|
|
1,119
|
|
||||
2024
|
|
1,364
|
|
|
484
|
|
|
1,099
|
|
|
2,947
|
|
||||
Thereafter
|
|
264
|
|
|
3,293
|
|
|
11,807
|
|
|
15,364
|
|
||||
Total - Principal repayments
|
|
$
|
2,666
|
|
|
$
|
5,964
|
|
|
$
|
14,262
|
|
|
$
|
22,892
|
|
Total - Deferred financing costs and other
|
|
$
|
(45
|
)
|
|
$
|
(104
|
)
|
|
$
|
(344
|
)
|
|
$
|
(493
|
)
|
Total - December 31, 2019
|
|
$
|
2,621
|
|
|
$
|
5,860
|
|
|
$
|
13,918
|
|
|
$
|
22,399
|
|
Total - December 31, 2018
|
|
$
|
1,228
|
|
|
$
|
5,748
|
|
|
$
|
3,890
|
|
|
$
|
10,866
|
|
Brookfield Business Partners
|
F-60
|
|
|
Weighted average rate
|
|
Weighted average term
|
|
Consolidated
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||
Business services
|
|
5.8
|
%
|
|
5.1
|
%
|
|
4.3
|
|
2.5
|
|
$
|
2,621
|
|
|
$
|
1,228
|
|
Infrastructure services
|
|
5.2
|
%
|
|
6.2
|
%
|
|
5.2
|
|
6.1
|
|
5,860
|
|
|
5,748
|
|
||
Industrials
|
|
5.7
|
%
|
|
7.3
|
%
|
|
6.3
|
|
6.7
|
|
13,918
|
|
|
$
|
3,890
|
|
|
Total
|
|
5.5
|
%
|
|
6.5
|
%
|
|
5.7
|
|
5.9
|
|
$
|
22,399
|
|
|
$
|
10,866
|
|
(US$ MILLIONS, except as noted)
|
|
December 31,
2019 |
|
Local currency
|
|
December 31,
2018 |
|
Local currency
|
||||||
Australian dollars
|
|
$
|
1,264
|
|
|
1,801
|
|
|
$
|
5
|
|
|
7
|
|
British pounds
|
|
10
|
|
|
8
|
|
|
33
|
|
|
26
|
|
||
U.S. dollars
|
|
15,436
|
|
|
15,436
|
|
|
8,605
|
|
|
8,605
|
|
||
Canadian dollars
|
|
772
|
|
|
1,003
|
|
|
786
|
|
|
1,073
|
|
||
Euro
|
|
3,578
|
|
|
3,546
|
|
|
264
|
|
|
231
|
|
||
Brazilian reais
|
|
1,330
|
|
|
5,362
|
|
|
1,135
|
|
|
4,399
|
|
||
Other
|
|
9
|
|
|
7
|
|
|
38
|
|
|
175
|
|
||
Total
|
|
$
|
22,399
|
|
|
|
|
$
|
10,866
|
|
|
|
F-61
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Current income tax expense/(recovery)
|
|
$
|
324
|
|
|
$
|
186
|
|
|
$
|
30
|
|
Deferred income tax expense/(recovery):
|
|
|
|
|
|
|
||||||
Origination and reversal of temporary differences
|
|
(138
|
)
|
|
(61
|
)
|
|
(14
|
)
|
|||
Recovery arising from previously unrecognized tax assets
|
|
(6
|
)
|
|
(27
|
)
|
|
(10
|
)
|
|||
Change of tax rates and imposition of new legislations
|
|
12
|
|
|
—
|
|
|
2
|
|
|||
Total deferred income taxes
|
|
(132
|
)
|
|
(88
|
)
|
|
(22
|
)
|
|||
Income taxes
|
|
$
|
192
|
|
|
$
|
98
|
|
|
$
|
8
|
|
|
|
2019
|
|
2018
|
|
2017
|
|||
Composite income tax rate
|
|
27
|
%
|
|
27
|
%
|
|
27
|
%
|
Increase (reduction) in rate resulting from:
|
|
|
|
|
|
|
|||
Portion of gains subject to different tax rates
|
|
(11
|
)
|
|
(1
|
)
|
|
(6
|
)
|
International operations subject to different tax rates
|
|
(5
|
)
|
|
(16
|
)
|
|
5
|
|
Taxable income attributable to non-controlling interests
|
|
(6
|
)
|
|
(3
|
)
|
|
(18
|
)
|
Recognition of deferred tax assets
|
|
—
|
|
|
(2
|
)
|
|
(5
|
)
|
Non-recognition of the benefit of current year’s tax losses
|
|
17
|
|
|
1
|
|
|
(1
|
)
|
Change in tax rates and imposition of new legislation
|
|
4
|
|
|
—
|
|
|
—
|
|
Other
|
|
4
|
|
|
2
|
|
|
1
|
|
Effective income tax rate
|
|
30
|
%
|
|
8
|
%
|
|
3
|
%
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Non-capital losses (Canada)
|
|
$
|
11
|
|
|
$
|
28
|
|
Capital losses (Canada)
|
|
—
|
|
|
—
|
|
||
Losses (U.S.)
|
|
78
|
|
|
72
|
|
||
Losses (International)
|
|
264
|
|
|
78
|
|
||
Difference in basis
|
|
(1,489
|
)
|
|
(765
|
)
|
||
Total net deferred tax (liability)/asset
|
|
$
|
(1,136
|
)
|
|
$
|
(587
|
)
|
Reflected in the statement of financial position as follows:
|
|
|
|
|
||||
Deferred income tax assets
|
|
667
|
|
|
280
|
|
||
Deferred income tax liabilities
|
|
(1,803
|
)
|
|
(867
|
)
|
||
Total net deferred tax (liability)/asset
|
|
$
|
(1,136
|
)
|
|
$
|
(587
|
)
|
Brookfield Business Partners
|
F-62
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Opening net deferred tax (liability)/asset
|
|
$
|
(587
|
)
|
|
$
|
(663
|
)
|
Recognized in income
|
|
132
|
|
|
88
|
|
||
Recognized in other comprehensive income
|
|
15
|
|
|
(2
|
)
|
||
Recognized in other (1)
|
|
(696
|
)
|
|
(10
|
)
|
||
Net deferred tax (liability)/asset
|
|
$
|
(1,136
|
)
|
|
$
|
(587
|
)
|
(1)
|
The Other category primarily relates to acquisitions and dispositions and the foreign exchange impact of the deferred tax asset calculated in the functional currency of the operating entities.
|
(US$ MILLIONS)
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
One year from reporting date
|
|
$
|
19
|
|
|
$
|
10
|
|
Two years from reporting date
|
|
5
|
|
|
—
|
|
||
Three years from reporting date
|
|
5
|
|
|
1
|
|
||
After three years from reporting date
|
|
337
|
|
|
322
|
|
||
Do not expire
|
|
731
|
|
|
587
|
|
||
Total
|
|
$
|
1,097
|
|
|
$
|
920
|
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Fair value through OCI
|
|
$
|
—
|
|
|
$
|
(3
|
)
|
|
$
|
(1
|
)
|
Net investment hedges
|
|
(15
|
)
|
|
13
|
|
|
(8
|
)
|
|||
Cash flow hedges
|
|
(1
|
)
|
|
(6
|
)
|
|
10
|
|
|||
Equity accounted investments
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|||
Pension plan actuarial changes
|
|
1
|
|
|
(2
|
)
|
|
—
|
|
|||
Total deferred tax expense (recovery) in other comprehensive income
|
|
$
|
(15
|
)
|
|
$
|
2
|
|
|
$
|
—
|
|
F-63
|
Brookfield Business Partners
|
|
|
General Partner Units
|
|
Limited Partnership Units
|
|
Total
|
||||||||||||
UNITS
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||
Authorized and issued
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Opening balance
|
|
4
|
|
|
4
|
|
|
66,185,798
|
|
|
66,185,798
|
|
|
66,185,802
|
|
|
66,185,802
|
|
Repurchased and canceled
|
|
—
|
|
|
—
|
|
|
(202,143
|
)
|
|
—
|
|
|
(202,143
|
)
|
|
—
|
|
Issued for cash
|
|
—
|
|
|
—
|
|
|
14,907,000
|
|
|
—
|
|
|
14,907,000
|
|
|
—
|
|
On issue at December 31
|
|
4
|
|
|
4
|
|
|
80,890,655
|
|
|
66,185,798
|
|
|
80,890,659
|
|
|
66,185,802
|
|
|
|
Redemption-Exchange Units held by Brookfield
|
||||
UNITS
|
|
2019
|
|
2018
|
F-64
|
Brookfield Business Partners
|
Authorized and issued
|
|
|
|
|
||
Opening balance
|
|
63,095,497
|
|
|
63,095,497
|
|
Issued for cash
|
|
6,610,000
|
|
|
—
|
|
On issue at December 31
|
|
69,705,497
|
|
|
63,095,497
|
|
|
|
Special Limited Partner Units held by Brookfield
|
||||
UNITS
|
|
2019
|
|
2018
|
||
Authorized and issued
|
|
|
|
|
||
Opening balance
|
|
4
|
|
|
4
|
|
On issue at December 31
|
|
4
|
|
|
4
|
|
|
|
Preferred Shares held by Brookfield
|
||||
UNITS
|
|
2019
|
|
2018
|
||
Authorized and issued
|
|
|
|
|
||
Opening balance
|
|
200,002
|
|
|
200,002
|
|
On issue at December 31
|
|
200,002
|
|
|
200,002
|
|
(US$ MILLIONS)
|
|
Foreign currency
translation
|
|
Fair value through OCI
|
|
Other (1)
|
|
Accumulated other
comprehensive
income (loss)
|
||||||||
Balance as at January 1, 2019
|
|
$
|
(182
|
)
|
|
$
|
9
|
|
|
$
|
(13
|
)
|
|
$
|
(186
|
)
|
Other comprehensive income (loss)
|
|
13
|
|
|
2
|
|
|
(47
|
)
|
|
(32
|
)
|
||||
Balance as at December 31, 2019
|
|
$
|
(169
|
)
|
|
$
|
11
|
|
|
$
|
(60
|
)
|
|
$
|
(218
|
)
|
(1)
|
Represents net investment hedges, cash flow hedges and other reserves.
