BHP Billiton Ltd. (BHP) | Analysis of Investments

Investment Accounting Policy

Available for sale and trading investments

Available for sale and trading investments are measured at fair value. Gains and losses on the remeasurement of trading investments are recognized directly in the income statement. Gains and losses on the remeasurement of available for sale investments are recognized directly in equity and subsequently recognized in the income statement when realized by sale or redemption, or when a reduction in fair value is judged to represent an impairment.

Jointly controlled entities

A jointly controlled entity is a corporation, partnership or other entity in which each participant holds an interest. A jointly controlled entity operates in the same way as other entities, controlling the assets of the joint venture, earning its own income and incurring its own liabilities and expenses. Interests in jointly controlled entities are accounted for using the proportionate consolidation method, whereby BHP Billiton’s proportionate interest in the assets, liabilities, revenues and expenses of jointly controlled entities are recognized within each applicable line item of the financial statements. The share of jointly controlled entities’ results is recognized in BHP Billiton’s financial statements from the date that joint control commences until the date at which it ceases.

Source: BHP Billiton Ltd., Annual Report

Adjustment to Net Income (Loss): Mark to Market Available-for-sale Securities

BHP Billiton Ltd., adjustment to Profit After Taxation Attributable To Members Of BHP Billiton Group

	12 months ended	Jun 30, 2011	Jun 30, 2010	Jun 30, 2009	Jun 30, 2008	Jun 30, 2007	Jun 30, 2006
	Profit after taxation attributable to members of BHP Billiton Group (as reported)
	Add: Available for sale investments
	Profit after taxation attributable to members of BHP Billiton Group (adjusted)

Adjusted Ratios: Mark to Market Available-for-sale Securities (Summary)

BHP Billiton Ltd., adjusted ratios

		Jun 30, 2011	Jun 30, 2010	Jun 30, 2009	Jun 30, 2008	Jun 30, 2007	Jun 30, 2006
	Net Profit Margin
	Reported net profit margin	%	%	%	%	%	%
	Adjusted net profit margin	%	%	%	%	%	%
	Return on Equity (ROE)
	Reported ROE	%	%	%	%	%	%
	Adjusted ROE	%	%	%	%	%	%
	Return on Assets (ROA)
	Reported ROA	%	%	%	%	%	%
	Adjusted ROA	%	%	%	%	%	%

Adjusted Net Profit Margin

		Jun 30, 2011	Jun 30, 2010	Jun 30, 2009	Jun 30, 2008	Jun 30, 2007	Jun 30, 2006
	As Reported
	Profit after taxation attributable to members of BHP Billiton Group (USD $ in millions)
	Revenue (USD $ in millions)
	Net profit margin1	%	%	%	%	%	%
	Adjusted: Mark to Market Available-for-sale Securities
	Adjusted profit after taxation attributable to members of BHP Billiton Group (USD $ in millions)
	Revenue (USD $ in millions)
	Adjusted net profit margin2	%	%	%	%	%	%

2011 Calculations

Adjusted Return On Equity (ROE)

		Jun 30, 2011	Jun 30, 2010	Jun 30, 2009	Jun 30, 2008	Jun 30, 2007	Jun 30, 2006
	As Reported
	Profit after taxation attributable to members of BHP Billiton Group (USD $ in millions)
	Equity attributable to members of BHP Billiton Group (USD $ in millions)
	ROE1	%	%	%	%	%	%
	Adjusted: Mark to Market Available-for-sale Securities
	Adjusted profit after taxation attributable to members of BHP Billiton Group (USD $ in millions)
	Equity attributable to members of BHP Billiton Group (USD $ in millions)
	Adjusted ROE2	%	%	%	%	%	%

2011 Calculations

Adjusted Return On Assets (ROA)

		Jun 30, 2011	Jun 30, 2010	Jun 30, 2009	Jun 30, 2008	Jun 30, 2007	Jun 30, 2006
	As Reported
	Profit after taxation attributable to members of BHP Billiton Group (USD $ in millions)
	Total assets (USD $ in millions)
	ROA1	%	%	%	%	%	%
	Adjusted: Mark to Market Available-for-sale Securities
	Adjusted profit after taxation attributable to members of BHP Billiton Group (USD $ in millions)
	Total assets (USD $ in millions)
	Adjusted ROA2	%	%	%	%	%	%

2011 Calculations