##### Table of Contents









UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-K


|  |  |                                                                                             
|- |  | --------------------------------------------------------------------------------------------
|þ |  | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934    
| 
|  |  | For the Year Ended December 31, 2004                                                        
| 
|o |  | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934
| 
|  |  | For the transition period
    from:          to                                             

BUSINESS OBJECTS S.A.


(Exact name of Registrant as specified in its charter)


|                                               |  |                          |  |                                        
|---------------------------------------------- |  | ------------------------ |  | ---------------------------------------
|Republic of France                             |  | 0-24720                  |  | 98-0355777                             
|(State or other jurisdiction of incorporation) |  | (Commission File Number) |  | (I.R.S. Employer Identification Number)

157-159 Rue Anatole France, 92300 Levallois-Perret, France


(Address of principal executive offices)


(408) 953-6000


(Registrants telephone number, including area code)


Securities registered pursuant to Section 12(b) of the
Act: None


Securities registered pursuant to Section 12(g) of the
Act:


|                                                                                         |  |                                                                    
|---------------------------------------------------------------------------------------- |  | -------------------------------------------------------------------
|Title of each class:                                                                     |  | Name of each exchange on which registered:                         
|                                                                                         |  |                                                                    
|American depositary shares, each representing one ordinary
    share
    Ordinary shares |  | Nasdaq National Market Eurolist by Euronext,
    Paris S.A., France



| |   |                                                                                                                                                                                                   
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | * | Ordinary shares are not traded in the United States, but rather
    they are deposited with The Bank of New York, as Depositary.
    Each American depositary share represents one ordinary share.

Securities for which there is a reporting obligation pursuant
to Section 15(d) of the Act: None


þ o


o


þ o





 










---



##### Table of Contents



Documents Incorporated by Reference




Trademarks




Reporting Currency




American Depositary Shares






---










BUSINESS OBJECTS S.A.


TABLE OF CONTENTS


|                |  |                                                                                                                      |  |      |     | 
|--------------- |  | -------------------------------------------------------------------------------------------------------------------- |  | ---- | --- | 
|                |  |                                                                                                                      |  | Page |    
|                |  |                                                                                                                      |  |      |    
|PART I         
|Item 1.         |  | Business                                                                                                             |  |      | 3   | 
|Item 2.         |  | Properties                                                                                                           |  |      | 15  | 
|Item 3.         |  | Legal Proceedings                                                                                                    |  |      | 16  | 
|Item 4.         |  | Submission of Matters to a Vote of Security
    Holders                                                              |  |      | 18  | 
|               
|PART II        
|Item 5.         |  | Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities |  |      | 19  | 
|Item 6.         |  | Selected Financial Data                                                                                              |  |      | 23  | 
|Item 7.         |  | Managements Discussion and Analysis
    of Financial Condition and Results of Operations                            |  |      | 25  | 
|Item 7A.        |  | Quantitative and Qualitative Disclosures
    About Market Risk                                                       |  |      | 61  | 
|Item 8.         |  | Financial Statements and Supplementary
    Data                                                                      |  |      | 64  | 
|Item 9.         |  | Changes in and Disagreements with
    Accountants on Accounting and Financial Disclosure                             |  |      | 110 | 
|Item 9A.        |  | Controls and Procedures                                                                                              |  |      | 110 | 
|Item 9B.        |  | Other Information                                                                                                    |  |      | 110 | 
|               
|PART III       
|Item 10.        |  | Directors and Executive Officers of the
    Registrant                                                               |  |      | 111 | 
|Item 11.        |  | Executive Compensation                                                                                               |  |      | 111 | 
|Item 12.        |  | Security Ownership of Certain Beneficial
    Owners and Management and Related Stockholder Matters                   |  |      | 111 | 
|Item 13.        |  | Certain Relationships and Related
    Transactions                                                                   |  |      | 111 | 
|Item 14.        |  | Principal Accountant Fees and Services                                                                               |  |      | 111 | 
|               
|PART IV        
|Item 15.        |  | Exhibits and Financial Statement
    Schedules                                                                       |  |      | 112 | 
|EXHIBIT 10.24  
|EXHIBIT 10.25.1
|EXHIBIT 10.25.2
|EXHIBIT 10.25.3
|EXHIBIT 10.62  
|EXHIBIT 21.1   
|EXHIBIT 23.1   
|EXHIBIT 31.1   
|EXHIBIT 31.2   
|EXHIBIT 32.1   



2



---



##### Table of Contents






PART I


This discussion contains forward-looking statements based on
our expectations, assumptions, estimates and projections about
Business Objects and our industry as of the filing date of this
Form 10-K. These statements include, but are not limited
to, statements concerning: our strategy, including the
companys expected financial performance, continued sales
of our existing products and services as well as sales of the
companys BusinessObjects XI product offering. Actual
events or results may differ materially from those described in
this document due to a number of risks and uncertainties. The
potential risks and uncertainties include, among others, the
companys ability to attract and retain customer support
for BusinessObjects XI; the realization of revenues from new OEM
and reseller agreements; the introduction of new products by
competitors or the entry of new competitors into the markets for
Business Objects products; the impact of the pricing of
competing technologies; and economic and political conditions in
the U.S. and abroad. These forward-looking statements involve
risks and uncertainties. Business Objects actual results
could differ materially from those indicated in these
forward-looking statements as a result of certain factors, as
more fully described in Managements Discussion and
Analysis of Financial Condition and Results of Operations in the
section captioned Factors Affecting Future Operating
Results and elsewhere in this Form 10-K. Business
Objects undertakes no obligation to update publicly any
forward-looking statements for any reason, even if new
information becomes available or other events occur in the
future.







|        |         
|------- | --------
|Item 1. | Business

Our Company






www.businessobjects.com.


Industry Background


Business Strategy




Enterprise standardization.




3



---



##### Table of Contents



Enterprise Performance Management (EPM).


Mid-market organizations.


Developer Business Intelligence.


Products






| |                
| | ---------------
| | BusinessObjects





Reporting




Crystal Reports


Crystal Reports Server


4



---



##### Table of Contents



Query and Analysis




BusinessObjects Web Intelligence


BusinessObjects OLAP Intelligence


BusinessObjects


Performance Management Products and Enterprise Analytic
Applications




BusinessObjects Dashboard Manager


BusinessObjects Performance Manager


BusinessObjects Customer Intelligence


BusinessObjects Finance Intelligence


BusinessObjects Human Resource Intelligence


5



---



##### Table of Contents



BusinessObjects Products & Service Intelligence


BusinessObjects Supply Chain Intelligence


Analytic Engines


Data Integration Products




BusinessObjects Data Integrator


BusinessObjects Rapid Marts


Services


Post-Sales Customer Support and Software Maintenance.






Customer Education and Training.


6



---



##### Table of Contents







Consulting Services.




Sales and Marketing








Strategic Relationships






7



---



##### Table of Contents





Product Development




Customers




Competition






Patents and Intellectual Property Protection






8



---



##### Table of Contents















9



---



##### Table of Contents





Employees






| |   |                                                                                 
| | - | --------------------------------------------------------------------------------
| |  | 987 in customer service and support, including 425 in
    professional services;
|
| |  | 1,449 in sales and marketing;                                                   
|
| |  | 878 in research and development; and                                            
|
| |  | 520 in finance and administration.                                              

Confédération Francaise Démocratique du
Travail Confédération Générale du Travail


comité dentreprise,


Philanthropy




10



---



##### Table of Contents



Directors and Executive Officers




|                    |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------------------- |  | --- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name                |  | Age |  | Principal Occupation and Business Experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                    |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Bernard Liautaud    |  | 42  |  | Chairman of the Board and Chief Executive Officer.Mr.
    Liautaud is a founder of the Company and has served as chairman
    of our board and chief executive officer since our inception in
    August 1990. Prior to the founding of Business Objects,
    Mr. Liautaud was the sales marketing manager with Oracle
    Corporations French subsidiary. Mr. Liautaud is the
    son-in-law of Mr. Silverman, one of our directors.
    Mr. Liautaud does not hold directorships other than in
    subsidiaries of Business Objects, including Business Objects
    Americas, Business Objects Holdings, Inc., Business Objects Data
    Integration Inc., Acta Technology GmbH and Acta Technology Ltd.
    Mr. Liautauds term of office on our board of
    directors will expire at the close of our 2006 annual
    shareholders meeting.                                                                         
|Bernard Charlès     |  | 47  |  | President of Dassault Systémes S.A.Mr. Charlès
    has been chief executive officer of Dassault Systémes S.A.,
    a worldwide leader in product life cycle management, since 2002
    and president of Dassault Systémes since 1995. From 1988 to
    September 1995, he was president of the Dassault Systémes
    Research and Development. Mr. Charlès is also a
    director of Dassault Data Services S.A., Dassault Systémes
    Corp., Dassault Systémes K.K., DELMIA Corp., ENOVIA Corp.,
    Solidworks Corporation, SmarTeam Corporation Ltd. and Dassault
    Systémes Canada, Inc. Mr. Charlès joined our
    board of directors in 1998. Mr. Charlès is also a
    member of our audit committee, chairman of our compensation
    committee and our lead independent director.
    Mr. Charlès term of office on our board of
    directors will expire at the close of our 2007 shareholders
    meeting.
|Jean-François Heitz |  | 55  |  | Consultant and Private Investor.Mr. Heitz was deputy
    chief financial officer at Microsoft Corporation from April 2000
    to June 2003. Mr. Heitz joined Microsoft in 1989 as deputy
    general manager, and served in a number of different roles
    during his tenure, including treasurer. Prior to Microsoft, he
    spent nine years at Matra SA (GroupLagardere), a French
    multinational high-tech conglomerate, in various business and
    finance positions. Mr. Heitz is a member of the board of
    directors of Infowave Software, Inc. and a member of the board
    of directors and audit committee of Creo, Inc. Mr. Heitz
    joined our board of directors in May 2003, and he also serves on
    our audit committee as chairman and financial expert.
    Mr. Heitzs term of office on our board of directors
    will expire at the close of our 2006 annual shareholders meeting.       

11



---



##### Table of Contents



|                   |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|------------------ |  | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name               |  | Age |  | Principal Occupation and Business Experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                   |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|Gerald Held        |  | 57  |  | Consultant.Since 1999 Dr. Held has been a strategic
    consultant primarily to CEOs of technology firms ranging from
    startups to very large organizations. From 2000 to 2001, he was
    the acting CEO of Cantiga Systems. In 1998, Dr. Held was
    CEO-in-residence at the venture capital firm Kleiner
    Perkins Caufield & Byers. Through 1997, Dr. Held
    was senior vice president of Oracles server product
    division. Prior to Oracle, Dr. Held spent 18 years at
    Tandem Computers Incorporated. Dr. Held is the chairman of
    the board of directors of Software Development Technologies,
    Inc. and serves on the board of MetaMatrix, Inc. Dr. Held
    joined our board of directors in October 2002. Dr. Held is
    also the chairman of our compensation committee, a member of our
    corporate governance committee and a member our nominating
    committee. Dr. Helds term of office on our board of
    directors will expire at the close of our 2005 annual
    shareholders meeting.                                                                                                                   
|David Peterschmidt |  | 57  |  | President and Chief Executive Officer of Openwave Systems,
    Inc.Since November 2004, Mr. Peterschmidt has served
    as President and Chief Executive Officer of Openwave Systems,
    Inc., a telecommunications software and services company. From
    October 2003 to November 2004, Mr. Peterschmidt served as the
    chief executive officer and co-chairman of the Board of
    Directors of Securify, Inc. Mr. Peterschmidt served as
    president, chief executive officer and a director of Inktomi,
    Inc., an internet infrastructure company, from July 1996 to
    March 2003, and served as chairman of the Inktomi board from
    December 1997 to March 2003. He currently serves as a member of
    the Boards of Directors of Openwave Systems, Inc., Electronics
    For Imaging, Inc., Active Decisions, Inc., and Netblue.
    Mr. Peterschmidt joined our board of directors in May 2003.
    He is also chairman of our nominating committee and a member of
    our audit committee. Mr. Peterschmidts term of office
    on our board of directors will expire at the close of our 2006
    annual shareholders meeting.
|David J. Roux      |  | 48  |  | Managing Member of Silver Lake Partners.Mr. Roux is a
    managing member of Silver Lake Partners, a private equity firm
    focused on the technology industry which he co-founded in
    January 1999. From February 1998 to November 1998, he served as
    the chief executive officer and president of Liberate
    Technologies, a software platform provider. From September 1994
    until December 1998, Mr. Roux held various management
    positions with Oracle, most recently as executive vice president
    of corporate development. Mr. Roux is also a director of
    Thomson S.A. and VERITAS Software Corporation. He joined our
    board of directors in December 2003. Mr. Rouxs term
    of office on our board of directors will expire at the close of
    our 2006 annual shareholders meeting.                                                                                                                                                                                                                                                                                                                              
|Arnold Silverman   |  | 66  |  | Consultant and Private Investor.Since 1991,
    Mr. Silverman has been a venture capital investor.
    Mr. Silverman was a director of Oracle from 1984 to 1991.
    Mr. Silverman is a director in TimesTen, Inc., Exemplary
    Software and MAE Software, Inc. Mr. Silverman is
    Mr. Liautauds father-in-law. Mr. Silverman
    joined our board of directors in February 1991, and he is also a
    member of our corporate governance committee.
    Mr. Silvermans term of office on our board of
    directors will expire at the close of our 2007 annual
    shareholders meeting.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

12



---



##### Table of Contents



|                 |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|---------------- |  | --- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name             |  | Age |  | Principal Occupation and Business Experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|                 |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|Kurt Lauk        |  | 58  |  | President of Globe CP GmbH.Dr. Lauk is president of
    Globe CP GmbH, and investment & advisory firm he
    co-founded in July 2000. Dr. Lauk was elected president of
    the Economic Council of the Christian Democratic Party of Berlin
    (Germany) in November 2000. From February to July 2000, he was a
    professor of the Stanford University Business School. From 1996
    to 1999, Dr. Lauk served in various capacities at
    Daimler-Benz and the Mercedes-Benz Group, including senior vice
    president  commercial vehicle division and was a
    member of the chairmans integration council of
    Daimler-Chrysler A.G., Daimler Benz A.G. and Mercedes Benz A.G.
    From 1992 to 1996, Dr. Lauk was senior vice president of
    finance, controlling and marketing of VEBA A.G (today Eon AG).
    From 1989 to 1992 he served as Vice Chairman and CFO of Audi AG.
    From 1984 to 1989, Dr. Lauk as CEO of Zinser
    Textilmaschinen GmbH. From 1978 to 1984, Dr. Lauk served in
    various capacities at the Boston Consulting Group, including
    director of the Munich office, and vice president and director
    of BCG, Inc. (Boston, USA). Dr. Lauk is a member of the
    boards of directors of VERITAS, Corus, Gehring GmbH &
    Co KG and ForteMedia. Mr. Lauk joined our board of directors in
    June 2004. Dr. Lauks term of office on our board of
    directors will expire at the close of our 2007 annual
    shareholders meeting.
|Carl Pascarella  |  | 62  |  | President and Chief Executive Officer of VISA USA.Mr. Pascarella has been president and chief executive
    officer of Visa U.S.A. since August 1993. Before assuming his
    current position, he was president of Visa Internationals
    Asia-Pacific Region and director for the Asia-Pacific Regional
    Board for 11 years. Before joining Visa International,
    Pascarella was vice president, International Division, Crocker
    National Bank and also head of the California International
    Banking and Trade Finance organization for Crocker National
    Bank. Mr. Pascarella was also vice president, Metropolitan
    Banking at Bankers Trust Company. Pascarella is a member of the
    Commonwealth Club of California, Stanford Graduate School of
    Business, the Asian Art Museum, the San Francisco Ballet and the
    San Francisco Symphony. Mr. Pascarella joined our board of
    directors in March of 2005. Mr. Pascarellas term of
    office on our board of directors will expire at the close of our
    2008 annual shareholders meeting.                                                                                                                                                                                                                                                                                                                                                                                                         
|                 |  |     |  | Executive Officers                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|James R. Tolonen |  | 55  |  | Chief Financial Officer.Mr. Tolonen joined Business
    Objects as senior group vice president and chief financial
    officer in January 2003. Before joining our Company, he served
    as chief operating officer and chief financial officer of IGN
    Entertainment, Inc. from October 1999 to December 2002.
    Mr. Tolonen was a director of IGN Entertainment and a
    director and member of the compensation committee of Closedloop
    Solutions, Inc. until 2003. From April of 1998 to September of
    1998, Mr. Tolonen was the president and CFO of Cybermedia, Inc.
    He was a Board member of Cybermedia from 1996 to 1998. Prior to
    that, Mr. Tolonen was chief financial officer and a member
    of the Office of the President at Novell, Inc. from 1989 to 1998.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

13



---



##### Table of Contents



|               |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-------------- |  | --- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Name           |  | Age |  | Principal Occupation and Business Experience                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|               |  |     |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|Susan J. Wolfe |  | 54  |  | Senior Vice President, General Counsel andSecretary.Ms.
    Wolfe joined Business Objects in December 2003 as senior vice
    president, general counsel and secretary. Before joining
    Business Objects, she was the vice president, general counsel
    and secretary of Crystal Decisions and its predecessors from
    1996 to December 2003. Ms. Wolfe was an attorney at Conner
    Peripherals, Inc. from 1994 to 1996. Prior to that she was an
    attorney at the firms of Nolan & Armstrong and Wilson
    Sonsini Goodrich & Rosati, Professional Corporation.

Where You Can Find Additional Information


http://www.sec.gov


www.businessobjects.com


Bulletin des Announces Légales
Obligatoires, French
Journal Officiel http://balo.journal-officiel.gouv.fr/ Autorité des
Marches Financiers Document de Référence www.amf-france.org


www.france.businessobjects.com.