|
F-65
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Foreign currency
translation
|
|
Fair value through OCI
|
|
Other (1)
|
|
Accumulated other
comprehensive
income (loss)
|
||||||||
Balance as at January 1, 2018
|
|
$
|
(111
|
)
|
|
$
|
6
|
|
|
$
|
(7
|
)
|
|
$
|
(112
|
)
|
Other comprehensive income (loss)
|
|
(71
|
)
|
|
3
|
|
|
(5
|
)
|
|
(73
|
)
|
||||
Ownership changes
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Balance as at December 31, 2018
|
|
$
|
(182
|
)
|
|
$
|
9
|
|
|
$
|
(13
|
)
|
|
$
|
(186
|
)
|
(1)
|
Represents net investment hedges, cash flow hedges and other reserves.
|
(US$ MILLIONS)
|
|
Foreign currency
translation
|
|
Available for sale
|
|
Other (1)
|
|
Accumulated other
comprehensive
income (loss)
|
||||||||
Balance as at January 1, 2017
|
|
$
|
(148
|
)
|
|
$
|
4
|
|
|
$
|
3
|
|
|
$
|
(141
|
)
|
Other comprehensive income (loss)
|
|
37
|
|
|
2
|
|
|
(10
|
)
|
|
29
|
|
||||
Balance as at December 31, 2017
|
|
$
|
(111
|
)
|
|
$
|
6
|
|
|
$
|
(7
|
)
|
|
$
|
(112
|
)
|
(1)
|
Represents net investment hedges, cash flow hedges and other reserves.
|
(US$ MILLIONS)
|
|
Foreign currency
translation
|
|
Fair value through OCI
|
|
Other (1)
|
|
Accumulated other
comprehensive
income (loss)
|
||||||||
Balance as at January 1, 2019
|
|
$
|
(232
|
)
|
|
$
|
7
|
|
|
$
|
(10
|
)
|
|
$
|
(235
|
)
|
Other comprehensive income (loss)
|
|
11
|
|
|
2
|
|
|
(42
|
)
|
|
(29
|
)
|
||||
Balance as at December 31, 2019
|
|
$
|
(221
|
)
|
|
$
|
9
|
|
|
$
|
(52
|
)
|
|
$
|
(264
|
)
|
(1)
|
Represents net investment hedges, cash flow hedges and other reserves.
|
(US$ MILLIONS)
|
|
Foreign currency
translation
|
|
Fair value through OCI
|
|
Other (1)
|
|
Accumulated other
comprehensive
income (loss)
|
||||||||
Balance as at January 1, 2018
|
|
$
|
(165
|
)
|
|
$
|
4
|
|
|
$
|
(4
|
)
|
|
$
|
(165
|
)
|
Other comprehensive income (loss)
|
|
(67
|
)
|
|
3
|
|
|
(5
|
)
|
|
(69
|
)
|
||||
Ownership changes
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
||||
Balance as at December 31, 2018
|
|
$
|
(232
|
)
|
|
$
|
7
|
|
|
$
|
(10
|
)
|
|
$
|
(235
|
)
|
(1)
|
Represents net investment hedges, cash flow hedges and other reserves.
|
F-66
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Foreign currency
translation
|
|
Available for sale
|
|
Other (1)
|
|
Accumulated other
comprehensive
income (loss)
|
||||||||
Balance as at January 1, 2017
|
|
$
|
(205
|
)
|
|
$
|
2
|
|
|
$
|
6
|
|
|
$
|
(197
|
)
|
Other comprehensive income (loss)
|
|
40
|
|
|
2
|
|
|
(10
|
)
|
|
32
|
|
||||
Balance as at December 31, 2017
|
|
$
|
(165
|
)
|
|
$
|
4
|
|
|
$
|
(4
|
)
|
|
$
|
(165
|
)
|
(1)
|
Represents net investment hedges, cash flow hedges and other reserves.
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Cost of sales
|
|
$
|
33,963
|
|
|
$
|
31,539
|
|
|
$
|
20,276
|
|
Compensation
|
|
4,299
|
|
|
2,530
|
|
|
1,568
|
|
|||
Property taxes, sales taxes and other
|
|
65
|
|
|
65
|
|
|
32
|
|
|||
Total
|
|
$
|
38,327
|
|
|
$
|
34,134
|
|
|
$
|
21,876
|
|
F-67
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
1 Year
|
|
2-5 Years
|
|
5+ Years
|
|
Total
|
||||||||
Lease liability
|
|
$
|
229
|
|
|
$
|
545
|
|
|
$
|
603
|
|
|
$
|
1,377
|
|
Total lease liability
|
|
$
|
229
|
|
|
$
|
545
|
|
|
$
|
603
|
|
|
$
|
1,377
|
|
(US$ MILLIONS)
|
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
Revenue by type
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue from contracts with customers
|
|
$
|
28,718
|
|
|
$
|
3,947
|
|
|
$
|
9,643
|
|
|
$
|
—
|
|
|
$
|
42,308
|
|
Other revenue
|
|
104
|
|
|
612
|
|
|
8
|
|
|
—
|
|
|
724
|
|
|||||
Total revenue
|
|
$
|
28,822
|
|
|
$
|
4,559
|
|
|
$
|
9,651
|
|
|
$
|
—
|
|
|
$
|
43,032
|
|
(US$ MILLIONS)
|
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
Timing of revenue recognition
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Goods and services provided at a point in time
|
|
$
|
23,070
|
|
|
$
|
1,379
|
|
|
$
|
9,409
|
|
|
$
|
—
|
|
|
$
|
33,858
|
|
Services transferred over a period of time
|
|
5,648
|
|
|
2,568
|
|
|
234
|
|
|
—
|
|
|
8,450
|
|
|||||
Total revenue from contracts with customers
|
|
$
|
28,718
|
|
|
$
|
3,947
|
|
|
$
|
9,643
|
|
|
$
|
—
|
|
|
$
|
42,308
|
|
Brookfield Business Partners
|
F-68
|
(US$ MILLIONS)
|
|
1 Year
|
|
2-5 Years
|
|
5+ Years
|
|
Total
|
||||||||
Operating leases
|
|
$
|
435
|
|
|
$
|
1,071
|
|
|
$
|
499
|
|
|
$
|
2,005
|
|
Total
|
|
$
|
435
|
|
|
$
|
1,071
|
|
|
$
|
499
|
|
|
$
|
2,005
|
|
F-69
|
Brookfield Business Partners
|
|
Year ended December 31,
|
||||||||||
(US$ MILLIONS)
|
2019
|
|
2018
|
|
2017
|
||||||
Transactions during the period
|
|
|
|
|
|
||||||
Revenues (1)
|
$
|
452
|
|
|
$
|
435
|
|
|
$
|
358
|
|
Interest income (2)
|
$
|
15
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Within our business services segment, the partnership provides construction services to affiliates of Brookfield.
|
(2)
|
Interest income is related to a financial asset in our corporate segment.
