Company: BBU
Filing Date: 2025-04-10
Form Type: 20-F
Source: 0001628280-25-017216
Chunk: 34

Company: Brookfield Business Partners L.P.
Filing Date: 2025-04-10
Form: 20-F
Item: Item 3
Chunk 34
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 estimates in relation to our services. Inaccuracies in these estimates may lead to cost overruns that may not be paid by our clients, thereby resulting in reduced profits or in losses. If a contract is significant or there are one or more events that impact a contract or multiple contracts, cost overruns could have a material impact on our reputation or our financial results, negatively impacting the financial condition, results of operations or cash flow of our construction operation. A portion of our ongoing construction projects are in fixed-price contracts, where we bear a significant portion of the risk for cost overruns. Reimbursable contract types, such as those that include negotiated hourly billing rates, may restrict the kinds or amounts of costs that are reimbursable, therefore exposing us to risk that we may incur certain costs in executing these contracts that are above our estimates and not recoverable from our clients. If our construction operation fail to accurately estimate the resources and time necessary for these types of contracts, or fails to complete these contracts within the timeframes and costs we have agreed upon, there could be a material impact on the financial results as well as reputation of our construction operation. Risks under our construction contracts which could result in cost overruns, project delays or other problems can also include:

• difficulties related to the performance of our clients, partners, subcontractors, suppliers or other third parties;

• changes in local laws or difficulties or delays in obtaining permits, rights of way or approvals;

• 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.

These risks tend to be exacerbated for longer-term contracts because there is an increased risk that the circumstances under which we based our original cost estimates or project schedules will change with a resulting increase in costs. In many of these contracts, we may not be able to obtain compensation for additional work performed or expenses incurred, and if a project is not executed on schedule, we may be required to pay liquidated damages. In addition, these losses may be material and can, in some circumstances, equal or exceed the full value of the contract. In such circumstances, the financial condition, results of operations