14



---



##### Table of Contents








|        |           
|------- | ----------
|Item 2. | Properties







15



---



##### Table of Contents








|        |                  
|------- | -----------------
|Item 3. | Legal Proceedings









16



---



##### Table of Contents













17



---



##### Table of Contents





Bryan Aronoff, et al. v. Bernard
Liautaud, et al. Ken Dahms v. Bernard
Liautaud, et al.









|        |                                                    
|------- | ---------------------------------------------------
|Item 4. | Submission of Matters to a Vote of Security Holders



Exemptions from Certain Nasdaq Corporate Governance Rules


1 3


1 3


18



---



##### Table of Contents






PART II







|        |                                                                                                                     
|------- | --------------------------------------------------------------------------------------------------------------------
|Item 5. | Market for Registrants Common Equity, Related
    Stockholder Matters and Issuer Purchases of Equity
    Securities

U.S. Market Information




French Market Information


Premier Marché Premier Marché


Premier, Second Nouveau Marchés Premier, Second Nouveau
Marchés




| |   |                                                                                                                                
| | - | -------------------------------------------------------------------------------------------------------------------------------
| |  | Compartment A  companies with a market capitalization
    above
    1 billion;                                               
|
| |  | Compartment B  companies with a market capitalization
    between
    150 million
    and up to and including
    1 billion;
|
| |  | Compartment C  companies with a market capitalization
    below
    150 million.                                             



Service à Règlement
Différé   date de liquidation




19



---



##### Table of Contents





High and Low Price Ranges




|               |  |               |       |           |                |   |       |      |  |  |        |  |  |  |        | 
|-------------- |  | ------------- | ----- | --------- | -------------- | - | ----- | ---- |  |  | ------ |  |  |  | ------ | 
|               |  |               |       | Price per |               
|               |  | Price per ADS |       |           | Ordinary Share |  
|               |  |               |       |           |                |  
|               |  | High          |       |           | Low            |   |       | High |  |  | Low    | 
|               |  |               |       |           |                |   |       |      |  |  |        | 
|2004:          |  |               |       |           |                |   |       |      |  |  |        |  |  |  |        | 
|Fourth Quarter |  | $             | 25.78 |           |                | $ | 21.07 |      |  |  | 20.69 |  |  |  | 16.25 | 
|Third Quarter  |  | $             | 23.79 |           |                | $ | 17.43 |      |  |  | 19.00 |  |  |  | 14.19 | 
|Second Quarter |  | $             | 31.00 |           |                | $ | 18.89 |      |  |  | 25.40 |  |  |  | 15.97 | 
|First Quarter  |  | $             | 38.34 |           |                | $ | 27.40 |      |  |  | 30.68 |  |  |  | 22.16 | 
|2003:          |  |               |       |           |                |   |       |      |  |  |        |  |  |  |        | 
|Fourth Quarter |  | $             | 34.74 |           |                | $ | 25.48 |      |  |  | 29.46 |  |  |  | 21.47 | 
|Third Quarter  |  | $             | 29.59 |           |                | $ | 19.63 |      |  |  | 26.89 |  |  |  | 17.67 | 
|Second Quarter |  | $             | 25.00 |           |                | $ | 16.66 |      |  |  | 21.90 |  |  |  | 15.30 | 
|First Quarter  |  | $             | 19.10 |           |                | $ | 15.44 |      |  |  | 17.95 |  |  |  | 14.47 | 




Dividends.


20



---



##### Table of Contents



Equity Compensation Plan Information




|                                                           |       |                            |            |            |                      |                      |       |                         |  |  |           |           | 
|---------------------------------------------------------- | ----- | -------------------------- | ---------- | ---------- | -------------------- | -------------------- | ----- | ----------------------- |  |  | --------- | --------- | 
|                                                           |       |                            |            |            |                      | Number of Securities |      
|                                                           |       | Number of Securities to be |            |            | Weighted-Average     |                      |       | Remaining Available for | 
|                                                           |       | Issued upon Exercise of    |            |            | Exercise Price of    |                      |       | Future Issuance under   | 
|                                                           |       | Outstanding Options,       |            |            | Outstanding Options, |                      |       | Equity Compensation     | 
|Plan Category                                              |       | Warrants and Rights(1)     |            |            | Warrants and Rights  |                      |       | Plans                   | 
|                                                           |       |                            |            |            |                      |                      |       |                         | 
|                                                           |       | (In Euros)                 |           
|Equity compensation plans approved by security holders     |       |                            | 10,840,780 |            |                      |                      | 25.02 |                         |  |  | 3,206,300 | (2)(3)   
|Equity compensation plans not approved by security holders |       |                            | 0          |            |                      |                      | 0.00  |                         |  |  | 0         |          
|                                                           |       |                            |            |            |                      |                      |       |                         | 
|                                                           | Total |                            |            | 10,840,780 |                      |                      |       | 25.02                   |  |  |           | 3,206,300 | 
|                                                           |       |                            |            |            |                      |                      |       |                         | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | During December 2003, we assumed the as-converted outstanding
    stock options of former Crystal Decisions optionees. The
    former Crystal Decisions 1999 Stock Option Plan now exists as
    part of Business Objects, as the BOSA 1999 Plan. Business
    Objects did not assume any authorized but ungranted stock
    options under the Crystal Decisions 1999 Stock Option Plan and
    may not regrant any stock options from forfeited stock options.



| |                                                                                                                                                                                                                                                                                     
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | As a result of the acquisition of Crystal Decisions, an
    aggregate of 6,310,234 ordinary shares were issued to Business
    Objects Option LLC as described in the section High and
    Low Price Ranges. These shares are issued and are not
    included in this calculation.



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Includes 581,998 shares available for issuance under the
    1995 IESPP, 475,000 shares available under the 2004 IESPP
    and 192,584 shares available for issuance under the French
    ESPP. The 1995 IESPP will expire in June 2005 after the closing
    of the March 31, 2005 offering period.                                                                                                                                                                                                                                                                                                                                                                      
|   
|(3) | Includes 1,956,718 shares available for issuance under the
    2001 Plan. No further stock options can be granted under the
    1993 Plan, which expired in 1998, the 1994 Plan, which expired
    in 1999, or under the 1999 Plan, which expired in May 2004. The
    2001 Plan is subject annually to one or more increases within
    the limit of the lowest of the following amounts:
    (i) 6.5 million shares, with
    0.10 nominal
    value per share, (ii) the number of shares corresponding to
    5% of the total number of Business Objects shares outstanding as
    of June 30, or (iii) any lesser amount as determined
    by the Board of Directors.

21



---



##### Table of Contents



Issuer Purchases of Equity Securities




|                                |  |              |   |  |            |                     |                    |  |                    |                   |   |  |  |  |           | 
|------------------------------- |  | ------------ | - |  | ---------- | ------------------- | ------------------ |  | ------------------ | ----------------- | - |  |  |  | --------- | 
|                                |  |              |   |  |            | Total Number        |                    |  | Maximum Number     |                  
|                                |  |              |   |  |            | of Shares Purchased |                    |  | of Shares that May |                  
|                                |  | Total Number |   |  | Average    |                     | as Part of         |  |                    | Yet Be Purchased  |  
|                                |  | of Shares    |   |  | Price Paid |                     | Publicly Announced |  |                    | Under the Program |  
|                                |  | Purchased    |   |  | per Share  |                     | Program            |  |                    | (A)               |  
|                                |  |              |   |  |            |                     |                    |  |                    |                   |  
|Balance at September 30, 2004   |  |              |  |  |            | $                   |                   |  |                    |                   |  |  |  |  | 2,068,561 | 
|October 1 to October 31, 2004   |  |              |  |  |            |                     |                   |  |                    |                   |  |  |  |  | 2,428,358 | 
|November 1 to November 30, 2004 |  |              |  |  |            |                     |                   |  |                    |                   |  |  |  |  | 2,626,120 | 
|December 1 to December 31, 2004 |  |              |  |  |            |                     |                   |  |                    |                   |  |  |  |  | 2,822,981 | 
|                                |  |              |   |  |            |                     |                    |  |                    |                   |   | 
|Total                           |  |              |  |  |            | $                   |                   |  |                    |                   |  |  |  |  | 2,822,981 | 
|                                |  |              |   |  |            |                     |                    |  |                    |                   |   | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(A) | At our ordinary and extraordinary general meeting of
    shareholders held on June 10, 2004, our shareholders
    approved a share repurchase program under which our Board of
    Directors is authorized to purchase a maximum of
    8.4 million of our ordinary shares with
    0.10 nominal
    value per share, at a maximum purchase price of
    35.00 per
    share (excluding costs) or its U.S. dollar equivalent. The
    authorization further specified that the total number of
    treasury shares shall not exceed 10% of our share capital. The
    total number of treasury shares includes the number of shares to
    be purchased under the program, shares already held in treasury
    or shares held by Business Objects Option LLC. As such, the
    number of shares that may be purchased fluctuates with the
    change in the issued number of shares, or a change in the number
    of shares held in treasury or by Business Objects Option LLC.
    The authorization further specified that the total number of
    treasury shares cancelled over a 24-month period shall not
    exceed 10% of our outstanding share capital. This new
    authorization is valid for 18 months and will expire on
    December 10, 2005.
|   
|    | There were no shares repurchased during the three months ended
    December 31, 2004. During the year ended December 31,
    2004, we repurchased 2.0 million shares at an average
    purchase price of
    16.71.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

22



---



##### Table of Contents








|        |                        
|------- | -----------------------
|Item 6. | Selected Financial Data



|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |         |         |  |   |         |         | 
|------------------------------------------------------------------------------------------------------------ | ------------------------ | ------------------------------------------------------ | ------- | ------- | ------- | - | ------- | ------- |  | - | ------- | ------- |  | ---- | ------- | ------- |  | - | ------- | ------- | 
|                                                                                                             |                          | Year Ended December 31,                                |        
|                                                                                                             |                          |                                                        |        
|                                                                                                             |                          | 2004(1)                                                |         |         | 2003(2) |   |         | 2002    |  |   | 2001    |         |  | 2000 |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|                                                                                                             |                          | (In thousands, except per ordinary share and ADS data) |        
|Statement of Income Data:                                                                                    |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |         |         |  |   |         |        
|Revenues:                                                                                                    |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |         |         |  |   |         |        
|Net license fees                                                                                             |                          | $                                                      | 473,373 |         |         | $ | 275,261 |         |  | $ | 243,955 |         |  | $    | 249,594 |         |  | $ | 220,845 |        
|Services                                                                                                     |                          |                                                        | 452,258 |         |         |   | 285,564 |         |  |   | 210,844 |         |  |      | 166,200 |         |  |   | 128,089 |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|                                                                                                             | Total revenues           |                                                        |         | 925,631 |         |   |         | 560,825 |  |   |         | 454,799 |  |      |         | 415,794 |  |   |         | 348,934 | 
|Cost of revenues:                                                                                            |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |         |         |  |   |         |        
|Net license fees                                                                                             |                          |                                                        | 28,272  |         |         |   | 5,951   |         |  |   | 3,102   |         |  |      | 2,155   |         |  |   | 2,569   |        
|Services                                                                                                     |                          |                                                        | 172,133 |         |         |   | 89,005  |         |  |   | 71,489  |         |  |      | 63,497  |         |  |   | 53,101  |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|                                                                                                             | Total cost of revenues   |                                                        |         | 200,405 |         |   |         | 94,956  |  |   |         | 74,591  |  |      |         | 65,652  |  |   |         | 55,670  | 
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Gross profit                                                                                                 |                          |                                                        | 725,226 |         |         |   | 465,869 |         |  |   | 380,208 |         |  |      | 350,142 |         |  |   | 293,264 |        
|Operating expenses:                                                                                          |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |         |         |  |   |         |        
|Sales and marketing                                                                                          |                          |                                                        | 406,796 |         |         |   | 250,870 |         |  |   | 222,243 |         |  |      | 203,655 |         |  |   | 167,519 |        
|Research and development                                                                                     |                          |                                                        | 150,562 |         |         |   | 95,399  |         |  |   | 74,991  |         |  |      | 55,246  |         |  |   | 40,725  |        
|General and administrative                                                                                   |                          |                                                        | 83,947  |         |         |   | 44,655  |         |  |   | 29,387  |         |  |      | 24,256  |         |  |   | 21,741  |        
|Acquired in-process technology                                                                               |                          |                                                        |        |         |         |   | 27,966  |         |  |   | 2,000   |         |  |      |        |         |  |   |        |        
|Restructuring costs                                                                                          |                          |                                                        | 2,169   |         |         |   | 7,782   |         |  |   | 3,871   |         |  |      |        |         |  |   |        |        
|Amortization of goodwill(3)                                                                                  |                          |                                                        |        |         |         |   |        |         |  |   |        |         |  |      | 4,492   |         |  |   | 4,254   |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|                                                                                                             | Total operating expenses |                                                        |         | 643,474 |         |   |         | 426,672 |  |   |         | 332,492 |  |      |         | 287,649 |  |   |         | 234,239 | 
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Income from operations                                                                                       |                          |                                                        | 81,752  |         |         |   | 39,197  |         |  |   | 47,716  |         |  |      | 62,493  |         |  |   | 59,025  |        
|Interest and other income (expense), net                                                                     |                          |                                                        | (4,220  | )       |         |   | 14,334  |         |  |   | 18,959  |         |  |      | 10,460  |         |  |   | 11,647  |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Income before provision for income taxes                                                                     |                          |                                                        | 77,532  |         |         |   | 53,531  |         |  |   | 66,675  |         |  |      | 72,953  |         |  |   | 70,672  |        
|Provision for income taxes                                                                                   |                          |                                                        | (30,409 | )       |         |   | (30,969 | )       |  |   | (26,095 | )       |  |      | (28,075 | )       |  |   | (28,269 | )      
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Net income                                                                                                   |                          | $                                                      | 47,123  |         |         | $ | 22,562  |         |  | $ | 40,580  |         |  | $    | 44,878  |         |  | $ | 42,403  |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Basic net income per ordinary share and ADS                                                                  |                          | $                                                      | 0.53    |         |         | $ | 0.35    |         |  | $ | 0.66    |         |  | $    | 0.74    |         |  | $ | 0.71    |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Diluted net income per ordinary share and ADS                                                                |                          | $                                                      | 0.52    |         |         | $ | 0.34    |         |  | $ | 0.63    |         |  | $    | 0.70    |         |  | $ | 0.65    |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Ordinary shares and ADSs used in computing basic net income per
    ordinary share and ADS                   |                          |                                                        | 88,748  |         |         |   | 64,584  |         |  |   | 61,888  |         |  |      | 60,879  |         |  |   | 59,741  |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        
|Ordinary shares and ADSs and equivalents used in computing
    diluted net income per ordinary share and ADS |                          |                                                        | 91,077  |         |         |   | 66,168  |         |  |   | 63,933  |         |  |      | 64,361  |         |  |   | 65,292  |        
|                                                                                                             |                          |                                                        |         |         |         |   |         |         |  |   |         |         |  |      |        

23



---



##### Table of Contents



|                                                                       |  |                 |           |  |         |   |           |      |  |   |         |  |  |      |         |  |  |   |         | 
|---------------------------------------------------------------------- |  | --------------- | --------- |  | ------- | - | --------- | ---- |  | - | ------- |  |  | ---- | ------- |  |  | - | ------- | 
|                                                                       |  | At December 31, |          
|                                                                       |  |                 |          
|                                                                       |  | 2004            |           |  | 2003(2) |   |           | 2002 |  |   | 2001    |  |  | 2000 |        
|                                                                       |  |                 |           |  |         |   |           |      |  |   |         |  |  |      |        
|                                                                       |  | (In thousands)  |          
|Balance Sheet Data:                                                    |  |                 |           |  |         |   |           |      |  |   |         |  |  |      |         |  |  |   |         | 
|Cash, cash equivalents, short-term investments and restricted
    cash |  | $               | 311,359   |  |         | $ | 257,955   |      |  | $ | 301,509 |  |  | $    | 251,509 |  |  | $ | 213,267 | 
|Total assets                                                           |  |                 | 1,922,928 |  |         |   | 1,775,062 |      |  |   | 551,808 |  |  |      | 421,469 |  |  |   | 369,014 | 
|Working capital                                                        |  |                 | 113,482   |  |         |   | 49,513    |      |  |   | 225,513 |  |  |      | 193,150 |  |  |   | 164,439 | 
|Long-term liabilities                                                  |  |                 | 14,047    |  |         |   | 4,950     |      |  |   | 17,441  |  |  |      | 3,174   |  |  |   | 4,288   | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | 2004 represented the first full year of operations for the
    combined company including Crystal Decisions, which resulted in
    significant increases in revenues and expenses. These figures
    included $30.8 million in amortization of intangible assets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|   
|(2) | We acquired Crystal Decisions on December 11, 2003 for a
    total purchase price of $1.2 billion. The purchase price
    consisted of the payment of $307.6 million in cash to
    former shareholders of Crystal Decisions, which was paid out of
    general cash reserves, and the issue of 23.3 million ADSs.
    We acquired the fair value of the net tangible and intangible
    assets on purchase, including $978.0 million of goodwill
    and $142.7 million of amortizable intangible assets. The
    statement of income for 2003 includes the revenues and expenses
    of Crystal Decisions for the 20 days ended
    December 31, 2003. Our acquisition of Crystal Decisions had
    a $38.0 million negative impact on operating income for
    2003 due to the $28.0 million write-off of acquired
    in-process technology, $2.2 million in amortization of
    acquired intangible assets and deferred stock-based compensation
    expense, $7.5 million in integration related costs and
    $7.8 million in restructuring costs. These costs were
    partially offset by the $7.4 million of operating income
    earned by Crystal Decisions during the 20 days in 2003 that
    we operated as a combined company.
|   
|(3) | We no longer amortize goodwill effective January 1, 2002
    with our adoption of Statement of Financial Accounting Standard
    (FAS) No. 142, Goodwill and Other
    Intangible Assets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

24



---



##### Table of Contents








|        |                                                                                          
|------- | -----------------------------------------------------------------------------------------
|Item 7. | Managements Discussion and Analysis of Financial
    Condition and Results of Operations

The following discussion and analysis should be read together
with our Consolidated Financial Statements and the Notes to
those statements included elsewhere in this Form 10-K. This
discussion contains forward- looking statements based on our
current expectations, assumptions, estimates and projections
about Business Objects and our industry. These forward-looking
statements involve risks and uncertainties. Business
Objects actual results could differ materially from those
indicated in these forward looking statements as a result of
certain factors, as more fully described in the Factors
Affecting Future Operating Results section of this
Managements Discussion and Analysis of Financial Condition
and Results of Operations and elsewhere in this Form 10-K.
Business Objects undertakes no obligation to update publicly any
forward-looking statements for any reason, even if new
information becomes available or other events occur in the
future.