|
(US$ MILLIONS)
|
December 31, 2019
|
|
December 31, 2018
|
||||
Balances at end of period:
|
|
|
|
||||
Financial assets
|
$
|
174
|
|
|
$
|
—
|
|
Accounts and other receivable, net
|
$
|
36
|
|
|
$
|
63
|
|
Accounts payable and other
|
$
|
210
|
|
|
$
|
63
|
|
(US$ MILLIONS)
|
2019
|
|
2018
|
||||
Foreign exchange contracts
|
$
|
6,261
|
|
|
$
|
1,652
|
|
Cross currency swaps
|
374
|
|
|
15
|
|
||
Interest rate derivatives
|
13,058
|
|
|
8,217
|
|
||
Equity derivatives
|
47
|
|
|
31
|
|
||
|
$
|
19,740
|
|
|
$
|
9,915
|
|
Commodity instruments
|
2019
|
|
2018
|
||
Oil based fuel (Cbm - millions)
|
5.39
|
|
|
6.17
|
|
Natural gas (Mcf - millions)
|
11.74
|
|
|
8.22
|
|
Lead (metric tons)
|
20,420
|
|
|
—
|
|
Tin (metric tons)
|
2,548
|
|
|
—
|
|
Polypropylene (metric tons)
|
31,120
|
|
|
—
|
|
F-70
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
Notional amount
(U.S. Dollars)
|
|
Average exchange rate (USD to FC)
|
||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||
Foreign exchange contracts
|
|
|
|
|
|
|
|
||||||
Australian dollars
|
$
|
682
|
|
|
$
|
184
|
|
|
1.45
|
|
|
1.33
|
|
Brazilian real
|
89
|
|
|
35
|
|
|
4.06
|
|
|
3.99
|
|
||
British pounds
|
650
|
|
|
131
|
|
|
0.77
|
|
|
0.78
|
|
||
Canadian dollars
|
2,037
|
|
|
940
|
|
|
1.30
|
|
|
1.32
|
|
||
Chinese yuan
|
1
|
|
|
(15
|
)
|
|
6.97
|
|
|
7.16
|
|
||
European Union euros
|
782
|
|
|
44
|
|
|
0.88
|
|
|
0.85
|
|
||
Indian rupees
|
189
|
|
|
188
|
|
|
73.33
|
|
|
74.09
|
|
||
Japanese yen
|
14
|
|
|
4
|
|
|
104.19
|
|
|
110.14
|
|
||
Mexican pesos
|
10
|
|
|
(5
|
)
|
|
18.90
|
|
|
19.75
|
|
||
Norwegian krone
|
52
|
|
|
53
|
|
|
8.87
|
|
|
7.96
|
|
||
South Africa rand
|
3
|
|
|
3
|
|
|
14.05
|
|
|
14.48
|
|
||
Swedish krona
|
1,578
|
|
|
94
|
|
|
9.10
|
|
|
7.87
|
|
||
Swiss franc
|
50
|
|
|
(4
|
)
|
|
0.97
|
|
|
1.00
|
|
||
Colombian peso
|
49
|
|
|
—
|
|
|
3,359.91
|
|
|
—
|
|
||
South Korean won
|
68
|
|
|
—
|
|
|
1,265.03
|
|
|
—
|
|
||
Peruvian dollar
|
7
|
|
|
—
|
|
|
3.41
|
|
|
—
|
|
||
|
$
|
6,261
|
|
|
$
|
1,652
|
|
|
|
|
|
|
|
2019
|
|
2018
|
||||||||||||||||
(US$ MILLIONS)
|
|
< 1 year
|
|
1 to 5 years
|
|
>5 years
|
|
Total notional amount
|
|
Total notional amount
|
||||||||||
Fair value through profit or loss
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts
|
|
$
|
2,478
|
|
|
$
|
171
|
|
|
$
|
70
|
|
|
$
|
2,719
|
|
|
$
|
315
|
|
Cross currency swaps
|
|
160
|
|
|
126
|
|
|
87
|
|
|
373
|
|
|
15
|
|
|||||
Interest rate derivatives
|
|
77
|
|
|
5,798
|
|
|
431
|
|
|
6,306
|
|
|
1,467
|
|
|||||
Equity derivatives
|
|
24
|
|
|
23
|
|
|
—
|
|
|
47
|
|
|
31
|
|
|||||
Elected for hedge accounting
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts
|
|
1,913
|
|
|
1,629
|
|
|
—
|
|
|
3,542
|
|
|
1,337
|
|
|||||
Interest rate derivatives
|
|
—
|
|
|
6,753
|
|
|
—
|
|
|
6,753
|
|
|
1,500
|
|
|||||
Option contracts
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,250
|
|
|||||
|
|
$
|
4,652
|
|
|
$
|
14,500
|
|
|
$
|
588
|
|
|
$
|
19,740
|
|
|
$
|
9,915
|
|
F-71
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Corporate borrowings
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-recourse borrowings in subsidiaries of the partnership
|
|
22,399
|
|
|
10,866
|
|
||
Cash
|
|
(1,986
|
)
|
|
(1,949
|
)
|
||
Net debt
|
|
20,413
|
|
|
8,917
|
|
||
Total equity
|
|
11,053
|
|
|
6,494
|
|
||
Total capital and net debt
|
|
$
|
31,466
|
|
|
$
|
15,411
|
|
Net debt to capitalization ratio
|
|
65
|
%
|
|
58
|
%
|
F-72
|
Brookfield Business Partners
|
|
December 31, 2019
|
|
|
||||||||||||||||
(US$ MILLIONS)
|
Less than 1 year
|
|
1-2 years
|
|
2-5 years
|
|
5+ years
|
|
Total contractual cash flows
|
||||||||||
Non-derivative financial liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other liabilities (1)
|
$
|
8,888
|
|
|
$
|
1,008
|
|
|
$
|
777
|
|
|
$
|
1,803
|
|
|
$
|
12,476
|
|
Interest-bearing liabilities
|
2,184
|
|
|
1,786
|
|
|
7,713
|
|
|
16,397
|
|
|
28,080
|
|
|||||
Lease liabilities
|
229
|
|
|
152
|
|
|
393
|
|
|
603
|
|
|
1,377
|
|
(1)
|
Excludes $2,306 million of decommissioning liabilities, other provisions, post-employment benefits and $210 million of loans and notes payable.
|
|
December 31, 2018
|
|
|
||||||||||||||||
(US$ MILLIONS)
|
Less than 1 year
|
|
1-2 years
|
|
2-5 years
|
|
5+ years
|
|
Total contractual cash flows
|
||||||||||
Non-derivative financial liabilities
|
|
|
|
|
|
|
|
|
|
||||||||||
Accounts payable and other liabilities (1)
|
$
|
6,863
|
|
|
$
|
364
|
|
|
$
|
219
|
|
|
$
|
192
|
|
|
$
|
7,638
|
|
Interest-bearing liabilities
|
2,370
|
|
|
1,517
|
|
|
3,829
|
|
|
5,906
|
|
|
13,622
|
|
|||||
Finance lease liabilities
|
12
|
|
|
7
|
|
|
25
|
|
|
16
|
|
|
60
|
|
(1)
|
Excludes $1,321 million of decommissioning liabilities, other provisions, and post-employment benefits, $61 million of capital leases, and $62 million of loans and notes payable.