OVERVIEW




| |             
| | ------------
| | Our Business





Sources of Revenues and Expenses




| |                 
| | ----------------
| | Net License Fees





| |                  
| | -----------------
| | Services Revenues







| |                  
| | -----------------
| | Costs of Revenues



25



---



##### Table of Contents





| |                   
| | ------------------
| | Operating Expenses



Share-based Payments Recent Accounting
Pronouncements


Key Performance Indicators


|                                                       |  |                                     |       |   |      |   |       |      |  |   |       |  
|------------------------------------------------------ |  | ----------------------------------- | ----- | - | ---- | - | ----- | ---- |  | - | ----- | -
|                                                       |  | 2004                                |       |   | 2003 |   |       | 2002 | 
|                                                       |  |                                     |       |   |      |   |       |      | 
|                                                       |  | (In millions, except for % and EPS) |      
|Revenues                                               |  | $                                   | 925.6 |   |      | $ | 560.8 |      |  | $ | 454.8 |  
|Revenues growth                                        |  |                                     | 65    | % |      |   | 23    | %    |  |   | 9     | %
|Operating income                                       |  | $                                   | 81.8  |   |      | $ | 39.2  |      |  | $ | 47.7  |  
|Income from operations as percentage of total revenues |  |                                     | 9     | % |      |   | 7     | %    |  |   | 11    | %
|Diluted EPS                                            |  | $                                   | 0.52  |   |      | $ | 0.34  |      |  | $ | 0.63  |  
|                                                       |  |                                     |       |   |      |   |       |      | 





26



---



##### Table of Contents





|                                            |       |               |      |      |           |   |      |      |  |   |      |      |  |      |      |      |      |   |      |      |  |   |      |      | 
|------------------------------------------- | ----- | ------------- | ---- | ---- | --------- | - | ---- | ---- |  | - | ---- | ---- |  | ---- | ---- | ---- | ---- | - | ---- | ---- |  | - | ---- | ---- | 
|                                            |       | Actual        |      |      | Estimated |  
|                                            |       |               |      |      |           |  
|                                            |       | 2003          |      |      | 2004      |   |      | 2005 |  |   | 2006 |      |  | 2007 |      |      | 2008 |  
|                                            |       |               |      |      |           |   |      |      |  |   |      |      |  |      |      |      |      |  
|                                            |       | (In millions) |     
|Write-off of acquired in-process technology |       | $             | 28.0 |      |           | $ | 0.0  |      |  | $ | 0.0  |      |  | $    | 0.0  |      |      | $ | 0.0  |      |  | $ | 0.0  |     
|Amortization of developed technology        |       |               | 1.0  |      |           |   | 18.4 |      |  |   | 20.0 |      |  |      | 20.0 |      |      |   | 20.0 |      |  |   | 18.9 |     
|Amortization of other intangible assets     |       |               | 0.6  |      |           |   | 8.7  |      |  |   | 10.1 |      |  |      | 10.1 |      |      |   | 10.1 |      |  |   | 9.6  |     
|Amortization of deferred compensation(1)    |       |               | 0.6  |      |           |   | 6.7  |      |  |   | 4.6  |      |  |      | 2.8  |      |      |   | 0.6  |      |  |   | 0.0  |     
|Restructuring expenses                      |       |               | 7.8  |      |           |   | 2.2  |      |  |   | 0.0  |      |  |      | 0.0  |      |      |   | 0.0  |      |  |   | 0.0  |     
|                                            |       |               |      |      |           |   |      |      |  |   |      |      |  |      |      |      |      |  
|                                            | Total |               | $    | 38.0 |           |   | $    | 36.0 |  |   | $    | 34.7 |  |      | $    | 32.9 |      |   | $    | 30.7 |  |   | $    | 28.5 | 
|                                            |       |               |      |      |           |   |      |      |  |   |      |      |  |      |      |      |      |  






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | We reversed $3.6 million and $0.8 million in 2004 and
    December 2003, respectively, of unearned compensation which is
    recorded in the Statement of Shareholders Equity. The
    reversal was the result of the forfeiture of unvested stock
    options, which will reduce anticipated future amortization of
    deferred compensation. On the adoption of FAS 123R
    amortization of this unearned compensation balance will cease.



| |             
| | ------------
| | New Products











27



---



##### Table of Contents





| |            
| | -----------
| | Seasonality





| |                                                                                   
| | ----------------------------------------------------------------------------------
| | Impact of Foreign Currency Exchange Rate Fluctuations on
    Results of Operations







|                                                        |                                     |                         |      |      |      |   |      |      |  |   |      |     | 
|------------------------------------------------------- | ----------------------------------- | ----------------------- | ---- | ---- | ---- | - | ---- | ---- |  | - | ---- | --- | 
|                                                        |                                     | Year Ended December 31, |     
|                                                        |                                     |                         |     
|                                                        |                                     | 2004                    |      |      | 2003 |   |      | 2002 | 
|                                                        |                                     |                         |      |      |      |   |      |      | 
|Total revenues                                          |                                     | $                       | 49.1 |      |      | $ | 43.3 |      |  | $ | 8.6  |    
|Total cost of revenues                                  |                                     |                         | 10.5 |      |      |   | 6.6  |      |  |   | 1.4  |    
|                                                        | Sales and marketing expenses        |                         |      | 22.3 |      |   |      | 17.6 |  |   |      | 4.4 | 
|                                                        | Research and development expenses   |                         |      | 11.8 |      |   |      | 12.1 |  |   |      | 3.5 | 
|                                                        | General and administrative expenses |                         |      | 3.9  |      |   |      | 3.2  |  |   |      | 0.5 | 
|Total operating expenses, excluding restructuring costs |                                     |                         | 38.0 |      |      |   | 34.1 |      |  |   | 8.2  |    
|Income from operations, excluding restructuring costs   |                                     |                         | 0.6  |      |      |   | 2.6  |      |  |   | (1.0 | )  



28



---



##### Table of Contents



RESULTS OF OPERATIONS


Revenues




|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |    |     |    |   |       |       |       | 
|------------------ | ------------------------------------ | ----------------------- | ----- | ----- | -------- |  | -- | ---- | -- | - | -------- | ----- | ----- | ---- | -- | --- | -- | - | ----- | ----- | ----- | 
|                   |                                      | 2004                    |       |       | % Change |  |    | 2003 |    |   | % Change |       |       | 2002 |   
|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |   
|Net license fees:  |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |    |     |    |   |       |      
|                   | Business intelligence platform       |                         | $     | 427.2 |          |  |    | 81   |    |   | $        | 235.5 |       |      |    | 7   |    |   | $     | 219.2 |      
|                   | Enterprise analytic applications     |                         |       | 28.0  |          |  |    | 9    |    |   |          | 25.7  |       |      |    | 23  |    |   |       | 20.9  |      
|                   | Data integration                     |                         |       | 18.2  |          |  |    | 30   |    |   |          | 14.0  |       |      |    | 259 |    |   |       | 3.9   |      
|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |   
|                   |                                      | Total net license fees  |       | $     | 473.4    |  |    |      | 72 |   |          | $     | 275.2 |      |    |     | 13 |   |       | $     | 244.0 | 
|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |   
|Services revenues: |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |    |     |    |   |       |      
|                   | Software license updates and support |                         |       | 330.7 |          |  |    | 57   |    |   |          | 210.8 |       |      |    | 40  |    |   |       | 150.4 |      
|                   | Professional services and other      |                         |       | 121.5 |          |  |    | 62   |    |   |          | 74.8  |       |      |    | 24  |    |   |       | 60.4  |      
|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |   
|                   |                                      | Total services revenues |       |       | 452.2    |  |    |      | 58 |   |          |       | 285.6 |      |    |     | 35 |   |       |       | 210.8 | 
|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |   
|Total revenues     |                                      | $                       | 925.6 |       |          |  | 65 |      |    | $ | 560.8    |       |       |      | 23 |     |    | $ | 454.8 |      
|                   |                                      |                         |       |       |          |  |    |      |    |   |          |       |       |      |   



| |                 
| | ----------------
| | Net License Fees













| |                  
| | -----------------
| | Services Revenues



29



---



##### Table of Contents









Geographic Revenues
Mix




|                                             |                           |                |       |    |          |  |    |      |  |   |          |    |       |      |    |  |  |   |       |    |       | 
|-------------------------------------------- | ------------------------- | -------------- | ----- | -- | -------- |  | -- | ---- |  | - | -------- | -- | ----- | ---- | -- |  |  | - | ----- | -- | ----- | 
|                                             |                           | 2004           |       |    | % Change |  |    | 2003 |  |   | % Change |    |       | 2002 |   
|                                             |                           |                |       |    |          |  |    |      |  |   |          |    |       |      |   
|Europe, Middle East and Africa (EMEA)(1)     |                           | $              | 397.7 |    |          |  | 45 |      |  | $ | 273.7    |    |       |      | 29 |  |  | $ | 212.4 |   
|                                             | Percent of total revenues |                |       | 43 | %        |  |    |      |  |   |          | 49 | %     |      |    |  |  |   |       | 47 | %    
|Americas, including Canada and Latin America |                           |                | 453.3 |    |          |  | 87 |      |  |   | 241.9    |    |       |      | 13 |  |  |   | 212.9 |   
|                                             | Percent of total revenues |                |       | 49 | %        |  |    |      |  |   |          | 43 | %     |      |    |  |  |   |       | 47 | %    
|Asia Pacific, including Japan                |                           |                | 74.6  |    |          |  | 65 |      |  |   | 45.2     |    |       |      | 53 |  |  |   | 29.5  |   
|                                             | Percent of total revenues |                |       | 8  | %        |  |    |      |  |   |          | 8  | %     |      |    |  |  |   |       | 6  | %    
|                                             |                           |                |       |    |          |  |    |      |  |   |          |    |       |      |   
|                                             |                           | Total revenues |       | $  | 925.6    |  |    |      |  |   |          | $  | 560.8 |      |    |  |  |   |       | $  | 454.8 | 
|                                             |                           |                |       |    |          |  |    |      |  |   |          |    |       |      |   



|    |                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------
|(1) | Includes for France total revenues of $85.9 million in
    2004, $72.1 million in 2003 and $53.8 million
    in 2002.





30



---



##### Table of Contents



   




Cost of Revenues


|                  |                        |                                      |       |       |          |  |     |      |  |   |          |      |  |      |    |    |  |   |      |      | 
|----------------- | ---------------------- | ------------------------------------ | ----- | ----- | -------- |  | --- | ---- |  | - | -------- | ---- |  | ---- | -- | -- |  | - | ---- | ---- | 
|                  |                        | 2004                                 |       |       | % Change |  |     | 2003 |  |   | % Change |      |  | 2002 |   
|                  |                        |                                      |       |       |          |  |     |      |  |   |          |      |  |      |   
|                  |                        | (In millions, except percent change) |      
|Net license fees  |                        | $                                    | 28.3  |       |          |  | 375 |      |  | $ | 6.0      |      |  |      | 92 |    |  | $ | 3.1  |     
|Services revenues |                        |                                      | 172.1 |       |          |  | 93  |      |  |   | 89.0     |      |  |      | 25 |    |  |   | 71.5 |     
|                  |                        |                                      |       |       |          |  |     |      |  |   |          |      |  |      |   
|                  | Total cost of revenues |                                      | $     | 200.4 |          |  |     | 111  |  |   | $        | 95.0 |  |      |    | 27 |  |   | $    | 74.6 | 
|                  |                        |                                      |       |       |          |  |     |      |  |   |          |      |  |      |   



Cost of net license fees.




Cost of services revenues.




31



---



##### Table of Contents









Operating Income Margin




| |        
| | -------
| | Summary







|                    |                                |                          |  |    |      |   |  |      |    |   |  |    |    |  
|------------------- | ------------------------------ | ------------------------ |  | -- | ---- | - |  | ---- | -- | - |  | -- | -- | -
|                    |                                | For the Year Ended       | 
|                    |                                | December 31,             | 
|                    |                                |                          | 
|                    |                                | 2004                     |  |    | 2003 |   |  | 2002 |   
|                    |                                |                          |  |    |      |   |  |      |   
|Operating expenses: |                                |                          |  |    |      |   |  |      |    |   |  |   
|                    | Sales and marketing            |                          |  | 44 | %    |   |  | 45   | %  |   |  | 49 | % 
|                    | Research and development       |                          |  | 16 | %    |   |  | 17   | %  |   |  | 17 | % 
|                    | General and administrative     |                          |  | 9  | %    |   |  | 8    | %  |   |  | 6  | % 
|                    | Acquired in-process technology |                          |  | 0  | %    |   |  | 5    | %  |   |  | 0  | % 
|                    | Restructuring costs            |                          |  | 0  | %    |   |  | 1    | %  |   |  | 1  | % 
|                    |                                |                          |  |    |      |   |  |      |   
|                    |                                | Total operating expenses |  |    | 69   | % |  |      | 76 | % |  |    | 73 | %
|                    |                                |                          |  |    |      |   |  |      |   



| |                             
| | ----------------------------
| | Sales and Marketing Expenses



32



---



##### Table of Contents









| |                                  
| | ---------------------------------
| | Research and Development Expenses





| |                                    
| | -----------------------------------
| | General and Administrative Expenses









| |                               
| | ------------------------------
| | Acquired In-process Technology



Applicability of FASB Statement
No. 2 to Business Combinations Accounted for by the
Purchase Method


33



---



##### Table of Contents









| |                       
| | ----------------------
| | Restructuring Expenses

Cost Associated with Exit or Disposal
Activities Recognition of Liabilities in Connection with Purchase
Business Combinations




Crystal Decisions.


Restructuring Costs Expensed to Pre-acquisition Business
Objects.




Restructuring Costs Included as a Cost of the Crystal
Decisions Acquisition.




34



---



##### Table of Contents





Acta Technology.




| |                                         
| | ----------------------------------------
| | Interest and Other Income (Expense), Net



|                                                                       |                                          |                         |       |      |      |   |      |      |  |   |      |      | 
|---------------------------------------------------------------------- | ---------------------------------------- | ----------------------- | ----- | ---- | ---- | - | ---- | ---- |  | - | ---- | ---- | 
|                                                                       |                                          | Year Ended December 31, |      
|                                                                       |                                          |                         |      
|                                                                       |                                          | 2004                    |       |      | 2003 |   |      | 2002 | 
|                                                                       |                                          |                         |       |      |      |   |      |      | 
|                                                                       |                                          | (In millions)           |      
|Net interest income                                                    |                                          | $                       | 3.7   |      |      | $ | 7.1  |      |  | $ | 7.7  |     
|Patent infringement settlement income, net of litigation
    expenses: |                                          |                         |       |      |      |   |      |      |  |   |      |     
|                                                                       | Cognos                                   |                         |       | 3.5  |      |   |      | 7.0  |  |   |      | 10.4 | 
|                                                                       | Brio Software                            |                         |       |     |      |   |      |     |  |   |      | 1.5  | 
|Net foreign exchange losses                                            |                                          |                         | (11.6 | )    |      |   | (0.4 | )    |  |   | (0.7 | )   
|Other income (loss), net                                               |                                          |                         | 0.2   |      |      |   | 0.6  |      |  |   | 0.1  |     
|                                                                       |                                          |                         |       |      |      |   |      |      | 
|                                                                       | Interest and other income (expense), net |                         | $     | (4.2 | )    |   | $    | 14.3 |  |   | $    | 19.0 | 
|                                                                       |                                          |                         |       |      |      |   |      |      | 

Interest and other income (expense), net


Patent infringement settlement income.


35



---



##### Table of Contents





Net foreign exchange losses.




| |             
| | ------------
| | Income Taxes











36



---



##### Table of Contents



LIQUIDITY AND CAPITAL RESOURCES


Liquidity




|                                                                       |  |                                 |       |   |      |   |        |      |  |   |        |  
|---------------------------------------------------------------------- |  | ------------------------------- | ----- | - | ---- | - | ------ | ---- |  | - | ------ | -
|                                                                       |  | For the Year Ended December 31, |      
|                                                                       |  |                                 |      
|                                                                       |  | 2004                            |       |   | 2003 |   |        | 2002 | 
|                                                                       |  |                                 |       |   |      |   |        |      | 
|                                                                       |  | (In millions)                   |      
|Cash flow provided by operations                                       |  | $                               | 88.1  |   |      | $ | 98.5   |      |  | $ | 67.2   |  
|Cash flow used in investing activities                                 |  |                                 | (30.6 | ) |      |   | (134.4 | )    |  |   | (118.1 | )
|Cash flow provided by financing activities                             |  |                                 | 2.5   |   |      |   | 29.1   |      |  |   | 9.4    |  
|Effects of changes in exchange rates on cash and cash equivalents      |  |                                 | (1.9  | ) |      |   | 8.2    |      |  |   | 35.0   |  
|                                                                       |  |                                 |       |   |      |   |        |      | 
|Net (increase) decrease in cash and cash equivalents                   |  | $                               | 58.1  |   |      | $ | 1.4    |      |  | $ | (6.5   | )
|                                                                       |  |                                 |       |   |      |   |        |      | 
|Cash, cash equivalents, restricted cash and short-term
    investments |  | $                               | 311.4 |   |      | $ | 258.0  |      |  | $ | 301.5  |  
|                                                                       |  |                                 |       |   |      |   |        |      | 



Operating Activities.






Investing Activities.


Financing Activities. 


37



---



##### Table of Contents










Dividends




Future Liquidity
Requirements


  




38



---



##### Table of Contents



Contractual
Obligations




|                                     |                                    |                        |       |        |        |   |      |           |           |   |           |      |  |         |      |      |  |   |      |      | 
|------------------------------------ | ---------------------------------- | ---------------------- | ----- | ------ | ------ | - | ---- | --------- | --------- | - | --------- | ---- |  | ------- | ---- | ---- |  | - | ---- | ---- | 
|                                     |                                    | Payments Due by Period |      
|                                     |                                    |                        |      
|                                     |                                    |                        |       | Within |        |   |      |           | More Than |  
|                                     |                                    | Total                  |       |        | 1 Year |   |      | 2-3 Years |           |   | 4-5 Years |      |  | 5 Years |     
|                                     |                                    |                        |       |        |        |   |      |           |           |   |           |      |  |         |     
|                                     |                                    | (In millions)          |      
|Operating leases                     |                                    | $                      | 245.3 |        |        | $ | 38.0 |           |           | $ | 66.8      |      |  | $       | 56.9 |      |  | $ | 83.6 |     
|Statutory French Profit Sharing Plan |                                    |                        | 6.3   |        |        |   | 6.3  |           |           |   | 0.0       |      |  |         | 0.0  |      |  |   | 0.0  |     
|                                     |                                    |                        |       |        |        |   |      |           |           |   |           |      |  |         |     
|                                     | Total contractual cash obligations |                        | $     | 251.6  |        |   |      | 44.3      |           |   | $         | 66.8 |  |         | $    | 56.9 |  |   | $    | 83.6 | 
|                                     |                                    |                        |       |        |        |   |      |           |           |   |           |      |  |         |     



| |           
| | ----------
| | Guarantees

Guarantors Accounting for Guarantees.




Product Warranties.


Environmental Liabilities. Accounting for
Asset Retirement Obligations


Other Liabilities and Other Claims.


39



---



##### Table of Contents





OFF-BALANCE SHEET ARRANGEMENTS


Employers
Accounting for Pensions Consolidation of Variable Interest
Entities, an Interpretation of Accounting Research
Bulletin No. 51


CRITICAL ACCOUNTING POLICIES






| |   |                                                                
| | - | ---------------------------------------------------------------
| |  | Recognition of revenues                                        
|
| |  | Business combinations                                          
|
| |  | Restructuring accruals                                         
|
| |  | Impairment of goodwill, intangible assets and long-lived assets
|
| |  | Derivative instruments                                         
|
| |  | Contingencies and litigation                                   
|
| |  | Allowances for doubtful accounts                               
|
| |  | Deferred income tax assets                                     
|
| |  | Stock-based compensation                                       





| |                        
| | -----------------------
| | Recognition of Revenues





| |                      
| | ---------------------
| | Business Combinations



40



---



##### Table of Contents







| |                       
| | ----------------------
| | Restructuring Accruals





| |                                                                          
| | -------------------------------------------------------------------------
| | Impairment of Goodwill, Intangible Assets and Other
    Long-Lived Assets





| |                       
| | ----------------------
| | Derivative Instruments





| |                             
| | ----------------------------
| | Contingencies and Litigation





| |                                 
| | --------------------------------
| | Allowances for Doubtful Accounts



41



---



##### Table of Contents





| |                           
| | --------------------------
| | Deferred Income Tax Assets











| |                         
| | ------------------------
| | Stock-based Compensation

Accounting for Stock Issued to
Employees Accounting for Stock-Based
Compensation


42



---



##### Table of Contents



Recent Accounting Pronouncements


Share-Based Payments. Share-Based Payment, an
Amendment of FASB Statements No. 123 and 95 Share-Based Payment


Share-Based Payment


Factors Affecting Future Operating Results


We operate in a rapidly changing environment that involves
numerous uncertainties and risks. The following section
describes some, but not all, of these risks and uncertainties
that may adversely affect our business, financial conditions or
results of operations. This section should be read in
conjunction with the audited consolidated financial statements
and the accompanying notes thereto, and the other parts of
Managements Discussion and Analysis of Financial Condition
and Results of Operations included in this Form 10-K.
Additional factors and uncertainties not currently known to us
or that we currently consider immaterial could also harm our
business, operating results and financial condition. We may make
forward-looking statements from time to time, both written and
oral. We undertake no obligation to revise or publicly release
the results of any revisions to these forward looking statements
based on circumstances or events which occur in the future.
Actual results may materially differ from those projected in any
such forward looking statements due to a number of factors,
including those set forth below and elsewhere in this
Form 10-K.


43



---



##### Table of Contents



Risks Related to Our Business




| |                                                                                               
| | ----------------------------------------------------------------------------------------------
| | Our quarterly operating results have been and will
    continue to be subject to fluctuations.





| |   |                                                                                                                                                                                                                      
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | we typically receive a substantial amount of our revenues in the
    last weeks of the last month of a quarter, rather than evenly
    throughout the quarter;                                                       
|
| |  | our customers typically wait until their fourth quarter, the end
    of their annual budget cycle, before deciding whether to
    purchase new software;                                                             
|
| |  | economic activity in Europe generally slows during the summer
    months;                                                                                                                                            
|
| |  | customers may delay purchasing decisions in anticipation of our
    product line, other new products, product enhancements or
    platforms or in response to announced pricing changes by us or
    our competitors;
|
| |  | we expect our revenues to vary based on the mix of products and
    services and the amount of consulting services that our
    customers order;                                                                     
|
| |  | we depend, in part, on large orders and any delay in closing a
    large order may result in the realization of potentially
    significant net license fees being postponed from one quarter to
    the next; and   
|
| |  | we expect our revenues to be sensitive to the timing of offers
    of new products that successfully compete with our products on
    the basis of functionality, price or otherwise.                                





| |                                                               
| | --------------------------------------------------------------
| | We may be unable to sustain or increase our
    profitability.





| |                                                                                                                                                                                                                                                                                                 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our revenues may be unpredictable due to the recent
    release of our BusinessObjects XI product, which integrates our
    existing Business Objects and Crystal Decisions product lines,
    and the expected end of life of our existing Business Objects
    and Crystal Decisions products.



44



---



##### Table of Contents









| |                                                                                                                                                                                             
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Charges to earnings resulting from our acquisition of
    Crystal Decisions and additional restructuring and operating
    expenses may adversely affect the market value of our
    shares.







| |                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------
| | If we overestimate revenues, we may be unable to reduce
    our expenses to avoid or minimize a negative impact on our
    quarterly results of operations.





45



---



##### Table of Contents





| |                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Changes to current accounting policies could have a
    significant effect on our reported financial results or the way
    in which we conduct our business.





| |   |                                                     
| | - | ----------------------------------------------------
| |  | software revenue recognition;                       
|
| |  | accounting for stock-based compensation;            
|
| |  | accounting for variable interest entities; and      
|
| |  | accounting for goodwill and other intangible assets.





| |                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------
| | Our market is highly competitive which could harm our
    ability to sell products and services and reduce our market
    share.







| |                                                                                                                                                                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Some of our competitors may have greater financial,
    technical, sales, marketing and other resources than we do. In
    addition, acquisitions of or other strategic transactions by our
    competitors could weaken our competitive position or reduce our
    revenues.



46



---



##### Table of Contents









| |                                                                                                                                         
| | ----------------------------------------------------------------------------------------------------------------------------------------
| | We may pursue strategic acquisitions and investments that
    could have an adverse effect on our business if they are
    unsuccessful.





| |                                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------
| | We have strategic relationships with Microsoft and SAP
    which, if terminated, could reduce our revenues and harm our
    operating results.





| |                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We sell products only in the business intelligence
    software market; if sales of our products in this market
    decline, our operating results will be harmed.





| |                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------
| | If the market in which we sell business intelligence
    software does not grow as anticipated, our future profitability
    could be negatively affected.





| |   |                                                   
| | - | --------------------------------------------------
| |  | not fully value the benefits of using BI products;
|
| |  | not achieve favorable results using BI products;  

47



---



##### Table of Contents





| |   |                                                                            
| | - | ---------------------------------------------------------------------------
| |  | experience technical difficulty in implementing BI
    products; or        
|
| |  | use alternative methods to solve the problems addressed by BI
    software.





| |                                                                                                              
| | -------------------------------------------------------------------------------------------------------------
| | Our software may have defects and errors that may lead to
    a loss of revenues or product liability claims.





| |   |                                                                                                                                                                 
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | potential customers may delay purchases;                                                                                                                        
|
| |  | customers may react negatively, which could reduce further sales;                                                                                               
|
| |  | our reputation in the marketplace may be damaged;                                                                                                               
|
| |  | we may have to defend product liability claims;                                                                                                                 
|
| |  | we may be required to indemnify our customers, distributors,
    original equipment manufacturers or other resellers;                                           
|
| |  | we may incur additional service and warranty costs; and                                                                                                         
|
| |  | we may have to divert additional development resources to
    correct the defects and errors, which may result in delay of new
    product releases or upgrades.





| |                                                                                                                                                                                          
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We may have difficulties providing and managing large
    scale deployments, which could cause a decline or delay in
    recognition of our revenues and an increase ln our
    expenses.







| |                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | While we believe that we currently have adequate internal
    control over financial reporting, we are exposed to risks from
    recent legislation requiring companies to evaluate internal
    control over financial reporting.





48



---



##### Table of Contents







| |                                                                                                                               
| | ------------------------------------------------------------------------------------------------------------------------------
| | We cannot be certain that our internal control over
    financial reporting will be effective or sufficient in the
    future.





| |                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The software market in which we operate is subject to
    rapid technological change and new product introductions, which
    could negatively affect our product sales.





| |   |                                                                                    
| | - | -----------------------------------------------------------------------------------
| |  | adapting third-party technology, including open source software;                   
|
| |  | successful education and training of sales, marketing and
    consulting personnel;
|
| |  | effective marketing and market acceptance;                                         
|
| |  | proper positioning and pricing; and                                                
|
| |  | product quality, including possible defects.                                       





| |                                                                                                                                                                                                                                                                                                                         
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are currently a party to several lawsuits with
    MicroStrategy. The prosecution of these lawsuits could have a
    substantial negative impact on our business. Should
    MicroStrategy prevail, we may be required to pay substantial
    monetary damages or be prevented from selling some of our
    products.



49



---



##### Table of Contents















50



---



##### Table of Contents









| |                                                                                                                                                                                                                                   
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are a party to litigation with Vedatech Corporation
    and, in the event of an adverse judgment against us, we may have
    to pay damages, which could adversely affect our financial
    position and results of operations.









51



---



##### Table of Contents







| |                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We are a party to litigation with Informatica and, in the
    event of an adverse judgment against us, we may have to pay
    damages or be prevented from selling some of our products, which
    could adversely affect our financial position and results of
    operations.









| |                                                                                                                                                                                                  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The protection of our intellectual property rights is
    crucial to our business and, if third parties use our
    intellectual property without our consent, our business could be
    damaged.





| |   |                                                                                           
| | - | ------------------------------------------------------------------------------------------
| |  | policing unauthorized copying or use of our products is
    difficult and expensive;      
|
| |  | software piracy is a persistent problem in the software industry;                         
|
| |  | our patents may be challenged, invalidated or
    circumvented; and                       
|
| |  | our shrink-wrap licenses may be unenforceable under the laws of
    certain jurisdictions.





52



---



##### Table of Contents







| |                                                                                                                                                                                                                                                                                       
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Third parties have asserted that our technology infringes
    upon their proprietary rights, and others may do so in the
    future, which has resulted, and may in the future result, in
    costly litigation and could adversely affect our ability to
    distribute our products.







| |   |                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------
| |  | we could be forced to cease selling or delay shipping our
    products;                                             
|
| |  | we would be forced to commit management resources in defense of
    the claim;                                      
|
| |  | we may incur substantial litigation costs in defense of the
    claim;                                              
|
| |  | we may have to expend significant development resources to
    redesign our products; and                           
|
| |  | we may be required to enter into royalty and licensing
    agreements with such third party under unfavorable terms.









| |                                                                                            
| | -------------------------------------------------------------------------------------------
| | Our loss of rights to use software licensed from third
    parties could harm our business.



53



---



##### Table of Contents







| |                                                                                                      
| | -----------------------------------------------------------------------------------------------------
| | We depend on strategic relationships and business
    alliances for continued growth of our business.









| |                                                                                                                                                                        
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Our executive officers and key employees are crucial to
    our business, and we may not be able to recruit, integrate and
    retain the personnel we need to succeed.





| |                                                                                                     
| | ----------------------------------------------------------------------------------------------------
| | We have multinational operations that are subject to risks
    inherent in international operations.





| |   |                                                                                                                            
| | - | ---------------------------------------------------------------------------------------------------------------------------
| |  | technical difficulties and costs associated with product
    localization;                                                 
|
| |  | challenges associated with coordinating product development
    efforts among geographically dispersed development centers;

54



---



##### Table of Contents





| |   |                                                                                                                                                                                                                     
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | potential loss of proprietary information due to piracy,
    misappropriation, or laws that may be less protective of our
    intellectual property rights;                                                         
|
| |  | lack of experience in certain geographic markets;                                                                                                                                                                   
|
| |  | longer payment cycles for sales in certain foreign countries;                                                                                                                                                       
|
| |  | seasonal reductions in business activity in the summer months in
    Europe and certain other countries;                                                                                                            
|
| |  | the significant presence of some of our competitors in some
    international markets;                                                                                                                              
|
| |  | potentially adverse tax consequences;                                                                                                                                                                               
|
| |  | import and export restrictions and tariffs;                                                                                                                                                                         
|
| |  | foreign laws and other government controls, such as trade and
    employment restrictions;                                                                                                                          
|
| |  | management, staffing, legal and other costs of operating an
    enterprise spread over various countries;                                                                                                           
|
| |  | political instability in the countries where we are doing
    business; and                                                                                                                                         
|
| |  | fears concerning travel or health risks that may adversely
    affect our ability to sell our products and services in any
    country in which the business sales culture encourages
    face-to-face interactions.





| |                                                                                                                                                                                                                
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | The requirement to expense stock options in our income
    statement could have a significant adverse effect on our
    reported results, and we do not know how the market will react
    to reduced earnings.

Share-Based
Payments, Share-Based Payment






| |                                                                                                                                                                                                       
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Fluctuations in exchange rates between the euro, the
    U.S. dollar and the Canadian dollar, as well as other
    currencies in which we do business, may adversely affect our
    operating results.



55



---



##### Table of Contents







| |                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------
| | Our effective tax rate may increase or fluctuate, which
    could increase our income tax expense and reduce our net
    income.





| |   |                                                                                                                                                                                                                                                      
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | changes in forecasted annual operating income;                                                                                                                                                                                                       
|
| |  | changes in relative proportions of revenues and income before
    taxes in the various jurisdictions in which we operate;                                                                                                                            
|
| |  | changes to the valuation allowance on net deferred tax assets;                                                                                                                                                                                       
|
| |  | changes to actual or forecasted permanent differences between
    book and tax reporting, including the tax effects of purchase
    accounting for acquisitions and non-recurring charges which may
    cause fluctuations between reporting periods;
|
| |  | impacts from any future tax settlements with state, federal or
    foreign tax authorities;                                                                                                                                                          
|
| |  | impacts from changes in tax laws, regulations and
    interpretations in the jurisdictions in which we operate, as
    well as the requirements of certain tax rulings; or                                                                           
|
| |  | impacts from new FASB or IFRS requirements.                                                                                                                                                                                                          



| |                                                                                                                              
| | -----------------------------------------------------------------------------------------------------------------------------
| | Business disruptions could seriously harm our operations
    and financial condition and increase our costs and
    expenses.







56



---



##### Table of Contents











| |                                                                                                 
| | ------------------------------------------------------------------------------------------------
| | An SEC inquiry has required, and may continue to require,
    management time and legal expense.





| |                                                                                                                                                                                                                                                                                                                                           
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | We have been named as a party to several class action
    lawsuits and shareholder derivative actions which could result
    in significant management time and attention, result in
    significant legal expenses and have a material adverse effect on
    our business, financial condition, results of operations and
    cash flows.



Risks Related to Ownership of Our Ordinary Shares or ADSs




| |                                                                                                                                                                  
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------
| | New SAC and certain of its affiliates own a substantial
    percentage of our shares and their interests could conflict with
    those of our other shareholders.



57



---



##### Table of Contents





| |                                                                                                                                                                                                                    
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Additional sales of our shares by New SAC and certain of
    its affiliates, our employees or issuances by us in connection
    with future acquisitions could adversely affect the market price
    of our shares.





| |                                                                                                                                                                                                                   
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Provisions of our articles of association and French law
    could have anti-takeover effects and could deprive shareholders
    who do not comply with such provisions of some or all of their
    voting rights.

1 3 2 3  


1 3 2 3






58



---



##### Table of Contents





| |                                                                                                                                                                                                              
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Holders of our shares have limited rights to call
    shareholders meetings or submit shareholder proposals,
    which could adversely affect their ability to participate in
    governance of our company.





| |                                                                                                                                        
| | ---------------------------------------------------------------------------------------------------------------------------------------
| | Interests of our shareholders will be diluted if they are
    not able to exercise preferential subscription rights for our
    shares.

droits préférentiels de souscription






| |                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------
| | It may be difficult for holders of our ADSs rather than
    our ordinary shares to exercise some of their rights as
    shareholders.





| |                                                                                                                                                           
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------
| | Fluctuation in the value of the U.S. dollar relative
    to the euro may cause the price of our ordinary shares to
    deviate from the price of our ADSs.



59



---



##### Table of Contents





| |                                                                                                             
| | ------------------------------------------------------------------------------------------------------------
| | We have not distributed dividends to our shareholders and
    do not anticipate doing so in the near future.





| |                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------
| | The market price of our shares will be susceptible to
    changes in our operating results and to stock market
    fluctuations.





| |   |                                                                                                                                                                            
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |  | quarterly variations in our results of operations;                                                                                                                         
|
| |  | announcements of technological innovations or new products by
    us, our customers or competitors;                                                                        
|
| |  | announcements of our quarterly operating results and expected
    results of the future periods;                                                                           
|
| |  | our failure to achieve the operating results anticipated by
    analysts or investors;                                                                                     
|
| |  | sales or the perception in the market of possible sales of a
    large number of our shares by our directors, officers, employees
    or principal stockholders;           
|
| |  | announcements of our competitors or customers quarterly
    operating results, and expected results of future periods;                                                    
|
| |  | addition of significant new customers or loss of current
    customers;                                                                                                    
|
| |  | international political, socioeconomic and financial
    instability, including instability associated with military
    action in Afghanistan and Iraq or other conflicts;
|
| |  | releases or reports by or changes in security analysts
    recommendations; and                                                                                           
|
| |  | developments or disputes concerning patents or proprietary
    rights or other events.                                                                                     



60



---



##### Table of Contents








|         |                                                               
|-------- | --------------------------------------------------------------
|Item 7A. | Quantitative and Qualitative Disclosures About Market
    Risk

This discussion contains forward-looking statements that are
subject to risks and uncertainties. Actual results could vary
materially as a result of a number of factors including those
set forth in Managements Discussion and Analysis of
Financial Condition and Results of Operations 


Interest Rate Risk




Trading Securities




Foreign Exchange Risk




61



---



##### Table of Contents



Foreign Currency
Translation






Derivatives Risk


Accounting for Derivative
Instruments and Hedging Activities










62



---



##### Table of Contents





|                           |                                       |                                |  |          |          |  |  |          |          |  |          |      |  |  |  |        | 
|-------------------------- | ------------------------------------- | ------------------------------ |  | -------- | -------- |  |  | -------- | -------- |  | -------- | ---- |  |  |  | ------ | 
|                           |                                       | 2004                           |  |          | 2003     | 
|                           |                                       |                                |  |          |          | 
|                           |                                       |                                |  | Weighted |          |  |  |          | Weighted | 
|                           |                                       |                                |  | Average  |          |  |  |          | Average  | 
|                           |                                       | Notional                       |  |          | Contract |  |  | Notional |          |  | Contract |     
|                           |                                       | Amount                         |  |          | Rate (%) |  |  | Amount   |          |  | Rate (%) |     
|                           |                                       |                                |  |          |          |  |  |          |          |  |          |     
|                           |                                       | (Notional amounts in millions) | 
|Currency forward contracts |                                       |                                |  |          |          |  |  |          |          |  |          |      |  |  |  |       
|                           | U.S. dollars against euros            |                                |  | 178.4    |          |  |  | 1.1944   |          |  |          | 0.0  |  |  |  | 0.0000 | 
|                           | Canadian dollars against euros        |                                |  | 9.9      |          |  |  | 1.6235   |          |  |          | 0.0  |  |  |  | 0.0000 | 
|                           | British pounds against euros          |                                |  | 25.3     |          |  |  | 0.6843   |          |  |          | 0.0  |  |  |  | 0.0000 | 
|                           | Canadian dollars against U.S. dollars |                                |  | 0.0      |          |  |  | 0.0000   |          |  |          | 40.3 |  |  |  | 1.4004 | 





63



---



##### Table of Contents








|        |                                            
|------- | -------------------------------------------
|Item 8. | Financial Statements and Supplementary Data

BUSINESS OBJECTS S.A.


INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


|                                                                                                             |  |      |    | 
|------------------------------------------------------------------------------------------------------------ |  | ---- | -- | 
|                                                                                                             |  | Page |   
|                                                                                                             |  |      |   
|Reports of Independent Registered Public
    Accounting Firm                                                 |  |      | 65 | 
|Consolidated Balance Sheets as of
    December 31, 2004 and 2003                                             |  |      | 67 | 
|Consolidated Statements of Income for the
    Years Ended December 31, 2004, 2003 and 2002                   |  |      | 68 | 
|Consolidated Statements of
    Shareholders Equity for the Years Ended December 31,
    2004, 2003 and 2002 |  |      | 69 | 
|Consolidated Statements of Cash Flows for
    the Years Ended December 31, 2004, 2003 and 2002               |  |      | 70 | 
|Notes to Consolidated Financial
    Statements                                                               |  |      | 71 | 

64



---



##### Table of Contents






Report of Independent Registered Public Accounting Firm














| |                      
| | ---------------------
| | /s/ ERNST & YOUNG LLP





65



---



##### Table of Contents



Report of Independent Registered Public Accounting Firm


















| |                      
| | ---------------------
| | /s/ ERNST & YOUNG LLP





66



---



##### Table of Contents



BUSINESS OBJECTS S.A.





CONSOLIDATED BALANCE SHEETS


|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           |  |           |         |           | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------ | ------------------------------------------ | --------- | ------- | --------- |  | --------- | ------- | --------- | 
|                                                                                                                                                                                                                                                           |                                      | December 31,                               |          
|                                                                                                                                                                                                                                                           |                                      |                                            |          
|                                                                                                                                                                                                                                                           |                                      | 2004                                       |           |         | 2003      | 
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | (In thousands, except                      |          
|                                                                                                                                                                                                                                                           |                                      | nominal value per                          |          
|                                                                                                                                                                                                                                                           |                                      | ordinary share)                            |          
|ASSETS                                                                                                                                                                                                                                                    
|Current assets:                                                                                                                                                                                                                                            |                                      |                                            |           |         |           |  |           |        
|                                                                                                                                                                                                                                                           | Cash and cash equivalents            |                                            | $         | 293,485 |           |  | $         | 235,380 |          
|                                                                                                                                                                                                                                                           | Restricted cash                      |                                            |           | 14,043  |           |  |           | 19,243  |          
|                                                                                                                                                                                                                                                           | Short-term investments               |                                            |           | 3,831   |           |  |           | 3,332   |          
|                                                                                                                                                                                                                                                           | Accounts receivable, net             |                                            |           | 248,957 |           |  |           | 187,885 |          
|                                                                                                                                                                                                                                                           | Deferred tax assets                  |                                            |           | 8,328   |           |  |           | 261     |          
|                                                                                                                                                                                                                                                           | Prepaid and other current assets     |                                            |           | 46,575  |           |  |           | 30,465  |          
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | Total current assets                       |           |         | 615,219   |  |           |         | 476,566   | 
|Goodwill                                                                                                                                                                                                                                                   |                                      |                                            | 1,067,694 |         |           |  | 1,051,111 |        
|Other intangible assets, net                                                                                                                                                                                                                               |                                      |                                            | 124,599   |         |           |  | 149,143   |        
|Property and equipment, net                                                                                                                                                                                                                                |                                      |                                            | 64,053    |         |           |  | 61,187    |        
|Deposits and other assets                                                                                                                                                                                                                                  |                                      |                                            | 49,296    |         |           |  | 19,092    |        
|Long-term deferred tax assets                                                                                                                                                                                                                              |                                      |                                            | 2,067     |         |           |  | 17,963    |        
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | Total assets                               |           | $       | 1,922,928 |  |           | $       | 1,775,062 | 
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                          
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                                                                                                                                                                      
|Current liabilities:                                                                                                                                                                                                                                       |                                      |                                            |           |         |           |  |           |        
|                                                                                                                                                                                                                                                           | Accounts payable                     |                                            | $         | 40,939  |           |  | $         | 47,790  |          
|                                                                                                                                                                                                                                                           | Accrued payroll and related expenses |                                            |           | 84,918  |           |  |           | 84,686  |          
|                                                                                                                                                                                                                                                           | Income taxes payable                 |                                            |           | 85,000  |           |  |           | 75,727  |          
|                                                                                                                                                                                                                                                           | Deferred revenues                    |                                            |           | 200,682 |           |  |           | 135,977 |          
|                                                                                                                                                                                                                                                           | Restructuring liability              |                                            |           | 4,047   |           |  |           | 21,331  |          
|                                                                                                                                                                                                                                                           | Other current liabilities            |                                            |           | 79,497  |           |  |           | 51,814  |          
|                                                                                                                                                                                                                                                           | Escrows payable                      |                                            |           | 6,654   |           |  |           | 9,728   |          
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | Total current liabilities                  |           |         | 501,737   |  |           |         | 427,053   | 
|Long-term liabilities                                                                                                                                                                                                                                      |                                      |                                            | 6,448     |         |           |  | 4,950     |        
|Long-term deferred tax liabilities                                                                                                                                                                                                                         |                                      |                                            | 7,599     |         |           |  |          |        
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | Total liabilities                          |           |         | 515,784   |  |           |         | 432,003   | 
|Commitments and contingencies                                                                                                                                                                                                                              |                                      |                                            |           |         |           |  |           |        
|Shareholders equity:                                                                                                                                                                                                                                      |                                      |                                            |           |         |           |  |           |        
|Ordinary shares 
    0.10 nominal
    value ($0.14 U.S. and $0.13 respectively as of 2004 and 2003):
    authorized 122,334 and 114,809; issued  95,922 and
    94,903; issued and outstanding  92,220 and 89,166;
    for 2004 and 2003, respectively |                                      |                                            | 10,312    |         |           |  | 9,927     |        
|Additional paid-in capital                                                                                                                                                                                                                                 |                                      |                                            | 1,167,336 |         |           |  | 1,121,910 |        
|Treasury and Business Objects Option LLC shares, 6,769 and
    6,805, respectively                                                                                                                                                                         |                                      |                                            | (53,335   | )       |           |  | (13,104   | )      
|Retained earnings                                                                                                                                                                                                                                          |                                      |                                            | 249,720   |         |           |  | 202,597   |        
|Unearned compensation                                                                                                                                                                                                                                      |                                      |                                            | (8,079    | )       |           |  | (18,353   | )      
|Accumulated other comprehensive income                                                                                                                                                                                                                     |                                      |                                            | 41,190    |         |           |  | 40,082    |        
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | Total shareholders equity                 |           |         | 1,407,144 |  |           |         | 1,343,059 | 
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 
|                                                                                                                                                                                                                                                           |                                      | Total liabilities and shareholders equity |           | $       | 1,922,928 |  |           | $       | 1,775,062 | 
|                                                                                                                                                                                                                                                           |                                      |                                            |           |         |           | 



67



---



##### Table of Contents



BUSINESS OBJECTS S.A.





CONSOLIDATED STATEMENTS OF INCOME


|                                                                                                             |                                |                                          |         |         |         |   |         |         |         |   |         |         |         | 
|------------------------------------------------------------------------------------------------------------ | ------------------------------ | ---------------------------------------- | ------- | ------- | ------- | - | ------- | ------- | ------- | - | ------- | ------- | ------- | 
|                                                                                                             |                                | Year Ended December 31,                  |        
|                                                                                                             |                                |                                          |        
|                                                                                                             |                                | 2004                                     |         |         | 2003    |   |         | 2002    |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|                                                                                                             |                                | (In thousands, except per ordinary share |        
|                                                                                                             |                                | and ADS data)                            |        
|Revenues:                                                                                                    |                                |                                          |         |         |         |   |         |         |         |   |         |        
|                                                                                                             | Net license fees               |                                          | $       | 473,373 |         |   | $       | 275,261 |         |   | $       | 243,955 |        
|                                                                                                             | Services                       |                                          |         | 452,258 |         |   |         | 285,564 |         |   |         | 210,844 |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|                                                                                                             |                                | Total revenues                           |         |         | 925,631 |   |         |         | 560,825 |   |         |         | 454,799 | 
|Cost of revenues:                                                                                            |                                |                                          |         |         |         |   |         |         |         |   |         |        
|                                                                                                             | Net license fees               |                                          |         | 28,272  |         |   |         | 5,951   |         |   |         | 3,102   |        
|                                                                                                             | Services                       |                                          |         | 172,133 |         |   |         | 89,005  |         |   |         | 71,489  |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|                                                                                                             |                                | Total cost of revenues                   |         |         | 200,405 |   |         |         | 94,956  |   |         |         | 74,591  | 
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|                                                                                                             | Gross profit                   |                                          |         | 725,226 |         |   |         | 465,869 |         |   |         | 380,208 |        
|Operating expenses:                                                                                          |                                |                                          |         |         |         |   |         |         |         |   |         |        
|                                                                                                             | Sales and marketing            |                                          |         | 406,796 |         |   |         | 250,870 |         |   |         | 222,243 |        
|                                                                                                             | Research and development       |                                          |         | 150,562 |         |   |         | 95,399  |         |   |         | 74,991  |        
|                                                                                                             | General and administrative     |                                          |         | 83,947  |         |   |         | 44,655  |         |   |         | 29,387  |        
|                                                                                                             | Acquired in-process technology |                                          |         |        |         |   |         | 27,966  |         |   |         | 2,000   |        
|                                                                                                             | Restructuring costs            |                                          |         | 2,169   |         |   |         | 7,782   |         |   |         | 3,871   |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|                                                                                                             |                                | Total operating expenses                 |         |         | 643,474 |   |         |         | 426,672 |   |         |         | 332,492 | 
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Income from operations                                                                                       |                                |                                          | 81,752  |         |         |   | 39,197  |         |         |   | 47,716  |        
|Interest and other income (expense), net                                                                     |                                |                                          | (4,220  | )       |         |   | 14,334  |         |         |   | 18,959  |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Income before provision for income taxes                                                                     |                                |                                          | 77,532  |         |         |   | 53,531  |         |         |   | 66,675  |        
|Provision for income taxes                                                                                   |                                |                                          | (30,409 | )       |         |   | (30,969 | )       |         |   | (26,095 | )      
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Net income                                                                                                   |                                | $                                        | 47,123  |         |         | $ | 22,562  |         |         | $ | 40,580  |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Basic net income per ordinary share and ADS                                                                  |                                | $                                        | 0.53    |         |         | $ | 0.35    |         |         | $ | 0.66    |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Diluted net income per ordinary share and ADS                                                                |                                | $                                        | 0.52    |         |         | $ | 0.34    |         |         | $ | 0.63    |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Ordinary shares and ADSs used in computing basic net income per
    ordinary share and ADS                   |                                |                                          | 88,748  |         |         |   | 64,584  |         |         |   | 61,888  |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        
|Ordinary shares and ADSs and equivalents used in computing
    diluted net income per ordinary share and ADS |                                |                                          | 91,077  |         |         |   | 66,168  |         |         |   | 63,933  |        
|                                                                                                             |                                |                                          |         |         |         |   |         |         |        



68



---



##### Table of Contents



BUSINESS OBJECTS S.A.





CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY


|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |         |   |  |   |         |        |  |   |           |        | 
|--------------------------------------------------------------------------------------------------------------- | ---------------------- | --------------- | ------ | - | ---------- | ---------------- | ------ | ------------ |  | - | --------- | - | ----------- | -------- | ------ | - | ------------- | ----- | ------- | ------------- |  | - | ------------- | ------ |  | ------ | ------- | - |  | - | ------- | ------ |  | - | --------- | ------ | 
|                                                                                                                |                        |                 |        |   |            |                  |        | Treasury and |  |   |           |   |             |          |        |   |              
|                                                                                                                |                        |                 |        |   |            | Business Objects |        |              |  |   |           |   | Accumulated |          |        |  
|                                                                                                                |                        | Ordinary Shares |        |   | Additional |                  |        | LLC Shares   |  |   |           |   |             |          | Other  |   |               | Total |        
|                                                                                                                |                        |                 |        |   | Paid-In    |                  |        |              |  |   | Retained  |   |             | Unearned |        |   | Comprehensive |       |         | Shareholders | 
|                                                                                                                |                        | Shares          |        |   | Amount     |                  |        | Capital      |  |   | Shares    |   |             | Amount   |        |   | Earnings      |       |         | Compensation  |  |   | Income (Loss) |        |  | Equity |        
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|                                                                                                                |                        | (In thousands)  |       
|Balance at December 31, 2001                                                                                    |                        |                 | 61,928 |   |            | $                | 6,589  |              |  | $ | 149,889   |   |             |          | 818    |   |               | $     | (9,049  | )             |  | $ | 139,455       |        |  | $      |        |   |  | $ | (34,218 | )      |  | $ | 252,666   |       
|Issuance of ordinary shares pursuant to employee stock option
    plans                                         |                        |                 | 1,066  |   |            |                  | 99     |              |  |   | 10,184    |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 10,283    |       
|Issuance of ordinary shares under employee stock purchase plans                                                 |                        |                 | 388    |   |            |                  | 36     |              |  |   | 4,943     |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 4,979     |       
|Directors warrants exercise                                                                                    |                        |                 | 81     |   |            |                  | 7      |              |  |   | 274       |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 281       |       
|Purchase of treasury shares                                                                                     |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          | 250    |   |               |       | (4,055  | )             |  |   |              |        |  |        |        |   |  |   |        |        |  |   | (4,055    | )     
|Tax benefit of nonqualified stock options                                                                       |                        |                 |       |   |            |                  |       |              |  |   | 3,649     |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 3,649     |       
|Components of comprehensive income Translation adjustment                                                       |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   | 36,550  |        |  |   | 36,550    |       
|                                                                                                                | Net income             |                 |        |  |            |                  |        |             |  |   |           |  |             |          |        |  |               |       |         |              |  |   |               | 40,580 |  |        |         |  |  |   |         |       |  |   |           | 40,580 | 
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|Total comprehensive income                                                                                      |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 77,130    |       
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|Balance at December 31, 2002                                                                                    |                        |                 | 63,463 |   |            | $                | 6,731  |              |  | $ | 168,939   |   |             |          | 1,068  |   |               | $     | (13,104 | )             |  | $ | 180,035       |        |  | $      |        |   |  | $ | 2,332   |        |  | $ | 344,933   |       
|Issuance of ordinary shares in connection with purchase business
    combination, net of exchange costs of $201 |                        |                 | 23,301 |   |            |                  | 2,912  |              |  |   | 904,613   |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 907,525   |       
|Shares issued to Business Objects Option LLC                                                                    |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          | 6,310  |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   |          |       
|Stock-based compensation                                                                                        |                        |                 |       |   |            |                  |       |              |  |   | 992       |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 992       |       
|Deferred stock-based compensation                                                                               |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        | (19,788 | ) |  |   |        |        |  |   | (19,788   | )     
|Amortization of stock- based compensation                                                                       |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        | 646     |   |  |   |        |        |  |   | 646       |       
|Forfeiture of unvested stock options                                                                            |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        | 789     |   |  |   |        |        |  |   | 789       |       
|Tax benefit of nonqualified stock options                                                                       |                        |                 |       |   |            |                  |       |              |  |   | 17,974    |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 17,974    |       
|Issuance of ordinary shares pursuant to employee stock option
    plans                                         |                        |                 | 1,893  |   |            |                  | 227    |              |  |   | 23,797    |   |             |          | (573   | ) |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 24,024    |       
|Issuance of ordinary shares under employee stock purchase plans                                                 |                        |                 | 389    |   |            |                  | 43     |              |  |   | 4,928     |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 4,971     |       
|Directors warrants exercise                                                                                    |                        |                 | 120    |   |            |                  | 14     |              |  |   | 667       |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 681       |       
|Components of comprehensive income                                                                              |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |         |   |  |   |         |        |  |   |           |       
|                                                                                                                | Translation adjustment |                 |        |  |            |                  |        |             |  |   |           |  |             |          |        |  |               |       |         |              |  |   |               |       |  |        |         |  |  |   |         | 37,750 |  |   |           | 37,750 | 
|                                                                                                                | Net income             |                 |        |  |            |                  |        |             |  |   |           |  |             |          |        |  |               |       |         |              |  |   |               | 22,562 |  |        |         |  |  |   |         |       |  |   |           | 22,562 | 
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|Total comprehensive income                                                                                      |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 60,312    |       
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|Balance at December 31, 2003                                                                                    |                        |                 | 89,166 |   |            | $                | 9,927  |              |  | $ | 1,121,910 |   |             |          | 6,805  |   |               | $     | (13,104 | )             |  | $ | 202,597       |        |  | $      | (18,353 | ) |  | $ | 40,082  |        |  | $ | 1,343,059 |       
|Issuance of ordinary shares pursuant to employee stock option
    plans                                         |                        |                 | 2,678  |   |            |                  | 339    |              |  |   | 32,480    |   |             |          | (2,036 | ) |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 32,819    |       
|Issuance of ordinary shares under employee stock purchase plans                                                 |                        |                 | 376    |   |            |                  | 46     |              |  |   | 7,721     |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 7,767     |       
|Purchase of treasury shares                                                                                     |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          | 2,000  |   |               |       | (40,231 | )             |  |   |              |        |  |        |        |   |  |   |        |        |  |   | (40,231   | )     
|Tax benefit of nonqualified stock options                                                                       |                        |                 |       |   |            |                  |       |              |  |   | 8,812     |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 8,812     |       
|Amortization of stock- based compensation                                                                       |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        | 6,656   |   |  |   |        |        |  |   | 6,656     |       
|Forfeiture of unvested stock options                                                                            |                        |                 |       |   |            |                  |       |              |  |   | (3,618    | ) |             |          |       |   |               |       |        |               |  |   |              |        |  |        | 3,618   |   |  |   |        |        |  |   |          |       
|Stock based compensation                                                                                        |                        |                 |       |   |            |                  |       |              |  |   | 31        |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 31        |       
|Components of comprehensive income Translation adjustment                                                       |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   | 1,108   |        |  |   | 1,108     |       
|                                                                                                                | Net income             |                 |        |  |            |                  |        |             |  |   |           |  |             |          |        |  |               |       |         |              |  |   |               | 47,123 |  |        |         |  |  |   |         |       |  |   |           | 47,123 | 
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|Total comprehensive income                                                                                      |                        |                 |       |   |            |                  |       |              |  |   |          |   |             |          |       |   |               |       |        |               |  |   |              |        |  |        |        |   |  |   |        |        |  |   | 48,231    |       
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        
|Balance at December 31, 2004                                                                                    |                        |                 | 92,220 |   |            | $                | 10,312 |              |  | $ | 1,167,336 |   |             |          | 6,769  |   |               | $     | (53,335 | )             |  | $ | 249,720       |        |  | $      | (8,079  | ) |  | $ | 41,190  |        |  | $ | 1,407,144 |       
|                                                                                                                |                        |                 |        |   |            |                  |        |              |  |   |           |   |             |          |        |   |               |       |         |               |  |   |               |        |  |        |        



69



---



##### Table of Contents



BUSINESS OBJECTS S.A.