|
F-73
|
Brookfield Business Partners
|
|
|
December 31, 2019
|
||||||||||||||||||||||||||||||
|
|
USD
|
|
AUD
|
|
GBP
|
|
CAD
|
|
EUR
|
|
BRL
|
|
Other
|
|
Total
|
||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Current assets
|
|
$
|
5,215
|
|
|
$
|
628
|
|
|
$
|
2,015
|
|
|
$
|
1,253
|
|
|
$
|
903
|
|
|
$
|
707
|
|
|
$
|
2,074
|
|
|
$
|
12,795
|
|
Non-current assets
|
|
18,994
|
|
|
4,848
|
|
|
2,283
|
|
|
6,026
|
|
|
1,582
|
|
|
3,230
|
|
|
1,993
|
|
|
38,956
|
|
||||||||
|
|
$
|
24,209
|
|
|
$
|
5,476
|
|
|
$
|
4,298
|
|
|
$
|
7,279
|
|
|
$
|
2,485
|
|
|
3,937
|
|
|
$
|
4,067
|
|
|
$
|
51,751
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Current liabilities
|
|
$
|
3,439
|
|
|
$
|
1,184
|
|
|
$
|
2,343
|
|
|
$
|
1,336
|
|
|
$
|
1,147
|
|
|
$
|
471
|
|
|
$
|
1,104
|
|
|
$
|
11,024
|
|
Non-current liabilities
|
|
20,749
|
|
|
3,141
|
|
|
659
|
|
|
2,135
|
|
|
593
|
|
|
1,849
|
|
|
548
|
|
|
29,674
|
|
||||||||
|
|
$
|
24,188
|
|
|
$
|
4,325
|
|
|
$
|
3,002
|
|
|
$
|
3,471
|
|
|
$
|
1,740
|
|
|
$
|
2,320
|
|
|
$
|
1,652
|
|
|
$
|
40,698
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Non-controlling interest
|
|
752
|
|
|
641
|
|
|
426
|
|
|
2,578
|
|
|
427
|
|
|
1,173
|
|
|
1,264
|
|
|
7,261
|
|
||||||||
Net investment to the partnership
|
|
$
|
(731
|
)
|
|
$
|
510
|
|
|
$
|
870
|
|
|
$
|
1,230
|
|
|
$
|
318
|
|
|
$
|
444
|
|
|
$
|
1,151
|
|
|
$
|
3,792
|
|
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||
|
|
USD
|
|
AUD
|
|
GBP
|
|
CAD
|
|
EUR
|
|
BRL
|
|
Other
|
|
Total
|
||||||||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Current assets
|
|
$
|
3,636
|
|
|
$
|
402
|
|
|
$
|
2,197
|
|
|
$
|
1,186
|
|
|
$
|
658
|
|
|
$
|
480
|
|
|
$
|
1,222
|
|
|
$
|
9,781
|
|
Non-current assets
|
|
9,414
|
|
|
733
|
|
|
819
|
|
|
1,997
|
|
|
993
|
|
|
3,065
|
|
|
516
|
|
|
17,537
|
|
||||||||
|
|
$
|
13,050
|
|
|
$
|
1,135
|
|
|
$
|
3,016
|
|
|
$
|
3,183
|
|
|
$
|
1,651
|
|
|
3,545
|
|
|
$
|
1,738
|
|
|
$
|
27,318
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Current liabilities
|
|
$
|
2,886
|
|
|
$
|
551
|
|
|
$
|
2,514
|
|
|
$
|
1,232
|
|
|
$
|
592
|
|
|
$
|
314
|
|
|
$
|
927
|
|
|
$
|
9,016
|
|
Non-current liabilities
|
|
8,571
|
|
|
123
|
|
|
189
|
|
|
516
|
|
|
505
|
|
|
1,824
|
|
|
80
|
|
|
11,808
|
|
||||||||
|
|
$
|
11,457
|
|
|
$
|
674
|
|
|
$
|
2,703
|
|
|
$
|
1,748
|
|
|
$
|
1,097
|
|
|
$
|
2,138
|
|
|
$
|
1,007
|
|
|
$
|
20,824
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Non-controlling interest
|
|
1,060
|
|
|
52
|
|
|
171
|
|
|
750
|
|
|
383
|
|
|
1,052
|
|
|
63
|
|
|
3,531
|
|
||||||||
Net investment to the partnership
|
|
$
|
533
|
|
|
$
|
409
|
|
|
$
|
142
|
|
|
$
|
685
|
|
|
$
|
171
|
|
|
$
|
355
|
|
|
$
|
668
|
|
|
$
|
2,963
|
|
F-74
|
Brookfield Business Partners
|
|
December 31, 2019
|
|||||||||||||
(US$ MILLIONS)
|
|
OCI attributable to unitholders, before taxes
|
|
Pre-tax income attributable to unitholders
|
||||||||||
|
|
10% decrease
|
10% increase
|
|
10% decrease
|
10% increase
|
||||||||
Australian dollar
|
|
$
|
(44
|
)
|
$
|
44
|
|
|
$
|
2
|
|
$
|
(2
|
)
|
Canadian dollar
|
|
(60
|
)
|
60
|
|
|
1
|
|
(1
|
)
|
||||
Brazilian real
|
|
(44
|
)
|
44
|
|
|
(1
|
)
|
1
|
|
||||
Other
|
|
(133
|
)
|
133
|
|
|
(36
|
)
|
36
|
|
|
December 31, 2018
|
|||||||||||||
(US$ MILLIONS)
|
|
OCI attributable to unitholders, before taxes
|
|
Pre-tax income attributable to unitholders
|
||||||||||
|
|
10% decrease
|
10% increase
|
|
10% decrease
|
10% increase
|
||||||||
Australian dollar
|
|
$
|
(36
|
)
|
$
|
36
|
|
|
$
|
—
|
|
$
|
—
|
|
Canadian dollar
|
|
(12
|
)
|
12
|
|
|
(3
|
)
|
3
|
|
||||
Brazilian real
|
|
(35
|
)
|
35
|
|
|
(4
|
)
|
4
|
|
||||
Other
|
|
(19
|
)
|
19
|
|
|
(5
|
)
|
5
|
|
|
December 31, 2017
|
|||||||||||||
(US$ MILLIONS)
|
|
OCI attributable to unitholders, before taxes
|
|
Pre-tax income attributable to unitholders
|
||||||||||
|
|
10% decrease
|
10% increase
|
|
10% decrease
|
10% increase
|
||||||||
Australian dollar
|
|
$
|
(88
|
)
|
$
|
88
|
|
|
$
|
—
|
|
$
|
—
|
|
Canadian dollar
|
|
(37
|
)
|
33
|
|
|
—
|
|
—
|
|
||||
Brazilian real
|
|
(33
|
)
|
37
|
|
|
—
|
|
—
|
|
||||
Other
|
|
(9
|
)
|
9
|
|
|
20
|
|
(20
|
)
|
F-75
|
Brookfield Business Partners
|
F-76
|
Brookfield Business Partners
|
F-77
|
Brookfield Business Partners
|
|
Year Ended December 31, 2019
|
||||||||||||||||||
|
Total attributable to the partnership
|
||||||||||||||||||
(US$ MILLIONS)
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Corporate
and other |
|
Total
|
||||||||||
Revenues
|
$
|
28,822
|
|
|
$
|
4,559
|
|
|
$
|
9,651
|
|
|
$
|
—
|
|
|
$
|
43,032
|
|
Direct operating costs
|
(27,995
|
)
|
|
(3,231
|
)
|
|
(7,092
|
)
|
|
(9
|
)
|
|
(38,327
|
)
|
|||||
General and administrative expenses
|
(314
|
)
|
|
(133
|
)
|
|
(299
|
)
|
|
(86
|
)
|
|
(832
|
)
|
|||||
Equity accounted Company EBITDA (1)
|
38
|
|
|
109
|
|
|
94
|
|
|
—
|
|
|
241
|
|
|||||
Company EBITDA attributable to others (2)
|
(330
|
)
|
|
(836
|
)
|
|
(1,735
|
)
|
|
—
|
|
|
(2,901
|
)
|
|||||
Company EBITDA (3)
|
221
|
|
|
468
|
|
|
619
|
|
|
(95
|
)
|
|
1,213
|
|
|||||
Realized disposition gain (loss), net
|
528
|
|
|
(1
|
)
|
|
200
|
|
|
(1
|
)
|
|
726
|
|
|||||
Other income (expense), net (4)
|
—
|
|
|
(27
|
)
|
|
2
|
|
|
—
|
|
|
(25
|
)
|
|||||
Interest income (expense), net
|
(189
|
)
|
|
(381
|
)
|
|
(741
|
)
|
|
37
|
|
|
(1,274
|
)
|
|||||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments (1)
|
(7
|
)
|
|
(15
|
)
|
|
(20
|
)
|
|
—
|
|
|
(42
|
)
|
|||||
Current income taxes
|
(91
|
)
|
|
(4
|
)
|
|
(251
|
)
|
|
22
|
|
|
(324
|
)
|
|||||
Company FFO attributable to others (net of Company EBITDA attributable to others) (2)
|
(30
|
)
|
|
274
|
|
|
584
|
|
|
—
|
|
|
828
|
|
|||||
Company FFO (3)
|
432
|
|
|
314
|
|
|
393
|
|
|
(37
|
)
|
|
1,102
|
|
|||||
Depreciation and amortization expense (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,804
|
)
|
|||||
Impairment expense, net
|
|
|
|
|
|
|
|
|
|
|
|
|
(609
|
)
|
|||||
Other income (expense), net (4)
|
|
|
|
|
|
|
|
|
|
|
|
|
(375
|
)
|
|||||
Deferred income taxes
|
|
|
|
|
|
|
|
|
|
|
|
|
132
|
|
|||||
Non-cash items attributable to equity accounted investments (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
(85
|
)
|
|||||
Non-cash items attributable to others (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
1,727
|
|
|||||
Net income (loss) attributable to unitholders (3)
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
88
|
|
(1)
|
The sum of these amounts equates to equity accounted income of $114 million as per the consolidated statements of operating results.
|
(2)
|
The sum of these amounts equates to net income attributable to others of $346 million as per the consolidated statements of operating results.
|
(3)
|
Company EBITDA, Company FFO and net income attributable to unitholders include Company EBITDA, Company FFO and net income attributable to limited partnership unitholders, general partnership unitholders, redemption-exchange unitholders, and special limited partnership unitholders.
|
(4)
|
The sum of these amounts equates to the other expense, net of $400 million as per the consolidated statements of operating results.
|
(5)
|
For the year ended December 31, 2019, depreciation and amortization by segment is as follows: infrastructure services $686 million, business services $305 million, industrials $813 million, and corporate and other $nil.