CONSOLIDATED STATEMENTS OF CASH FLOWS


|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |          |   |         |        |          |  
|----------------------------------------------------------------------------------------------- | ------------------------------------------------------- | ---------------------------------------------------- | ------- | ------- | ------- | - | -------- | ------- | -------- | - | ------- | ------ | -------- | -
|                                                                                                |                                                         | Year Ended December 31,                              |        
|                                                                                                |                                                         |                                                      |        
|                                                                                                |                                                         | 2004                                                 |         |         | 2003    |   |          | 2002    |         
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|                                                                                                |                                                         | (In thousands)                                       |        
|Operating activities:                                                                           |                                                         |                                                      |         |         |         |   |          |         |          |   |         |       
|Net income                                                                                      |                                                         | $                                                    | 47,123  |         |         | $ | 22,562   |         |          | $ | 40,580  |       
|Adjustments to reconcile net income to net cash provided by
    (used in) operating activities: |                                                         |                                                      |         |         |         |   |          |         |          |   |         |       
|                                                                                                | Depreciation and amortization of property and equipment |                                                      |         | 32,493  |         |   |          | 18,269  |          |   |         | 14,746 |         
|                                                                                                | Amortization of goodwill and other intangible assets    |                                                      |         | 30,780  |         |   |          | 4,344   |          |   |         | 3,363  |         
|                                                                                                | Stock-based compensation expense                        |                                                      |         | 6,687   |         |   |          | 1,638   |          |   |         |       |         
|                                                                                                | Acquired in-process technology                          |                                                      |         |        |         |   |          | 27,966  |          |   |         | 2,000  |         
|                                                                                                | Deferred income taxes                                   |                                                      |         | 14,708  |         |   |          | (1,664  | )        |   |         | (2,882 | )       
|                                                                                                | Tax benefits from employee stock plans                  |                                                      |         | 8,812   |         |   |          | 17,974  |          |   |         | 3,649  |         
|Changes in operating assets and liabilities:                                                    |                                                         |                                                      |         |         |         |   |          |         |          |   |         |       
|                                                                                                | Accounts receivable, net                                |                                                      |         | (51,809 | )       |   |          | (36,973 | )        |   |         | 784    |         
|                                                                                                | Prepaid and other current assets                        |                                                      |         | (15,042 | )       |   |          | (1,768  | )        |   |         | 3,400  |         
|                                                                                                | Deposits and other assets                               |                                                      |         | (30,777 | )       |   |          | (13,371 | )        |   |         | 65     |         
|                                                                                                | Accounts payable                                        |                                                      |         | (8,660  | )       |   |          | 8,118   |          |   |         | (2,216 | )       
|                                                                                                | Accrued payroll and related expenses                    |                                                      |         | (7,090  | )       |   |          | 13,383  |          |   |         | 6,754  |         
|                                                                                                | Income taxes payable                                    |                                                      |         | (9,948  | )       |   |          | 14,539  |          |   |         | (6,294 | )       
|                                                                                                | Deferred revenues                                       |                                                      |         | 58,186  |         |   |          | 35,657  |          |   |         | 7,947  |         
|                                                                                                | Restructuring liability and other current liabilities   |                                                      |         | 13,177  |         |   |          | (10,825 | )        |   |         | (4,559 | )       
|                                                                                                | Short-term investments classified as trading            |                                                      |         | (499    | )       |   |          | (1,350  | )        |   |         | (146   | )       
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|                                                                                                |                                                         | Net cash provided by operating activities            |         |         | 88,141  |   |          |         | 98,499   |   |         |        | 67,191   |  
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|Investing activities:                                                                           |                                                         |                                                      |         |         |         |   |          |         |          |   |         |       
|Purchases of property and equipment                                                             |                                                         |                                                      | (30,273 | )       |         |   | (12,453  | )       |          |   | (10,405 | )     
|Change in estimate in restructuring accrual for Acta acquisition                                |                                                         |                                                      |        |         |         |   | 2,741    |         |          |   |        |       
|Business acquisitions and other investments, net of acquired cash                               |                                                         |                                                      | (279    | )       |         |   | (178,327 | )       |          |   | (62,454 | )     
|Sales (purchases) of short-term investments                                                     |                                                         |                                                      |        |         |         |   | 53,662   |         |          |   | (45,240 | )     
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|                                                                                                |                                                         | Net cash used in investing activities                |         |         | (30,552 | ) |          |         | (134,377 | ) |         |        | (118,099 | )
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|Financing activities:                                                                           |                                                         |                                                      |         |         |         |   |          |         |          |   |         |       
|Issuance of shares                                                                              |                                                         |                                                      | 40,586  |         |         |   | 29,677   |         |          |   | 15,542  |       
|Purchase of treasury shares                                                                     |                                                         |                                                      | (40,231 | )       |         |   |         |         |          |   | (4,055  | )     
|Increase in escrow payable                                                                      |                                                         |                                                      |        |         |         |   |         |         |          |   | 9,728   |       
|Transfer of cash from (to) restricted cash accounts                                             |                                                         |                                                      | 5,200   |         |         |   | 1,150    |         |          |   | (9,106  | )     
|Payments on notes and escrows payable                                                           |                                                         |                                                      | (3,074  | )       |         |   | (1,717   | )       |          |   | (2,656  | )     
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|                                                                                                |                                                         | Net cash provided by financing activities            |         |         | 2,481   |   |          |         | 29,110   |   |         |        | 9,453    |  
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|Effect of foreign exchange rates changes on cash and cash
    equivalents                       |                                                         |                                                      | (1,965  | )       |         |   | 8,207    |         |          |   | 34,975  |       
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|                                                                                                |                                                         | Net increase (decrease) in cash and cash equivalents |         |         | 58,105  |   |          |         | 1,439    |   |         |        | (6,480   | )
|Cash and cash equivalents at the beginning of the year                                          |                                                         |                                                      | 235,380 |         |         |   | 233,941  |         |          |   | 240,421 |       
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|Cash and cash equivalents at the end of the year                                                |                                                         | $                                                    | 293,485 |         |         | $ | 235,380  |         |          | $ | 233,941 |       
|                                                                                                |                                                         |                                                      |         |         |         |   |          |         |         
|Supplemental cash flow information:                                                             |                                                         |                                                      |         |         |         |   |          |         |          |   |         |       
|Cash paid for interest expense                                                                  |                                                         | $                                                    | 93      |         |         | $ | 14       |         |          | $ | 169     |       
|Cash paid for income taxes, net of refunds                                                      |                                                         | $                                                    | 54,181  |         |         | $ | 33,218   |         |          | $ | 34,401  |       
|Value of shares issued for Crystal Decisions Acquisition                                        |                                                         | $                                                    |        |         |         | $ | 768,609  |         |          | $ |        |       



70



---



##### Table of Contents



Business Objects S.A.





Notes to Consolidated Financial Statements




|   |                                                                
|-- | ---------------------------------------------------------------
|1. | Organization and Summary of Significant Accounting
    Policies

Organization and Basis of
Presentation


société
anonyme




Cash and Cash
Equivalents, Restricted Cash and Short-Term
Investments.


Use of Estimates




Translation of Financial
Statements of Foreign Entities


Foreign Currency Translation


Revenue Recognition






71



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




Modification of SOP No. 97-2 with Respect to
Certain Transactions










72



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




| |                    
| | -------------------
| | Accounts Receivable







| |                                      
| | -------------------------------------
| | Net Income per Ordinary Share and ADS

Earnings per
Share




| |                                                                          
| | -------------------------------------------------------------------------
| | Cash and Cash Equivalents, Restricted Cash and Short-Term
    Investments



Accounting for Certain
Investments in Debt and Equity Securities Accounting for Deferred
Compensation Arrangements Where Amounts Earned are Held in a
Rabbi Trust and Invested






73



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




| |                                 
| | --------------------------------
| | Derivative Financial Instruments

Accounting for Derivative
Instruments and Hedging Activities




| |                      
| | ---------------------
| | Business Combinations

Business Combinations Recognition
of Liabilities in Connection with a Purchase Business
Combination




| |                    
| | -------------------
| | Restructuring Costs

Cost Associated with Exit or
Disposal Activities Liability
Recognition for Certain Employee Termination Benefits and Other
Costs to Exit an Activity




| |                                     
| | ------------------------------------
| | Goodwill and Other Intangible Assets

Goodwill and
Other Intangible Assets


74



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






| |                       
| | ----------------------
| | Property and Equipment



Accounting for the Costs of Computer Software Developed
or Obtained for Internal Use




| |                                
| | -------------------------------
| | Impairment of Long-Lived Assets

Impairment of
Long-Lived Assets Accounting for the Impairment of Long-Lived Assets and
for Long-Lived Assets to be Disposed Of




| |                          
| | -------------------------
| | Software Development Cost

Accounting
for the Costs of Computer Software to Be Sold, Leased, or
Otherwise Marketed




| |                             
| | ----------------------------
| | Concentration of Credit Risk



75



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






| |             
| | ------------
| | Income Taxes

Accounting for Income
Taxes






| |                          
| | -------------------------
| | Other Current Liabilities





| |                             
| | ----------------------------
| | Contingencies and Litigation

Accounting for
Contingencies




| |                     
| | --------------------
| | Comprehensive Income





| |                                        
| | ---------------------------------------
| | Accounting for Stock-based Compensation



76



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)


Accounting for Stock Issued to
Employees Accounting for Stock-Based
Compensation  Transition and Disclosure 
an Amendment of FASB Statement No. 123 Accounting for
Stock-Based Compensation Interim Financial Reporting






|                                                                                                                                           |  |                                          |         |   |      |   |         |      |  |   |         |  
|------------------------------------------------------------------------------------------------------------------------------------------ |  | ---------------------------------------- | ------- | - | ---- | - | ------- | ---- |  | - | ------- | -
|                                                                                                                                           |  | Year Ended December 31,                  |        
|                                                                                                                                           |  |                                          |        
|                                                                                                                                           |  | 2004                                     |         |   | 2003 |   |         | 2002 | 
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 
|                                                                                                                                           |  | (In thousands, except per ordinary share |        
|                                                                                                                                           |  | and ADS amounts)                         |        
|Net income  as reported                                                                                                                   |  | $                                        | 47,123  |   |      | $ | 22,562  |      |  | $ | 40,580  |  
|Add: Amortization of stock-based compensation expense included
    in reported net income, net of tax benefits                             |  |                                          | 4,146   |   |      |   | 1,015   |      |  |   |        |  
|Deduct: Stock-based employee compensation expense determined
    under the fair-value based method for all awards, net of tax
    benefits |  |                                          | (24,795 | ) |      |   | (26,946 | )    |  |   | (31,782 | )
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 
|Net income (loss)  pro forma                                                                                                              |  | $                                        | 26,474  |   |      | $ | (3,369  | )    |  | $ | 8,798   |  
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 
|Net income per ordinary share and ADS as reported 
    basic                                                                              |  | $                                        | 0.53    |   |      | $ | 0.35    |      |  | $ | 0.66    |  
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 
|Pro forma net income (loss) per ordinary share and
    ADS  basic                                                                         |  | $                                        | 0.30    |   |      | $ | (0.05   | )    |  | $ | 0.14    |  
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 
|Net income per ordinary share and ADS as reported 
    diluted                                                                            |  | $                                        | 0.52    |   |      | $ | 0.34    |      |  | $ | 0.63    |  
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 
|Pro forma net income (loss) per ordinary share and
    ADS  diluted                                                                       |  | $                                        | 0.29    |   |      | $ | (0.05   | )    |  | $ | 0.14    |  
|                                                                                                                                           |  |                                          |         |   |      |   |         |      | 





77



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)










| |                  
| | -----------------
| | Advertising Costs





| |                      
| | ---------------------
| | Recent Pronouncements

Share-Based Payments. Share-Based Payment, an
Amendment of FASB Statements No. 123 and 95 Share-Based Payment


Share-Based
Payment


78



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






|   |                                                  
|-- | -------------------------------------------------
|2. | Cash, Cash Equivalents and Short-term Investments



|                                                        |                                    |                                 |         |         |         |   |         |        |         | 
|------------------------------------------------------- | ---------------------------------- | ------------------------------- | ------- | ------- | ------- | - | ------- | ------ | ------- | 
|                                                        |                                    | December 31,                    |        
|                                                        |                                    |                                 |        
|                                                        |                                    | 2004                            |         |         | 2003    |  
|                                                        |                                    |                                 |         |         |         |  
|                                                        |                                    | (In thousands)                  |        
|Cash                                                    |                                    | $                               | 157,354 |         |         | $ | 115,708 |       
|Cash equivalents:                                       |                                    |                                 |         |         |         |   |         |       
|                                                        | Bank certificates of deposit       |                                 |         | 2,015   |         |   |         | 30,823 |        
|                                                        | Guaranteed investment certificates |                                 |         | 18,317  |         |   |         | 10,725 |        
|                                                        | Money market funds                 |                                 |         | 115,799 |         |   |         | 78,124 |        
|                                                        |                                    |                                 |         |         |         |  
|                                                        |                                    | Total cash equivalents          |         |         | 136,131 |   |         |        | 119,672 | 
|                                                        |                                    |                                 |         |         |         |  
|                                                        |                                    | Total cash and cash equivalents |         |         | 293,485 |   |         |        | 235,380 | 
|                                                        |                                    |                                 |         |         |         |  
|Short-term investments:                                 |                                    |                                 |         |         |         |   |         |       
|                                                        | Insurance dedicated mutual funds   |                                 |         | 3,831   |         |   |         | 3,332  |        
|                                                        |                                    |                                 |         |         |         |  
|                                                        |                                    | Total short-term investments    |         |         | 3,831   |   |         |        | 3,332   | 
|                                                        |                                    |                                 |         |         |         |  
|Total cash, cash equivalents and short-term investments |                                    | $                               | 297,316 |         |         | $ | 238,712 |       
|                                                        |                                    |                                 |         |         |         |  



79



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|   |                                 
|-- | --------------------------------
|3. | Derivative Financial Instruments



|                                                       |                                       |                                |      |          |          |  |  |          |          |   |          |      |  |  |  |        | 
|------------------------------------------------------ | ------------------------------------- | ------------------------------ | ---- | -------- | -------- |  |  | -------- | -------- | - | -------- | ---- |  |  |  | ------ | 
|                                                       |                                       | 2004(1)                        |      |          | 2003(2)  | 
|                                                       |                                       |                                |      |          |          | 
|                                                       |                                       |                                |      | Weighted |          |  |  |          | Weighted |  
|                                                       |                                       |                                |      | Average  |          |  |  |          | Average  |  
|                                                       |                                       | Notional                       |      |          | Contract |  |  | Notional |          |   | Contract |     
|                                                       |                                       | Amount                         |      |          | Rate (%) |  |  | Amount   |          |   | Rate (%) |     
|                                                       |                                       |                                |      |          |          |  |  |          |          |   |          |     
|                                                       |                                       | (Notional amounts in millions) |     
|Currency forward contracts                             |                                       |                                |      |          |          |  |  |          |          |   |          |      |  |  |  |       
|                                                       | U.S. dollars against euros            |                                |      | 178.4    |          |  |  | 1.1944   |          |   |          | 0.0  |  |  |  | 0.0000 | 
|                                                       | Canadian dollars against euros        |                                |      | 9.9      |          |  |  | 1.6235   |          |   |          | 0.0  |  |  |  | 0.0000 | 
|                                                       | British pounds against euros          |                                |      | 25.3     |          |  |  | 0.6843   |          |   |          | 0.0  |  |  |  | 0.0000 | 
|                                                       | Canadian dollars against U.S. dollars |                                |      | 0.0      |          |  |  | 0.0000   |          |   |          | 40.3 |  |  |  | 1.4004 | 
|U.S. dollar equivalent fair value of forward contracts |                                       | $                              | 25.8 |          |          |  |  |          |          | $ | 2.2      |      |  |  |  |       






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | During 2004, the Company entered into various euro-denominated
    forward contracts to purchase U.S. dollars, Canadian
    dollars and British pounds at a future date to enable its Irish
    subsidiary to settle intercompany loan obligations in those
    currencies. The forward contracts held at December 31, 2004
    have maturity dates that coincide with the payment of
    intercompany loan obligations from April to October 2005. These
    forward contracts did not qualify for hedge accounting.



| |                                                                                                                                                                                                                                                                                                                                                                                                                      
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | At December 31, 2004, a forward contract liability of
    $25.8 million was recorded in other current liabilities on
    the balance sheet, which represents the fair value of these
    forward contracts. During 2004, the Company recognized
    $24.5 million of mark-to-market losses on these forward
    contracts. These losses were materially offset by gains on the
    revaluation of intercompany loans.



|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The Company previously entered into forward contracts to hedge
    forecasted Canadian dollar expenses against fluctuations in the
    U.S. dollar to Canadian dollar (Cdn $)
    exchange rate. The purchase of these forward contracts was
    intended to mitigate the expenses adversely affected due to
    changes in the U.S. dollar to Canadian dollar exchange
    rate. As of December 31, 2004, all contracts had either
    matured or were accelerated to maturity. The forward contracts
    held at December 31, 2003, did not qualify for hedge
    accounting; therefore, the change in the fair value of the
    forward contracts at each period-end was reflected in other
    income (expense) and partially offset the foreign exchange
    variation in the corresponding Canadian dollar operating
    expenses during the same period. During 2004, the Company
    realized foreign exchange gains of $1.8 million related to
    these contracts. At December 31, 2003, a forward contract
    asset of $2.2 million was recorded in other current assets
    on the balance sheet, which represents the fair value of these
    forward contracts.



80



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|   |                       
|-- | ----------------------
|4. | Property and Equipment



|                              |                                           |              |         |         |      |   |        |         |  
|----------------------------- | ----------------------------------------- | ------------ | ------- | ------- | ---- | - | ------ | ------- | -
|                              |                                           | December 31, |        
|                              |                                           |              |        
|                              |                                           | 2004         |         |         | 2003 |  
|                              |                                           |              |         |         |      |  
|Office and computer equipment |                                           | $            | 116,093 |         |      | $ | 85,039 |        
|Leasehold improvements        |                                           |              | 33,699  |         |      |   | 25,842 |        
|                              |                                           |              |         |         |      |  
|                              | Total property and equipment              |              |         | 149,792 |      |   |        | 110,881 |  
|                              | Accumulated depreciation and amortization |              |         | (85,739 | )    |   |        | (49,694 | )
|                              |                                           |              |         |         |      |  
|Property and equipment, net   |                                           | $            | 64,053  |         |      | $ | 61,187 |        
|                              |                                           |              |         |         |      |  





|   |             
|-- | ------------
|5. | Acquisitions



| |                  
| | -----------------
| | Crystal Decisions









81



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|                                             |  |            |       |           |             |  |         | 
|-------------------------------------------- |  | ---------- | ----- | --------- | ----------- |  | ------- | 
|                                             |  |            |       | Estimated |            
|                                             |  | Fair Value |       |           | Useful Life | 
|                                             |  |            |       |           |             | 
|Developed technology                         |  | $          | 92.6  |           |             |  | 5 years | 
|Maintenance and support contracts            |  |            | 43.7  |           |             |  | 5 years | 
|Trade names                                  |  |            | 6.4   |           |             |  | 5 years | 
|                                             |  |            |       |           |             | 
|Total amortizable intangible assets acquired |  | $          | 142.7 |           |             |  |         | 
|                                             |  |            |       |           |             | 





| |                      
| | ---------------------
| | Acta Technology, Inc.







| |                              
| | -----------------------------
| | Other Prior Year Acquisitions





|   |                                     
|-- | ------------------------------------
|6. | Goodwill and Other Intangible Assets



82



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






|                                                                                                    |  |              |           |  |      |   |           |  
|--------------------------------------------------------------------------------------------------- |  | ------------ | --------- |  | ---- | - | --------- | -
|                                                                                                    |  | December 31, |          
|                                                                                                    |  |              |          
|                                                                                                    |  | 2004         |           |  | 2003 |  
|                                                                                                    |  |              |           |  |      |  
|Balance, beginning of the year                                                                      |  | $            | 1,051,111 |  |      | $ | 75,416    |  
|Add: Goodwill acquired or adjusted during the year (note 5)                                         |  |              | 16,567    |  |      |   | 978,017   |  
|Reduction in carrying value of Acta goodwill related to savings
    from early termination of lease |  |              |          |  |      |   | (2,741    | )
|Impact of currency fluctuations on goodwill                                                         |  |              | 16        |  |      |   | 419       |  
|                                                                                                    |  |              |           |  |      |  
|Balance, end of the year                                                                            |  | $            | 1,067,694 |  |      | $ | 1,051,111 |  
|                                                                                                    |  |              |           |  |      |  







|                                  |                               |                              |         |         |         |   |         |         |         | 
|--------------------------------- | ----------------------------- | ---------------------------- | ------- | ------- | ------- | - | ------- | ------- | ------- | 
|                                  |                               | December 31,                 |        
|                                  |                               |                              |        
|                                  |                               | 2004                         |         |         | 2003    |  
|                                  |                               |                              |         |         |         |  
|Employment contracts              |                               | $                            | 7,434   |         |         | $ | 7,434   |        
|Developed technology              |                               |                              | 109,882 |         |         |   | 102,151 |        
|Maintenance and support contracts |                               |                              | 46,440  |         |         |   | 46,440  |        
|Trade names                       |                               |                              | 6,909   |         |         |   | 6,377   |        
|                                  |                               |                              |         |         |         |  
|                                  | Total other intangible assets |                              |         | 170,665 |         |   |         | 162,402 |        
|                                  | Accumulated amortization      |                              |         | (46,066 | )       |   |         | (13,259 | )      
|                                  |                               |                              |         |         |         |  
|                                  |                               | Other intangible assets, net |         | $       | 124,599 |   |         | $       | 149,143 | 
|                                  |                               |                              |         |         |         |  





83



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






|     |       |                |        |         | 
|---- | ----- | -------------- | ------ | ------- | 
|     |       | (In thousands) |       
|     |       |                |       
|2005 |       | $              | 32,537 |        
|2006 |       | $              | 32,537 |        
|2007 |       | $              | 31,057 |        
|2008 |       | $              | 28,468 |        
|     |       |                |       
|     | Total |                | $      | 124,599 | 
|     |       |                |       



|   |                              
|-- | -----------------------------
|7. | Commitments and Contingencies



| |            
| | -----------
| | Commitments



|           |       |                |        |         | 
|---------- | ----- | -------------- | ------ | ------- | 
|           |       | (In thousands) |       
|           |       |                |       
|2005       |       | $              | 38,027 |        
|2006       |       |                | 34,327 |        
|2007       |       |                | 32,424 |        
|2008       |       |                | 31,086 |        
|2009       |       |                | 25,880 |        
|Thereafter |       |                | 83,560 |        
|           |       |                |       
|           | Total |                | $      | 245,304 | 
|           |       |                |       





84



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






| |              
| | -------------
| | Legal matters







85



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)












86



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






Bryan Aronoff,
et al. v. Bernard Liautaud, et al. and Ken
Dahms v. Bernard Liautaud, et al.






|   |                     
|-- | --------------------
|8. | Shareholders Equity



| |                                                                            
| | ---------------------------------------------------------------------------
| | Ordinary Shares, Treasury Shares and Business Objects
    Option LLC Shares

Treasury and Business
Objects Option LLC Shares


87



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






| |                          
| | -------------------------
| | Stock Repurchase Programs

    


   


  




| |                               
| | ------------------------------
| | Stock Option Exchange Programs



| |                                   
| | ----------------------------------
| | 2002 Stock Option Exchange Program




88



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




  








| |                
| | ---------------
| | Dividend Rights

statuts,








| |                   
| | ------------------
| | Liquidation Rights



89



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






| |                               
| | ------------------------------
| | Preemptive Subscription Rights





| |                      
| | ---------------------
| | Unearned Compensation





| |                               
| | ------------------------------
| | Stock Based Compensation Plans





90



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




| |                   
| | ------------------
| | Stock Option Plans



|                                                 |  |               |            |                     |           |          |            |          |  |   |       | 
|------------------------------------------------ |  | ------------- | ---------- | ------------------- | --------- | -------- | ---------- | -------- |  | - | ----- | 
|                                                 |  |               |            | Options Outstanding |          
|                                                 |  |               |            |                     |          
|                                                 |  |               |            |                     |           | Weighted |           
|                                                 |  | Options       |            |                     |           |          | Average    |         
|                                                 |  | Available for |            |                     | Number of |          |            | Exercise | 
|                                                 |  | Grant         |            |                     | Shares    |          |            | Price    | 
|                                                 |  |               |            |                     |           |          |            |          | 
|Balance at December 31, 2001                     |  |               | 2,931,765  |                     |           |          | 10,446,999 |          |  |  | 30.10 | 
|Granted                                          |  |               | (3,147,045 | )                   |           |          | 3,147,045  |          |  |  | 32.89 | 
|Canceled                                         |  |               | 4,370,894  |                     |           |          | (4,502,626 | )        |  |  | 40.72 | 
|Exercised                                        |  |               |           |                     |           |          | (1,066,222 | )        |  |  | 10.58 | 
|                                                 |  |               |            |                     |           |          |            |          | 
|Balance at December 31, 2002                     |  |               | 4,155,614  |                     |           |          | 8,025,196  |          |  |  | 27.83 | 
|                                                 |  |               |            |                     |           |          |            |          | 
|Shares reserved                                  |  |               | 3,212,729  |                     |           |          |           |          |  |   |      | 
|Granted                                          |  |               | (4,968,271 | )                   |           |          | 4,968,271  |          |  |  | 22.16 | 
|Options assumed in Crystal Decisions Acquisition |  |               |           |                     |           |          | 6,306,939  |          |  |  | 13.12 | 
|Canceled                                         |  |               | 1,077,901  |                     |           |          | (1,214,343 | )        |  |  | 34.31 | 
|Exercised                                        |  |               |           |                     |           |          | (1,893,522 | )        |  |  | 10.78 | 
|                                                 |  |               |            |                     |           |          |            |          | 
|Balance at December 31, 2003                     |  |               | 3,477,973  |                     |           |          | 16,192,541 |          |  |  | 21.87 | 
|                                                 |  |               |            |                     |           |          |            |          | 
|Granted                                          |  |               | (3,178,057 | )                   |           |          | 3,178,057  |          |  |  | 20.95 | 
|Canceled                                         |  |               | 1,711,794  |                     |           |          | (3,167,735 | )        |  |  | 26.67 | 
|Options expired under the 1999 Plan              |  |               | (54,992    | )                   |           |          |           |          |  |   |      | 
|Exercised                                        |  |               |           |                     |           |          | (2,678,298 | )        |  |  | 9.70  | 
|                                                 |  |               |            |                     |           |          |            |          | 
|Balance at December 31, 2004                     |  |               | 1,956,718  |                     |           |          | 13,524,565 |          |  |  | 22.36 | 
|                                                 |  |               |            |                     |           |          |            |          | 

91



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|                                 |  |             |            |  |            |  |                     |                |  |          |           |  |  |                |           |  |  |  |       | 
|-------------------------------- |  | ----------- | ---------- |  | ---------- |  | ------------------- | -------------- |  | -------- | --------- |  |  | -------------- | --------- |  |  |  | ----- | 
|Options Outstanding              |  |             |            |  |           
|                                 |  |             |           
|                                 |  | Weighted    |            |  |            |  | Exercisable Options |               
|                                 |  | Average     |            |  |            |  |                     |               
|                                 |  | Remaining   |            |  | Weighted   |  |                     |                |  | Weighted |          
|                                 |  | Contractual |            |  | Average    |  |                     |                |  | Average  |          
|                                 |  | Number of   |            |  | Life       |  |                     | Exercise       |  |          | Number of |  |  | Exercise       |          
|Range of Exercise Prices in Euro |  | Shares      |            |  | (in years) |  |                     | Price in Euros |  |          | Shares    |  |  | Price in Euros |          
|                                 |  |             |            |  |            |  |                     |                |  |          |           |  |  |                |          
|2.36 
    6.76                 |  |             | 431,966    |  |            |  | 2.8                 |                |  |          | 4.05      |  |  |                | 431,966   |  |  |  | 4.05  | 
|6.77 
    12.96                |  |             | 2,794,738  |  |            |  | 5.7                 |                |  |          | 9.35      |  |  |                | 2,278,486 |  |  |  | 9.06  | 
|12.97 
    18.14               |  |             | 3,335,575  |  |            |  | 8.6                 |                |  |          | 16.48     |  |  |                | 983,680   |  |  |  | 15.99 | 
|18.15 
    25.92               |  |             | 3,291,555  |  |            |  | 8.3                 |                |  |          | 23.55     |  |  |                | 1,045,675 |  |  |  | 22.18 | 
|25.93 
    27.03               |  |             | 6,800      |  |            |  | 9.1                 |                |  |          | 26.67     |  |  |                |          |  |  |  |      | 
|27.04 
    33.79               |  |             | 1,420,728  |  |            |  | 8.0                 |                |  |          | 29.54     |  |  |                | 521,546   |  |  |  | 30.04 | 
|33.80 
    54.06               |  |             | 1,642,777  |  |            |  | 5.9                 |                |  |          | 38.72     |  |  |                | 1,434,129 |  |  |  | 38.55 | 
|54.07 
    60.82               |  |             | 313,310    |  |            |  | 5.0                 |                |  |          | 54.93     |  |  |                | 309,342   |  |  |  | 54.93 | 
|60.83 
    67.58               |  |             | 287,116    |  |            |  | 5.4                 |                |  |          | 66.35     |  |  |                | 287,116   |  |  |  | 66.35 | 
|                                 |  |             |            |  |            |  |                     |                |  |          |           |  |  |                |          
|                                 |  |             | 13,524,565 |  |            |  | 7.2                 |                |  |          | 22.36     |  |  |                | 7,291,940 |  |  |  | 23.08 | 
|                                 |  |             |            |  |            |  |                     |                |  |          |           |  |  |                |          

General Stock Option Terms. Premier Marché)






2001 Stock Incentive Plan.


92



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)







1999 Stock Option Plan.




Business Objects Americas 1999 Stock Option Plan.








93



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)


Warrants.    

















Employee Stock Purchase Plans.




94



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






| |                                             
| | --------------------------------------------
| | Pro forma Effect of Stock-based Compensation

Accounting for Stock-based Compensation.




|                                                                                                                                                       |  |                         |       |   |      |   |       |      |  |   |       |  
|------------------------------------------------------------------------------------------------------------------------------------------------------ |  | ----------------------- | ----- | - | ---- | - | ----- | ---- |  | - | ----- | -
|                                                                                                                                                       |  | Year Ended December 31, |      
|                                                                                                                                                       |  |                         |      
|                                                                                                                                                       |  | 2004                    |       |   | 2003 |   |       | 2002 | 
|                                                                                                                                                       |  |                         |       |   |      |   |       |      | 
|Expected life of employee stock options and warrants (in years)                                                                                        |  |                         | 3.0   |   |      |   | 3.0   |      |  |   | 3.0   |  
|Volatility                                                                                                                                             |  |                         | 59    | % |      |   | 71    | %    |  |   | 71    | %
|Risk-free interest rate                                                                                                                                |  |                         | 2.7   | % |      |   | 2.2   | %    |  |   | 3.2   | %
|Dividend yields                                                                                                                                        |  |                         | 0     | % |      |   | 0     | %    |  |   | 0     | %
|Weighted average fair value of stock options under employee
    stock option plans granted during the period and warrants issued
    during the period |  | $                       | 11.16 |   |      | $ | 12.34 |      |  | $ | 11.15 |  



|                                                                                                       |  |                         |      |   |      |   |      |      |  |   |      |  
|------------------------------------------------------------------------------------------------------ |  | ----------------------- | ---- | - | ---- | - | ---- | ---- |  | - | ---- | -
|                                                                                                       |  | Year Ended December 31, |     
|                                                                                                       |  |                         |     
|                                                                                                       |  | 2004                    |      |   | 2003 |   |      | 2002 | 
|                                                                                                       |  |                         |      |   |      |   |      |      | 
|Expected life of employee stock purchase plans (in months)                                             |  |                         | 6.0  |   |      |   | 6.0  |      |  |   | 6.0  |  
|Volatility                                                                                             |  |                         | 51   | % |      |   | 67   | %    |  |   | 71   | %
|Risk-free interest rate                                                                                |  |                         | 1.0  | % |      |   | 1.5  | %    |  |   | 2.5  | %
|Dividend yields                                                                                        |  |                         | 0    | % |      |   | 0    | %    |  |   | 0    | %
|Weighted average fair value of shares under employee stock
    purchase plans issued during the period |  | $                       | 7.09 |   |      | $ | 4.59 |      |  | $ | 8.38 |  



|   |                                          
|-- | -----------------------------------------
|9. | Employer Sponsored Employee Savings Plans



95



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)












| |                                          
| | -----------------------------------------
| | Pension Plans and Termination Indemnities

Employers Accounting for
Pensions Employers
Disclosures about Pensions and Other Postretirement
Benefit  an amendment of FASB Statements No. 87,
88 and 106


96



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




| |                    
| | -------------------
| | French Pension Plan







| |                  
| | -----------------
| | Italian Indemnity



97



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|    |                                      
|--- | -------------------------------------
|10. | Net Income Per Ordinary Share and ADS



|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |        | 
|----------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------- | ---- | ------ | ---- | - | ---- | ------ |  | - | ---- | ------ | 
|                                                |                                                                                                                                                                     | Year Ended December 31, |     
|                                                |                                                                                                                                                                     |                         |     
|                                                |                                                                                                                                                                     | 2004                    |      |        | 2003 |   |      | 2002   | 
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|Basic net income per share:                     |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |       
|Numerator:                                      |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |       
|                                                | Net income                                                                                                                                                          |                         | $    | 47,123 |      |   | $    | 22,562 |  |   | $    | 40,580 | 
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|Denominator:                                    |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |       
|                                                | Weighed average ordinary shares and ADSs outstanding 
    basic                                                                                                    |                         |      | 88,748 |      |   |      | 64,584 |  |   |      | 61,888 | 
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|Net income per ordinary share and ADS  basic   |                                                                                                                                                                     | $                       | 0.53 |        |      | $ | 0.35 |        |  | $ | 0.66 |       
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|Diluted net income per share:                   |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |       
|Numerator:                                      |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |       
|                                                | Net income                                                                                                                                                          |                         | $    | 47,123 |      |   | $    | 22,562 |  |   | $    | 40,580 | 
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|Denominator:                                    |                                                                                                                                                                     |                         |      |        |      |   |      |        |  |   |      |       
|                                                | Weighed average ordinary shares and ADSs outstanding 
    basic                                                                                                    |                         |      | 88,748 |      |   |      | 64,584 |  |   |      | 61,888 | 
|                                                | Incremental ordinary shares and ADSs attributable to shares
    exercisable under employee stock option and purchase plans and
    warrants (treasury stock method) |                         |      | 2,329  |      |   |      | 1,584  |  |   |      | 2,045  | 
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|                                                | Weighted average ordinary shares and ADSs
    outstanding  diluted                                                                                                 |                         |      | 91,077 |      |   |      | 66,168 |  |   |      | 63,933 | 
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 
|Net income per ordinary share and ADS  diluted |                                                                                                                                                                     | $                       | 0.52 |        |      | $ | 0.34 |        |  | $ | 0.63 |       
|                                                |                                                                                                                                                                     |                         |      |        |      |   |      |        | 





98



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|    |                                         
|--- | ----------------------------------------
|11. | Interest and Other Income (Expense), Net



|                                      |                                                |                                             |         |        |       |   |       |        |       |   |       |        |        | 
|------------------------------------- | ---------------------------------------------- | ------------------------------------------- | ------- | ------ | ----- | - | ----- | ------ | ----- | - | ----- | ------ | ------ | 
|                                      |                                                | Year Ended December 31,                     |        
|                                      |                                                |                                             |        
|                                      |                                                | 2004                                        |         |        | 2003  |   |       | 2002   |      
|                                      |                                                |                                             |         |        |       |   |       |        |      
|Net interest income                   |                                                | $                                           | 3,696   |        |       | $ | 7,142 |        |       | $ | 7,679 |       
|Patent infringement settlement income |                                                |                                             |         |        |       |   |       |        |       |   |       |       
|                                      |                                                | Cognos payments, net of litigation expenses |         |        | 3,500 |   |       |        | 7,000 |   |       |        | 10,361 | 
|                                      |                                                | Brio payments                               |         |        |      |   |       |        |      |   |       |        | 1,500  | 
|Net exchange losses                   |                                                |                                             | (11,587 | )      |       |   | (406  | )      |       |   | (710  | )     
|Other income (loss), net              |                                                |                                             | 171     |        |       |   | 598   |        |       |   | 129   |       
|                                      |                                                |                                             |         |        |       |   |       |        |      
|                                      | Total interest and other income (expense), net |                                             | $       | (4,220 | )     |   | $     | 14,334 |       |   | $     | 18,959 |       
|                                      |                                                |                                             |         |        |       |   |       |        |      