|
F-78
|
Brookfield Business Partners
|
|
Year Ended December 31, 2018
|
||||||||||||||||||
|
Total attributable to the partnership
|
||||||||||||||||||
(US$ MILLIONS)
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Corporate
and other |
|
Total
|
||||||||||
Revenues
|
$
|
30,847
|
|
|
$
|
2,418
|
|
|
$
|
3,896
|
|
|
$
|
7
|
|
|
$
|
37,168
|
|
Direct operating costs
|
(30,351
|
)
|
|
(1,715
|
)
|
|
(2,060
|
)
|
|
(8
|
)
|
|
(34,134
|
)
|
|||||
General and administrative expenses
|
(278
|
)
|
|
(65
|
)
|
|
(231
|
)
|
|
(69
|
)
|
|
(643
|
)
|
|||||
Equity accounted Company EBITDA (1)
|
34
|
|
|
120
|
|
|
42
|
|
|
—
|
|
|
196
|
|
|||||
Company EBITDA attributable to others (2)
|
(124
|
)
|
|
(463
|
)
|
|
(1,157
|
)
|
|
—
|
|
|
(1,744
|
)
|
|||||
Company EBITDA (3)
|
128
|
|
|
295
|
|
|
490
|
|
|
(70
|
)
|
|
843
|
|
|||||
Realized disposition gain (loss), net (5)
|
55
|
|
|
—
|
|
|
195
|
|
|
—
|
|
|
250
|
|
|||||
Other income (expense), net
|
—
|
|
|
(15
|
)
|
|
(3
|
)
|
|
—
|
|
|
(18
|
)
|
|||||
Interest income (expense), net
|
(66
|
)
|
|
(176
|
)
|
|
(263
|
)
|
|
7
|
|
|
(498
|
)
|
|||||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments (1)
|
(3
|
)
|
|
(41
|
)
|
|
(10
|
)
|
|
—
|
|
|
(54
|
)
|
|||||
Current income taxes
|
(44
|
)
|
|
(10
|
)
|
|
(132
|
)
|
|
—
|
|
|
(186
|
)
|
|||||
Company FFO attributable to others (net of Company EBITDA attributable to others) (2)
|
61
|
|
|
142
|
|
|
193
|
|
|
—
|
|
|
396
|
|
|||||
Company FFO (3)
|
131
|
|
|
195
|
|
|
470
|
|
|
(63
|
)
|
|
733
|
|
|||||
Depreciation and amortization expense (4)
|
|
|
|
|
|
|
|
|
|
|
|
(748
|
)
|
||||||
Gain on acquisition / disposition (5)
|
|
|
|
|
|
|
|
|
250
|
|
|||||||||
Impairment expense, net
|
|
|
|
|
|
|
|
|
|
|
|
(218
|
)
|
||||||
Other income (expense), net
|
|
|
|
|
|
|
|
|
|
|
|
(118
|
)
|
||||||
Deferred income taxes
|
|
|
|
|
|
|
|
|
|
|
|
88
|
|
||||||
Non-cash items attributable to equity accounted investments (1)
|
|
|
|
|
|
|
|
|
|
|
|
(132
|
)
|
||||||
Non-cash items attributable to others (2)
|
|
|
|
|
|
|
|
|
|
|
|
567
|
|
||||||
Net income (loss) attributable to unitholders (3)
|
|
|
|
|
|
|
|
|
|
|
|
422
|
|
(1)
|
The sum of these amounts equates to equity accounted income of $10 million as per the consolidated statements of operating results.
|
(2)
|
The sum of these amounts equates to net income attributable to others of $781 million as per the consolidated statements of operating results.
|
(3)
|
Company EBITDA, Company FFO and net income attributable to unitholders include Company EBITDA, Company FFO and net income attributable to limited partnership unitholders, general partnership unitholders, redemption-exchange unitholders, and special limited partnership unitholders.
|
(4)
|
For the year ended December 31, 2018, depreciation and amortization by segment is as follows; infrastructure services $309 million, business services $135 million, industrials $304 million, corporate and other $nil.
|
(5)
|
The sum of these amounts equates to the gain on acquisitions/dispositions, net of $500 million as per the consolidated statements of operating results.
|
F-79
|
Brookfield Business Partners
|
|
Year Ended December 31, 2017
|
||||||||||||||||||
|
Total attributable to the partnership
|
||||||||||||||||||
(US$ MILLIONS)
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
Revenues
|
$
|
20,874
|
|
|
$
|
3
|
|
|
$
|
1,939
|
|
|
$
|
7
|
|
|
$
|
22,823
|
|
Direct operating costs
|
(20,448
|
)
|
|
—
|
|
|
(1,425
|
)
|
|
(3
|
)
|
|
(21,876
|
)
|
|||||
General and administrative expenses
|
(182
|
)
|
|
—
|
|
|
(113
|
)
|
|
(45
|
)
|
|
(340
|
)
|
|||||
Equity accounted Company EBITDA (1)
|
28
|
|
|
31
|
|
|
49
|
|
|
—
|
|
|
108
|
|
|||||
Company EBITDA attributable to others (2)
|
(169
|
)
|
|
—
|
|
|
(306
|
)
|
|
—
|
|
|
(475
|
)
|
|||||
Company EBITDA (3)
|
103
|
|
|
34
|
|
|
144
|
|
|
(41
|
)
|
|
240
|
|
|||||
Realized disposition gain/(loss), net (5)
|
19
|
|
|
—
|
|
|
225
|
|
|
—
|
|
|
244
|
|
|||||
Interest income (expense), net
|
(47
|
)
|
|
—
|
|
|
(154
|
)
|
|
(1
|
)
|
|
(202
|
)
|
|||||
Realized disposition gain, current income taxes and interest expenses related to equity accounted investments (1)
|
—
|
|
|
(13
|
)
|
|
(4
|
)
|
|
—
|
|
|
(17
|
)
|
|||||
Current income taxes
|
(16
|
)
|
|
—
|
|
|
(32
|
)
|
|
18
|
|
|
(30
|
)
|
|||||
Company FFO attributable to others (net of Company EBITDA attributable to others) (2)
|
33
|
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
17
|
|
|||||
Company FFO (3)
|
92
|
|
|
21
|
|
|
163
|
|
|
(24
|
)
|
|
252
|
|
|||||
Depreciation and amortization expense (4)
|
|
|
|
|
|
|
|
|
|
|
|
(371
|
)
|
||||||
Realized disposition gains recorded in fair value changes or prior periods (5)
|
|
|
|
|
|
|
|
|
23
|
|
|||||||||
Impairment expense, net
|
|
|
|
|
|
|
|
|
|
|
|
(39
|
)
|
||||||
Other income (expense), net
|
|
|
|
|
|
|
|
|
|
|
|
(108
|
)
|
||||||
Deferred income taxes
|
|
|
|
|
|
|
|
|
|
|
|
22
|
|
||||||
Non-cash items attributable to equity accounted investments (1)
|
|
|
|
|
|
|
|
|
|
|
|
(22
|
)
|
||||||
Non-cash items attributable to others (2)
|
|
|
|
|
|
|
|
|
|
|
|
267
|
|
||||||
Net income (loss) attributable to parent (3)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
24
|
|
(1)
|
The sum of these amounts equates to equity accounted income of $69 million as per the consolidated statements of operating results.
|
(2)
|
The sum of these amounts equates to net income attributable to others of $191 million as per the consolidated statements of operating results.
|
(3)
|
Company EBITDA, Company FFO and net income attributable to unitholders include Company EBITDA, Company FFO and net income attributable to limited partnership unitholders, general partnership unitholders, redemption-exchange unitholders, and special limited partnership unitholders.
|
(4)
|
For the year ended December 31, 2017, depreciation and amortization by segment is as follows: infrastructure services $nil, business services $99 million, industrials $272 million, and corporate and other $nil.
|
(5)
|
The sum of these amounts equates to the gain on acquisitions/dispositions, net of $267 million as per the consolidated statements of operating results.
|
F-80
|
Brookfield Business Partners
|
|
|
As at December 31, 2019
|
||||||||||||||||||
|
|
Total attributable to the partnership
|
||||||||||||||||||
(US$ MILLIONS)
|
|
Business
services
|
|
Infrastructure
services
|
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
Total assets
|
|
$
|
18,132
|
|
|
$
|
10,619
|
|
|
$
|
22,742
|
|
|
$
|
258
|
|
|
$
|
51,751
|
|
|
|
As at December 31, 2018
|
||||||||||||||||||
|
|
Total attributable to the partnership
|
||||||||||||||||||
(US$ MILLIONS)
|
|
Business
services
|
|
Infrastructure
services |
|
Industrials
|
|
Corporate
and other
|
|
Total
|
||||||||||
Total assets
|
|
$
|
7,613
|
|
|
$
|
11,640
|
|
|
$
|
7,650
|
|
|
$
|
415
|
|
|
$
|
27,318
|
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
United Kingdom
|
|
$
|
20,202
|
|
|
$
|
21,983
|
|
|
$
|
13,637
|
|
United States of America
|
|
5,218
|
|
|
1,772
|
|
|
655
|
|
|||
Europe
|
|
5,145
|
|
|
2,909
|
|
|
411
|
|
|||
Australia
|
|
4,059
|
|
|
2,961
|
|
|
2,884
|
|
|||
Canada
|
|
3,860
|
|
|
4,691
|
|
|
3,273
|
|
|||
Other
|
|
2,050
|
|
|
969
|
|
|
711
|
|
|||
Brazil
|
|
1,800
|
|
|
1,736
|
|
|
1,252
|
|
|||
Mexico
|
|
698
|
|
|
147
|
|
|
—
|
|
|||
Total revenues
|
|
$
|
43,032
|
|
|
$
|
37,168
|
|
|
$
|
22,823
|
|
F-81
|
Brookfield Business Partners
|
Geography
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(US$ MILLIONS)
|
|
Business services
|
|
Infrastructure services
|
|
Industrials
|
|
Corporate
and other
|
|
Total (1)
|
||||||||||
United Kingdom
|
|
$
|
19,697
|
|
|
$
|
377
|
|
|
$
|
128
|
|
|
$
|
—
|
|
|
$
|
20,202
|
|
United States of America
|
|
324
|
|
|
1,609
|
|
|
3,285
|
|
|
—
|
|
|
5,218
|
|
|||||
Europe
|
|
687
|
|
|
1,569
|
|
|
2,889
|
|
|
—
|
|
|
5,145
|
|
|||||
Australia
|
|
4,042
|
|
|
17
|
|
|
—
|
|
|
—
|
|
|
4,059
|
|
|||||
Canada
|
|
2,990
|
|
|
117
|
|
|
753
|
|
|
—
|
|
|
3,860
|
|
|||||
Other
|
|
626
|
|
|
618
|
|
|
806
|
|
|
—
|
|
|
2,050
|
|
|||||
Brazil
|
|
456
|
|
|
247
|
|
|
1,097
|
|
|
—
|
|
|
1,800
|
|
|||||
Mexico
|
|
—
|
|
|
5
|
|
|
693
|
|
|
—
|
|
|
698
|
|
|||||
Total
|
|
$
|
28,822
|
|
|
$
|
4,559
|
|
|
$
|
9,651
|
|
|
$
|
—
|
|
|
$
|
43,032
|
|
(1)
|
Geography of the other non IFRS 15 revenue is as follows: United Kingdom $46 million, Canada $103 million, Australia $3 million, Brazil $201 million, United States of America $7 million, Europe $330 million and Other $34 million.
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
United Kingdom
|
|
$
|
2,182
|
|
|
$
|
2,032
|
|
United States of America
|
|
8,214
|
|
|
3,823
|
|
||
Europe
|
|
7,141
|
|
|
3,765
|
|
||
Australia
|
|
5,110
|
|
|
746
|
|
||
Canada
|
|
6,610
|
|
|
2,403
|
|
||
Other
|
|
2,588
|
|
|
416
|
|
||
Brazil
|
|
4,582
|
|
|
4,205
|
|
||
Mexico
|
|
2,529
|
|
|
147
|
|
||
Total non-current assets
|
|
$
|
38,956
|
|
|
$
|
17,537
|
|
(1)
|
Non-current assets are comprised of property, plant and equipment, intangible assets, equity accounted investments, goodwill and other non-current assets.
|
|
|
Year Ended December 31
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Interest paid
|
|
$
|
1,079
|
|
|
$
|
456
|
|
|
$
|
103
|
|
Income taxes paid
|
|
$
|
190
|
|
|
$
|
112
|
|
|
$
|
41
|
|
F-82
|
Brookfield Business Partners
|
|
|
Year Ended December 31
|
||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2017
|
||||||
Accounts receivable
|
|
$
|
(70
|
)
|
|
$
|
(11
|
)
|
|
$
|
(520
|
)
|
Inventory
|
|
78
|
|
|
153
|
|
|
(259
|
)
|
|||
Prepayments and other
|
|
(11
|
)
|
|
(89
|
)
|
|
185
|
|
|||
Accounts payable and other
|
|
119
|
|
|
(322
|
)
|
|
143
|
|
|||
Changes in non-cash working capital, net
|
|
$
|
116
|
|
|
$
|
(269
|
)
|
|
$
|
(451
|
)
|
(US$ MILLIONS)
|
|
2019
|
|
2018
|
||||
Balance at beginning of year
|
|
$
|
10,866
|
|
|
$
|
3,265
|
|
Cash flows
|
|
11,378
|
|
|
4,568
|
|
||
Non-cash changes:
|
|
|
|
|
||||
Acquisitions / (dispositions) of subsidiaries
|
|
357
|
|
|
3,258
|
|
||
Foreign currency translation
|
|
(9
|
)
|
|
(299
|
)
|
||
Fair value
|
|
(19
|
)
|
|
43
|
|
||
Held for sale (1)
|
|
(305
|
)
|
|
—
|
|
||
Other changes
|
|
131
|
|
|
31
|
|
||
Balance at end of year
|
|
$
|
22,399
|
|
|
$
|
10,866
|
|
(1)
|
Includes liabilities that were reclassified as held for sale and subsequently disposed. See Note 8 and Note 9 for additional information.
|
F-83
|
Brookfield Business Partners
|
|
|
Defined benefit pension plan
|
|
Post-retirement
plan
|
||||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Changes in defined benefit obligation
|
|
|
|
|
|
|
|
|
||||||||
Defined benefit obligation at beginning of year
|
|
$
|
2,037
|
|
|
$
|
164
|
|
|
$
|
68
|
|
|
$
|
28
|
|
Defined benefit obligation through business combinations
|
|
514
|
|
|
1,923
|
|
|
25
|
|
|
45
|
|
||||
Service cost
|
|
30
|
|
|
10
|
|
|
1
|
|
|
1
|
|
||||
Interest cost
|
|
88
|
|
|
35
|
|
|
3
|
|
|
2
|
|
||||
Participant contributions
|
|
3
|
|
|
1
|
|
|
3
|
|
|
1
|
|
||||
Insurance premiums for risk benefits
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
||||
Foreign currency exchange differences
|
|
20
|
|
|
(12
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Actuarial gain due to financial assumption changes
|
|
337
|
|
|
(39
|
)
|
|
15
|
|
|
(2
|
)
|
||||
Actuarial gain due to demographic assumption changes
|
|
(14
|
)
|
|
(3
|
)
|
|
1
|
|
|
—
|
|
||||
Actuarial experience adjustments
|
|
25
|
|
|
2
|
|
|
(1
|
)
|
|
—
|
|
||||
Benefits paid from plan assets
|
|
(91
|
)
|
|
(36
|
)
|
|
(2
|
)
|
|
(1
|
)
|
||||
Benefits paid from employer
|
|
(22
|
)
|
|
(6
|
)
|
|
(7
|
)
|
|
(4
|
)
|
||||
Defined benefit obligation at end of year
|
|
$
|
2,927
|
|
|
$
|
2,037
|
|
|
$
|
106
|
|
|
$
|
68
|
|
|
|
|
|
|
|
|
|
|
||||||||
Changes in fair value of plan assets
|
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of year
|
|
$
|
(1,542
|
)
|
|
$
|
(126
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Fair value of plan assets through business combinations
|
|
(398
|
)
|
|
(1,438
|
)
|
|
(4
|
)
|
|
—
|
|
||||
Interest income
|
|
(68
|
)
|
|
(29
|
)
|
|
—
|
|
|
—
|
|
||||
Return on plan assets (excluding interest income)
|
|
(241
|
)
|
|
112
|
|
|
—
|
|
|
—
|
|
||||
Foreign currency exchange differences
|
|
(9
|
)
|
|
10
|
|
|
(2
|
)
|
|
—
|
|
||||
Employer contributions
|
|
(51
|
)
|
|
(118
|
)
|
|
(4
|
)
|
|
(1
|
)
|
||||
Participant contributions
|
|
(3
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|
(1
|
)
|
||||
Employer direct settlements
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
1
|
|
||||
Benefits paid from plan assets
|
|
91
|
|
|
41
|
|
|
2
|
|
|
2
|
|
||||
Benefits paid from employer
|
|
19
|
|
|
1
|
|
|
7
|
|
|
(1
|
)
|
||||
Administrative expenses paid from plan assets
|
|
9
|
|
|
7
|
|
|
—
|
|
|
—
|
|
||||
Insurance premiums for risk benefits
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Fair value of plan assets at year end
|
|
$
|
(2,194
|
)
|
|
$
|
(1,542
|
)
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
Net liability at end of year
|
|
$
|
733
|
|
|
$
|
495
|
|
|
$
|
102
|
|
|
$
|
68
|
|
F-84
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
United States of America
|
|
Canada
|
|
Other
|
|
Total
|
||||||||
Defined benefit pension plan
|
|
|
|
|
|
|
|
|
||||||||
Defined benefit obligation
|
|
$
|
2,290
|
|
|
$
|
30
|
|
|
$
|
607
|
|
|
$
|
2,927
|
|
Fair value of plan assets
|
|
(1,763
|
)
|
|
(4
|
)
|
|
(427
|
)
|
|
(2,194
|
)
|
||||
Net liability
|
|
$
|
527
|
|
|
$
|
26
|
|
|
$
|
180
|
|
|
$
|
733
|
|
|
|
|
|
|
|
|
|
|
||||||||
Post-retirement plan - net liability
|
|
|
|
|
|
|
|
|
||||||||
Defined benefit obligation at end of year
|
|
$
|
62
|
|
|
$
|
28
|
|
|
$
|
16
|
|
|
$
|
106
|
|
Fair value of plans assets
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
||||
Net liability
|
|
$
|
58
|
|
|
$
|
28
|
|
|
$
|
16
|
|
|
$
|
102
|
|
(US$ MILLIONS)
|
|
United States of America
|
|
Canada
|
|
Other
|
|
Total
|
||||||||
Defined benefit pension plan
|
|
|
|
|
|
|
|
|
||||||||
Defined benefit obligation
|
|
$
|
1,573
|
|
|
$
|
4
|
|
|
$
|
460
|
|
|
$
|
2,037
|
|
Fair value of plan assets
|
|
(1,211
|
)
|
|
(3
|
)
|
|
(328
|
)
|
|
(1,542
|
)
|
||||
Net liability
|
|
$
|
362
|
|
|
$
|
1
|
|
|
$
|
132
|
|
|
$
|
495
|
|
|
|
|
|
|
|
|
|
|
||||||||
Post-retirement plan - net liability
|
|
|
|
|
|
|
|
|
||||||||
Defined benefit obligation at end of year
|
|
$
|
49
|
|
|
$
|
12
|
|
|
$
|
7
|
|
|
$
|
68
|
|
F-85
|
Brookfield Business Partners
|
|
|
Defined benefit pension plan
|
|
Post-retirement
plan
|
||||||||||||
(US$ MILLIONS)
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Amounts recognized in profit and loss
|
|
|
|
|
|
|
|
|
||||||||
Current service cost
|
|
$
|
30
|
|
|
$
|
11
|
|
|
$
|
1
|
|
|
$
|
—
|
|
Net interest expense
|
|
20
|
|
|
6
|
|
|
3
|
|
|
2
|
|
||||
Administrative expense
|
|
9
|
|
|
7
|
|
|
—
|
|
|
—
|
|
||||
Total expense recognized in profit and loss
|
|
$
|
59
|
|
|
$
|
24
|
|
|
$
|
4
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
|
|
||||||||
Amounts recognized in other comprehensive income
|
|
|
|
|
|
|
|
|
||||||||
Return on plan assets (excluding amounts included in net interest expense)
|
|
$
|
(241
|
)
|
|
$
|
113
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Actuarial gains and losses arising from changes in demographic assumptions
|
|
(14
|
)
|
|
(4
|
)
|
|
1
|
|
|
—
|
|
||||
Actuarial gains and losses arising from changes in financial assumptions
|
|
337
|
|
|
(39
|
)
|
|
15
|
|
|
(2
|
)
|
||||
Actuarial gains and losses arising from experience adjustments
|
|
25
|
|
|
2
|
|
|
(1
|
)
|
|
—
|
|
||||
Total expense (gain) recognized in other comprehensive income
|
|
$
|
107
|
|
|
$
|
72
|
|
|
$
|
15
|
|
|
$
|
(2
|
)
|
Total expense (gain) recognized in comprehensive income
|
|
$
|
166
|
|
|
$
|
96
|
|
|
$
|
19
|
|
|
$
|
—
|
|
F-86
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Level 1
|
|
Level 2 (1)
|
|
Level 3 (2)
|
|
Total
|
||||||||
Cash and cash equivalents
|
|
$
|
41
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
41
|
|
Equity instruments
|
|
1,185
|
|
|
243
|
|
|
—
|
|
|
1,428
|
|
||||
Debt instruments
|
|
28
|
|
|
406
|
|
|
149
|
|
|
583
|
|
||||
Real Estate
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
||||
Derivatives
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Investment funds
|
|
—
|
|
|
106
|
|
|
—
|
|
|
106
|
|
||||
Fixed insurance contracts
|
|
14
|
|
|
—
|
|
|
18
|
|
|
32
|
|
||||
Total plan assets
|
|
$
|
1,268
|
|
|
$
|
763
|
|
|
$
|
167
|
|
|
$
|
2,198
|
|
(1)
|
Level 2 assets represent the net asset value of the underlying assets held by the investment fund. The assets are valued by the fund administrator.
|
(2)
|
Level 3 assets consist of insurance rights and equity and debt instruments pooled in an actively invested collective profit sharing arrangement with other third-party employers. The assets are valued using non-observable inputs by the plan administrator.
|
Discount rate
|
0.2% to 3.6%
|
Rate of compensation increase
|
1.3% to 3.6%
|
Discount rate
|
0.2% to 4.7%
|
Health care cost trend on covered charges:
|
|
Immediate trend rate
|
0.2% to 7.3%
|
Ultimate trend rate
|
0.2% to 5.8%
|
(US$ MILLIONS)
|
|
Percentage increase
|
|
Impact on liability
|
|
Percentage decrease
|
|
Impact on liability
|
||||
Defined benefit pension plan
|
|
|
|
|
|
|
|
|
||||
Discount rate
|
|
0.25% to 1%
|
|
$
|
(217
|
)
|
|
0.25% to 1%
|
|
$
|
251
|
|
Rate of compensation increase
|
|
0.25% to 1%
|
|
34
|
|
|
0.25% to 1%
|
|
(31
|
)
|
||
|
|
|
|
|
|
|
|
|
||||
Post-retirement plan
|
|
|
|
|
|
|
|
|
||||
Discount rate
|
|
0.25% to 1%
|
|
$
|
(28
|
)
|
|
0.25% to 1%
|
|
$
|
33
|
|
Health care cost trend rates
|
|
0.5% to 1%
|
|
3
|
|
|
0.5% to 1%
|
|
(2
|
)
|
F-87
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
Defined benefit pension plan
|
|
Post-retirement plan
|
|
Total
|
||||||
2020
|
|
$
|
120
|
|
|
$
|
7
|
|
|
$
|
127
|
|
2021
|
|
126
|
|
|
7
|
|
|
133
|
|
|||
2022
|
|
129
|
|
|
7
|
|
|
136
|
|
|||
2023
|
|
132
|
|
|
7
|
|
|
139
|
|
|||
2024
|
|
137
|
|
|
7
|
|
|
144
|
|
|||
Thereafter
|
|
754
|
|
|
70
|
|
|
824
|
|
|||
Total
|
|
$
|
1,398
|
|
|
$
|
105
|
|
|
$
|
1,503
|
|
(US$ MILLIONS)
|
|
2019
|
||
Unearned premium reserves, beginning of year
|
|
$
|
—
|
|
Acquisitions through business combinations
|
|
1,603
|
|
|
Premiums written during the year
|
|
26
|
|
|
Premiums earned during the year
|
|
(28
|
)
|
|
Foreign currency translation
|
|
24
|
|
|
Unearned premium reserves, end of year
|
|
$
|
1,625
|
|
F-88
|
Brookfield Business Partners
|
(US$ MILLIONS)
|
|
2019
|
||
Case reserves
|
|
$
|
69
|
|
Incurred but not reported reserves
|
|
30
|
|
|
Discounting
|
|
(1
|
)
|
|
Provisions for adverse deviation
|
|
7
|
|
|
Total loss reserves
|
|
$
|
105
|
|
(US$ MILLIONS)
|
|
2019
|
||
Loss reserves, beginning of year
|
|
$
|
—
|
|
Acquisitions through business combinations
|
|
104
|
|
|
Claims paid during the year
|
|
(5
|
)
|
|
Losses on claims related to the current year
|
|
5
|
|
|
Favorable development on losses on claims related to prior years
|
|
—
|
|
|
Foreign currency translation
|
|
1
|
|
|
Loss reserves, end of year
|
|
$
|
105
|
|
F-89
|
Brookfield Business Partners
|
1.
|
enlarge the obligations of any limited partner without its consent, except that any amendment that would have a material adverse effect on the rights or preferences of any class of partnership interests in relation to other classes of partnership interests may be consented to or approved by at least a majority of the type or class of partnership interests so affected; or
|
2.
|
enlarge the obligations of, restrict in any way any action by or rights of or reduce in any way the amounts distributable, reimbursable or otherwise payable by our company to the BBU General Partner or any of its affiliates without the consent of the BBU General Partner, which may be given or withheld in its sole discretion.
|
1.
|
a change in the name of our company, the location of our registered office or our registered agent;
|
2.
|
the admission, substitution or withdrawal of partners in accordance with our Limited Partnership Agreement;
|
3.
|
a change that the BBU General Partner determines is reasonable and necessary or appropriate for our company to qualify or to continue our company’s qualification as an exempted limited partnership under the laws of Bermuda or a partnership in which the limited partners have limited liability under the laws of any jurisdiction, or is necessary or advisable in the opinion of the BBU General Partner to ensure that our company will not be treated as an association taxable as a corporation or otherwise taxed as an entity for tax purposes;
|
4.
|
an amendment that the BBU General Partner determines to be necessary or appropriate to address changes in tax regulations, legislation or interpretation;
|
5.
|
an amendment that is necessary, in the opinion of our counsel, to prevent our company or the BBU General Partner or its directors or officers from in any manner being subjected to the provisions of the U.S. Investment Company Act of 1940, as amended (the “Investment Company Act”), or similar legislation in other jurisdictions;
|
6.
|
an amendment that the BBU General Partner determines in its sole discretion to be necessary or appropriate in connection with the creation, authorization or issuance of any class or series of partnership interests or options, rights, warrants or appreciation rights relating to partnership securities;
|
7.
|
any amendment expressly permitted in our Limited Partnership Agreement to be made by the BBU General Partner acting alone;
|
8.
|
any amendment that the BBU General Partner determines in its sole discretion to be necessary or appropriate to reflect and account for the formation by our company of, or its investment in, any corporation, partnership, joint venture, limited liability company or other entity, as otherwise permitted by our Limited Partnership Agreement;
|
9.
|
a change in our company’s fiscal year and related changes; or
|
10.
|
any other amendments substantially similar to any of the matters described in (1) through (9) above.
|
1.
|
do not adversely affect our company’s limited partners considered as a whole (including any particular class of partnership interests as compared to other classes of partnership interests) in any material respect;
|
2.
|
are necessary or appropriate to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any governmental agency or judicial authority;
|
3.
|
are necessary or appropriate to facilitate the trading of our units or to comply with any rule, regulation, guideline or requirement of any securities exchange on which our units or any other partnership interests are or will be listed for trading;
|
4.
|
are necessary or appropriate for any action taken by the BBU General Partner relating to splits or combinations of units under the provisions of our Limited Partnership Agreement; or
|
5.
|
are required to effect the intent expressed in the final registration statement and prospectus filed in connection with the spin-off or the intent of the provisions of our Limited Partnership Agreement or are otherwise contemplated by our Limited Partnership Agreement.
|
•
|
executed our Limited Partnership Agreement and become bound by the terms thereof;
|
•
|
granted an irrevocable power of attorney to the BBU General Partner or the liquidator of our company and any officer thereof to act as such partner’s agent and attorney-in-fact to execute, swear to, acknowledge, deliver, file and record in the appropriate public offices: (i) all certificates, documents or other instruments relating to the existence or qualification of our company as an exempted limited partnership (or a partnership in which the limited partners have limited liability) in Bermuda and in all jurisdictions in which our company may conduct activities and affairs or own property; any amendment, change, modification or restatement of our Limited Partnership Agreement, subject to the requirements of our Limited Partnership Agreement; the dissolution and liquidation of our company; the admission or withdrawal of any partner of our company or any capital contribution of any partner of our company; the determination of the rights, preferences and privileges of any class or series of units or other partnership interests of
|
•
|
made the consents and waivers contained in our Limited Partnership Agreement, including with respect to the approval of the transactions and agreements entered into in connection with our formation and the spin-off; and
|
•
|
ratified and confirmed all contracts, agreements, assignments and instruments entered into on behalf of our company in accordance with our Limited Partnership Agreement, including the granting of any charge or security interest over the assets of our company and the assumption of any indebtedness in connection with the affairs of our company.
|
Exhibit A
|
FORM OF BORROWING REQUEST
|
Exhibit B
|
FORM OF COMPLIANCE CERTIFICATE
|
Exhibit C
|
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
|
Exhibit C-2
|
FORM OF U.S. TAX COMPLIANCE CERTIFICATE
|
Type of Loan
|
Applicable Margin
|
Canadian Prime Rate
|
2.45%
|
U.S. Base Rate
|
2.45%
|
B/As
|
3.45%
|
LIBOR
|
3.45%
|
(a)
|
any interest swap agreement, forward rate agreement, floor, cap or collar agreement, futures or options, insurance or other similar agreement or arrangement, or any combination thereof, entered into or guaranteed by such Person where the subject matter of the same is interest rates or the price, value, or amount payable thereunder is dependent or based upon the interest rates or fluctuations in interest rates in effect from time to time (but, for certainty, shall exclude conventional floating rate debt);
|
(b)
|
any currency swap agreement, cross-currency agreement, forward agreement, floor, cap or collar agreement, futures or options, insurance or other similar agreement or arrangement, or any combination thereof, entered into or guaranteed by such Person where the subject matter of the same is currency exchange rates or the price, value or amount payable thereunder is dependent or based upon currency exchange rates or fluctuations in currency exchange rates in effect from time to time;
|
(c)
|
any agreement, whether financial or physical, for the purchase, sale, exchange, making or taking of any commodity (including natural gas, oil, electricity, coal, emission credits or other energy products), any commodity swap agreement, floor, cap or collar agreement or commodity future or option or other similar agreements or arrangements, or any combination thereof, entered into or guaranteed by such Person where the subject matter of the same is any commodity or the price, value or amount payable thereunder is dependent or based upon the price of any commodity or fluctuations in the price of any commodity in effect from time to time; and
|
(d)
|
any derivative transaction.
|
Exhibit A
|
Form of Borrowing Request
|
Exhibit B
|
Form of Compliance Certificate
|
Exhibit C
|
Form of U.S. Tax Compliance Certificates
|
(a)
|
with respect to Borrowing Requests or notices under Section 2.7: BPEG US Inc.
|
(b)
|
with respect to all other notices and communications: BPEG US Inc.
|
|
|
BROOKFIELD BUSINESS L.P., by its managing general partner, BROOKFIELD BUSINESS PARTNERS L.P., by its general partner, BROOKFIELD BUSINESS PARTNERS LIMITED
|
|
Per:
|
/s/ JANE SHEERE
|
||
|
Name: Jane Sheere
|
||
|
Title: Secretary
|
|
|
BROOKFIELD BBP CANADA HOLDINGS INC.
|
|
Per:
|
/s/ A.J. SILBER
|
||
|
Name: A.J. Silber
|
||
|
Title: Vice-President and Secretary
|
|
|
BROOKFIELD BBP BERMUDA HOLDINGS LIMITED
|
|
Per:
|
/s/ JANE SHEERE
|
||
|
Name: Jane Sheere
|
||
|
Title: Secretary
|
|
|
BROOKFIELD BBP US HOLDINGS LLC
|
|
Per:
|
/s/ MARK WEINBERG
|
||
|
Name: Mark Weinberg
|
||
|
Title: Managing Partner
|
|
|
BROOKFIELD BUSINESS PARTNERS L.P., by its general partner, BROOKFIELD BUSINESS PARTNERS LIMITED
|
|
Per:
|
/s/ JANE SHEERE
|
||
|
Name: Jane Sheere
|
||
|
Title: Secretary
|
|
|
BPEG US INC.
|
|
Per:
|
/s/ A.J. SILBER
|
||
|
Name: A.J. Silber
|
||
|
Title: Vice-President and Secretary
|
||
|
|
||
Per:
|
|
||
|
Name:
|
||
|
Title:
|
n
|
Per:
|
Name:
|
Title:
|
RE:
|
Third Amended and Restated Credit Agreement dated as of August 26, 2019, between Brookfield Business L.P., Brookfield BBP Canada Holdings Inc., Brookfield BBP Bermuda Holdings Limited, Brookfield BBP US Holdings LLC and such other persons as may become parties thereto as Borrowers from time to time, as Borrowers, Brookfield Business Partners L.P., as Guarantor, and BPEG US Inc., as Lender, as may be amended, supplemented or restated from time to time (the “Credit Agreement”). Capitalized terms used herein and not otherwise defined herein shall have the meaning assigned to such terms in the Credit Agreement.
|
[NAME OF BORROWER]
|
Per:
|
Name:
|
Title:
|
[NAME OF LENDER]
|
By:
|
Name:
|
Title:
|
[NAME OF LENDER]
|
By:
|
Name:
|
Title:
|
1.
|
I have reviewed this Annual Report on Form 20-F of Brookfield Business Partners L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by the Annual Report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Dated: March 5, 2020
|
|
|
|
|
|
/s/ Cyrus Madon
|
|
|
Name:
|
Cyrus Madon
|
|
Title:
|
Chief Executive Officer, Brookfield Business Partners L.P.
|
|
1.
|
I have reviewed this Annual Report on Form 20-F of Brookfield Business Partners L.P.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by the Annual Report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting
|
Dated: March 5, 2020
|
|
|
|
|
|
/s/ Jaspreet Dehl
|
|
|
Name:
|
Jaspreet Dehl
|
|
Title:
|
Chief Financial Officer, Brookfield Business Partners L.P.
|
|
Dated: March 5, 2020
|
|
|
|
|
|
/s/ Cyrus Madon
|
|
|
Name:
|
Cyrus Madon
|
|
Title:
|
Chief Executive Officer, Brookfield Business Partners L.P.
|
|
Dated: March 5, 2020
|
|
|
|
|
|
/s/ Jaspreet Dehl
|
|
|
Name:
|
Jaspreet Dehl
|
|
Title:
|
Chief Financial Officer, Brookfield Business Partners L.P.
|
|