99



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|    |             
|--- | ------------
|12. | Income Taxes



|              |       |                         |        |        |      |   |        |        |  |   |        |        | 
|------------- | ----- | ----------------------- | ------ | ------ | ---- | - | ------ | ------ |  | - | ------ | ------ | 
|              |       | Year Ended December 31, |       
|              |       |                         |       
|              |       | 2004                    |        |        | 2003 |   |        | 2002   | 
|              |       |                         |        |        |      |   |        |        | 
|France        |       | $                       | 21,418 |        |      | $ | 21,612 |        |  | $ | 40,969 |       
|Rest of world |       |                         | 56,114 |        |      |   | 31,919 |        |  |   | 25,706 |       
|              |       |                         |        |        |      |   |        |        | 
|              | Total |                         | $      | 77,532 |      |   | $      | 53,531 |  |   | $      | 66,675 | 
|              |       |                         |        |        |      |   |        |        | 



|              |                |                         |        |        |      |   |         |         |   |   |        |        |  
|------------- | -------------- | ----------------------- | ------ | ------ | ---- | - | ------- | ------- | - | - | ------ | ------ | -
|              |                | Year Ended December 31, |       
|              |                |                         |       
|              |                | 2004                    |        |        | 2003 |   |         | 2002    |  
|              |                |                         |        |        |      |   |         |         |  
|Current:      |                |                         |        |        |      |   |         |         |   |   |        |       
|France        |                | $                       | 5,867  |        |      | $ | 21,202  |         |   | $ | 16,595 |       
|Rest of world |                |                         | 26,717 |        |      |   | 69,347  |         |   |   | 12,520 |       
|              |                |                         |        |        |      |   |         |         |  
|              | Total current  |                         | $      | 32,584 |      |   | $       | 90,549  |   |   | $      | 29,115 |  
|              |                |                         |        |        |      |   |         |         |  
|Deferred:     |                |                         |        |        |      |   |         |         |   |   |        |       
|France        |                | $                       | 2,702  |        |      | $ | (15,867 | )       |   | $ | (2,933 | )     
|Rest of world |                |                         | (4,877 | )      |      |   | (43,713 | )       |   |   | (87    | )     
|              |                |                         |        |        |      |   |         |         |  
|              | Total deferred |                         | $      | (2,175 | )    |   | $       | (59,580 | ) |   | $      | (3,020 | )
|              |                |                         |        |        |      |   |         |         |  
|              | Total          |                         | $      | 30,409 |      |   | $       | 30,969  |   |   | $      | 26,095 |  
|              |                |                         |        |        |      |   |         |         |  





|                                                               |       |                         |        |        |      |   |        |        |  |   |        |        | 
|-------------------------------------------------------------- | ----- | ----------------------- | ------ | ------ | ---- | - | ------ | ------ |  | - | ------ | ------ | 
|                                                               |       | Year Ended December 31, |       
|                                                               |       |                         |       
|                                                               |       | 2004                    |        |        | 2003 |   |        | 2002   | 
|                                                               |       |                         |        |        |      |   |        |        | 
|Income tax provision computed at the French statutory rate     |       | $                       | 27,470 |        |      | $ | 18,966 |        |  | $ | 23,623 |       
|Non-deductible acquired in-process technology                  |       |                         |       |        |      |   | 9,963  |        |  |   | 709    |       
|Operating losses not utilized                                  |       |                         |       |        |      |   | 667    |        |  |   | 289    |       
|Income at higher (lower) tax rates                             |       |                         | (6,808 | )      |      |   | 255    |        |  |   | 96     |       
|Research and development tax credits                           |       |                         | (3,911 | )      |      |   | (3,595 | )      |  |   | (1,046 | )     
|Net expense on intercompany transfers of intellectual property |       |                         | 11,761 |        |      |   |       |        |  |   |       |       
|Other individually immaterial items                            |       |                         | 1,897  |        |      |   | 4,713  |        |  |   | 2,424  |       
|                                                               |       |                         |        |        |      |   |        |        | 
|                                                               | Total |                         | $      | 30,409 |      |   | $      | 30,969 |  |   | $      | 26,095 | 
|                                                               |       |                         |        |        |      |   |        |        | 

100



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|                          |                                                                 |                                |                            |         |         |       |   |         |         |        | 
|------------------------- | --------------------------------------------------------------- | ------------------------------ | -------------------------- | ------- | ------- | ----- | - | ------- | ------- | ------ | 
|                          |                                                                 | December 31,                   |                           
|                          |                                                                 |                                |                           
|                          |                                                                 | 2004                           |                            |         | 2003    |      
|                          |                                                                 |                                |                            |         |         |      
|Deferred tax assets:      |                                                                 |                                |                            |         |         |       |   |        
|                          | Net operating loss carryforwards                                |                                | $                          | 33,014  |         |       | $ | 27,332  |        
|                          | Cognos settlement                                               |                                |                            |        |         |       |   | 1,630   |        
|                          | Deferred revenues                                               |                                |                            | 478     |         |       |   | 4,310   |        
|                          | Accrued bonuses and compensation                                |                                |                            | 17,839  |         |       |   | 13,482  |        
|                          | Amortization of intangible assets                               |                                |                            | 9,396   |         |       |   | 13,611  |        
|                          | Accrued rent                                                    |                                |                            | 1,581   |         |       |   | 1,248   |        
|                          | Prepaid expenses                                                |                                |                            |        |         |       |   | 13,205  |        
|                          | Depreciation                                                    |                                |                            | 6,151   |         |       |   | 6,995   |        
|                          | Other, including reserves and accruals not currently deductible |                                |                            | 13,097  |         |       |   | 9,472   |        
|                          |                                                                 |                                |                            |         |         |      
|                          | Total deferred tax assets                                       |                                |                            | 81,556  |         |       |   | 91,285  |        
|                          | Valuation allowance                                             |                                |                            | (59,994 | )       |       |   | (49,265 | )      
|                          |                                                                 |                                |                            |         |         |      
|                          |                                                                 | Total deferred tax assets      |                            | $       | 21,562  |       |   | $       | 42,020  |       
|                          |                                                                 |                                |                            |         |         |      
|Deferred tax liabilities: |                                                                 |                                |                            |         |         |       |   |        
|                          | Intangible assets                                               |                                | $                          | (13,221 | )       |       | $ | (16,759 | )      
|                          | Items eliminated in purchase accounting                         |                                |                            | (184    | )       |       |   | (8,672  | )      
|                          | Other, including individually immaterial items                  |                                |                            | (5,386  | )       |       |   | (2,676  | )      
|                          |                                                                 |                                |                            |         |         |      
|                          |                                                                 | Total deferred tax liabilities |                            |         | (18,791 | )     |   |         | (28,107 | )     
|                          |                                                                 |                                |                            |         |         |      
|                          |                                                                 |                                | Net deferred tax assets(1) |         | $       | 2,771 |   |         | $       | 13,913 | 
|                          |                                                                 |                                |                            |         |         |      






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | At December 31, 2004, balance sheet classification
    includes: $8.3 million in current deferred tax assets,
    $2.1 million in long-term deferred tax assets and offset by
    $7.6 million of long-term deferred tax liabilities. At
    December 31, 2003, balance sheet classification includes:
    $0.3 million in current deferred tax assets,
    $18.0 million in long-term deferred tax assets and offset
    by $4.3 million of current deferred tax liabilities
    included in accrued expenses and other liabilities.





101



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)








|    |                                              
|--- | ---------------------------------------------
|13. | Financial, Segment and Geographic Information

Financial.


Segment.


|                                  |                        |                         |         |         |      |   |         |         |  |   |         |         | 
|--------------------------------- | ---------------------- | ----------------------- | ------- | ------- | ---- | - | ------- | ------- |  | - | ------- | ------- | 
|                                  |                        | Year Ended December 31, |        
|                                  |                        |                         |        
|                                  |                        | 2004                    |         |         | 2003 |   |         | 2002    | 
|                                  |                        |                         |         |         |      |   |         |         | 
|Business Intelligence Platform(1) |                        | $                       | 427,181 |         |      | $ | 235,539 |         |  | $ | 219,195 |        
|Enterprise Analytic Applications  |                        |                         | 28,026  |         |      |   | 25,754  |         |  |   | 20,899  |        
|Data Integration                  |                        |                         | 18,166  |         |      |   | 13,968  |         |  |   | 3,861   |        
|                                  |                        |                         |         |         |      |   |         |         | 
|                                  | Total net license fees |                         | $       | 473,373 |      |   | $       | 275,261 |  |   | $       | 243,955 | 
|                                  |                        |                         |         |         |      |   |         |         | 






|    |                                                                                                   
|--- | --------------------------------------------------------------------------------------------------
|(1) | Includes Crystal Decisions products for 2004 and from
    December 12, 2003 to December 31, 2003.

102



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)


Geography.


|          |                                              |                         |   |         |         |  |   |         |         |  |   |         |         | 
|--------- | -------------------------------------------- | ----------------------- | - | ------- | ------- |  | - | ------- | ------- |  | - | ------- | ------- | 
|          |                                              | Year Ended December 31, |  
|          |                                              |                         |  
|          |                                              | 2004                    |   |         | 2003    |  |   | 2002    |        
|          |                                              |                         |   |         |         |  |   |         |        
|Revenues: |                                              |                         |   |         |         |  |   |         |         |  |   |        
|          | France                                       |                         | $ | 85,942  |         |  | $ | 72,088  |         |  | $ | 53,752  |        
|          | Americas, including Canada and Latin America |                         |   | 453,292 |         |  |   | 241,911 |         |  |   | 212,874 |        
|          | Rest of Europe, Middle East and Africa       |                         |   | 311,746 |         |  |   | 201,627 |         |  |   | 158,628 |        
|          | Asia Pacific, including Japan                |                         |   | 74,651  |         |  |   | 45,199  |         |  |   | 29,545  |        
|          |                                              |                         |   |         |         |  |   |         |        
|          |                                              | Total revenues          |   | $       | 925,631 |  |   | $       | 560,825 |  |   | $       | 454,799 | 
|          |                                              |                         |   |         |         |  |   |         |        



|                   |                                              |                         |   |           |           |  |   |           |           | 
|------------------ | -------------------------------------------- | ----------------------- | - | --------- | --------- |  | - | --------- | --------- | 
|                   |                                              | December 31,            |  
|                   |                                              |                         |  
|                   |                                              | 2004                    |   |           | 2003      | 
|                   |                                              |                         |   |           |           | 
|Long-lived assets: |                                              |                         |   |           |           |  |   |          
|                   | France                                       |                         | $ | 53,394    |           |  | $ | 24,336    |          
|                   | Americas, including Canada and Latin America |                         |   | 1,148,410 |           |  |   | 1,145,449 |          
|                   | Rest of Europe, Middle East and Africa       |                         |   | 99,433    |           |  |   | 122,624   |          
|                   | Asia Pacific, including Japan                |                         |   | 6,472     |           |  |   | 6,087     |          
|                   |                                              |                         |   |           |           | 
|                   |                                              | Total long-lived assets |   | $         | 1,307,709 |  |   | $         | 1,298,496 | 
|                   |                                              |                         |   |           |           | 



|    |                               
|--- | ------------------------------
|14. | Business Restructuring Charges



| |                                              
| | ---------------------------------------------
| | Acquisition-related Restructuring Liabilities



| |                              
| | -----------------------------
| | Crystal Decisions Acquisition





| |                                                                             
| | ----------------------------------------------------------------------------
| | Restructuring Costs Expensed Related to Pre-acquisition
    Business Objects





103



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






|                                                                                            |  |               |        |   |            |   |       |       |  |   |        |  
|------------------------------------------------------------------------------------------- |  | ------------- | ------ | - | ---------- | - | ----- | ----- |  | - | ------ | -
|                                                                                            |  | Employee      |        |   |            |   |      
|                                                                                            |  | Severance and |        |   | Cost to    |   |       |      
|                                                                                            |  | Other Related |        |   | Abandon    |   |       |      
|                                                                                            |  | Benefits      |        |   | Facilities |   |       | Total | 
|                                                                                            |  |               |        |   |            |   |       |       | 
|Restructuring charges at December 2003                                                      |  | $             | 7,782  |   |            | $ |      |       |  | $ | 7,782  |  
|Non-cash charges                                                                            |  |               | (332   | ) |            |   |      |       |  |   | (332   | )
|Impact of foreign currency exchange rates on translation of
    accrual                     |  |               | 302    |   |            |   |      |       |  |   | 302    |  
|                                                                                            |  |               |        |   |            |   |       |       | 
|Balance at December 31, 2003                                                                |  | $             | 7,752  |   |            | $ |      |       |  | $ | 7,752  |  
|                                                                                            |  |               |        |   |            |   |       |       | 
|Adjustment to restructuring charges accrued during 2004 included
    as restructuring costs |  |               | (85    | ) |            |   | 2,254 |       |  |   | 2,169  |  
|Cash payments during 2004                                                                   |  |               | (6,970 | ) |            |   | (849  | )     |  |   | (7,819 | )
|Impact of foreign currency exchange rates on translation of
    accrual                     |  |               | 166    |   |            |   | (44   | )     |  |   | 122    |  
|                                                                                            |  |               |        |   |            |   |       |       | 
|Balance at December 31, 2004                                                                |  | $             | 863    |   |            | $ | 1,361 |       |  | $ | 2,224  |  
|                                                                                            |  |               |        |   |            |   |       |       | 



| |                                                                                
| | -------------------------------------------------------------------------------
| | Restructuring Costs Included as a Cost of the Crystal
    Decisions Acquisition







104



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|                                                                        |  |               |        |   |            |   |        |       |  |   |         |  
|----------------------------------------------------------------------- |  | ------------- | ------ | - | ---------- | - | ------ | ----- |  | - | ------- | -
|                                                                        |  | Employee      |        |   |            |   |       
|                                                                        |  | Severance and |        |   | Cost to    |   |        |      
|                                                                        |  | Other Related |        |   | Abandon    |   |        |      
|                                                                        |  | Benefits      |        |   | Facilities |   |        | Total | 
|                                                                        |  |               |        |   |            |   |        |       | 
|Restructuring charge at December 2003                                   |  | $             | 10,780 |   |            | $ | 2,745  |       |  | $ | 13,525  |  
|Cash payments during 2003                                               |  |               | (1,136 | ) |            |   |       |       |  |   | (1,136  | )
|                                                                        |  |               |        |   |            |   |        |       | 
|Balance at December 31, 2003                                            |  | $             | 9,644  |   |            | $ | 2,745  |       |  | $ | 12,389  |  
|                                                                        |  |               |        |   |            |   |        |       | 
|Cash payments during 2004                                               |  |               | (8,960 | ) |            |   | (1,646 | )     |  |   | (10,606 | )
|Adjustments to the original plan                                        |  |               | (598   | ) |            |   | (454   | )     |  |   | (1,052  | )
|Impact of foreign currency exchange rates on translation of
    accrual |  |               | 48     |   |            |   | 115    |       |  |   | 163     |  
|                                                                        |  |               |        |   |            |   |        |       | 
|Balance at December 31, 2004                                            |  | $             | 134    |   |            | $ | 760    |       |  | $ | 894     |  
|                                                                        |  |               |        |   |            |   |        |       | 



| |                                  
| | ---------------------------------
| | Acta Technology, Inc. Acquisition







105



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|                                                                                  |  |               |        |       |                 |   |        |       |  |   |        |  
|--------------------------------------------------------------------------------- |  | ------------- | ------ | ----- | --------------- | - | ------ | ----- |  | - | ------ | -
|                                                                                  |  |               |        | Lease |                 |   |       
|                                                                                  |  | Employee      |        |       | Abandonment     |   |        |      
|                                                                                  |  | Severance and |        |       | and Write-off   |   |        |      
|                                                                                  |  | Other Related |        |       | of Property and |   |        |      
|                                                                                  |  | Benefits      |        |       | Equipment       |   |        | Total | 
|                                                                                  |  |               |        |       |                 |   |        |       | 
|Restructuring charge at August 2002                                               |  | $             | 4,381  |       |                 | $ | 9,146  |       |  | $ | 13,527 |  
|Cash payments during 2002                                                         |  |               | (4,381 | )     |                 |   | (1,108 | )     |  |   | (5,489 | )
|Non-cash charges                                                                  |  |               |       |       |                 |   | (1,220 | )     |  |   | (1,220 | )
|                                                                                  |  |               |        |       |                 |   |        |       | 
|Balance at December 31, 2002                                                      |  | $             |       |       |                 | $ | 6,818  |       |  | $ | 6,818  |  
|                                                                                  |  |               |        |       |                 |   |        |       | 
|Net cash payments during 2003                                                     |  |               |       |       |                 |   | (3,400 | )     |  |   | (3,400 | )
|Reversal of excess U.S. facilities shutdown accrual
    adjusted through goodwill |  |               |       |       |                 |   | (2,741 | )     |  |   | (2,741 | )
|                                                                                  |  |               |        |       |                 |   |        |       | 
|Balance at December 31, 2003                                                      |  | $             |       |       |                 | $ | 677    |       |  | $ | 677    |  
|                                                                                  |  |               |        |       |                 |   |        |       | 
|Cash payments during 2004                                                         |  |               |       |       |                 |   | (391   | )     |  |   | (391   | )
|Impact of foreign currency exchange rates on translation of
    accrual           |  |               |       |       |                 |   | 38     |       |  |   | 38     |  
|                                                                                  |  |               |        |       |                 |   |        |       | 
|Balance at December 31, 2004                                                      |  | $             |       |       |                 | $ | 324    |       |  | $ | 324    |  
|                                                                                  |  |               |        |       |                 |   |        |       | 



|    |                                    
|--- | -----------------------------------
|15. | Escrows Payable and Restricted Cash



|                                                                                                                                                             |  |                 |       |  |                 |   |       |      |  |   |        |  |  |   |        | 
|------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | --------------- | ----- |  | --------------- | - | ----- | ---- |  | - | ------ |  |  | - | ------ | 
|                                                                                                                                                             |  | December 31,    |      
|                                                                                                                                                             |  |                 |      
|                                                                                                                                                             |  | Escrows Payable |       |  | Restricted Cash |  
|                                                                                                                                                             |  |                 |       |  |                 |  
|                                                                                                                                                             |  | 2004            |       |  | 2003            |   |       | 2004 |  |   | 2003   | 
|                                                                                                                                                             |  |                 |       |  |                 |   |       |      |  |   |        | 
|Non-interest bearing notes issued in connection with the
    purchase of Acta, subject to indemnification obligations                                        |  | $               | 6,379 |  |                 | $ | 9,310 |      |  | $ | 6,379  |  |  | $ | 9,310  | 
|Bonuses to former Acta employees, subject to indemnification
    obligations                                                                                 |  |                 | 275   |  |                 |   | 418   |      |  |   | 275    |  |  |   | 418    | 
|Cash subject to withdrawal restrictions related to overdraft
    credit facility and foreign exchange forward trading line                                   |  |                 |      |  |                 |   |      |      |  |   |       |  |  |   | 2,035  | 
|Cash subject to withdrawal restrictions on deposit of security
    for bonuses to be paid to Acta employees, subject to employment
    related contingencies |  |                 |      |  |                 |   |      |      |  |   | 353    |  |  |   | 526    | 
|Cash subject to withdrawal restrictions on deposit                                                                                                           |  |                 |      |  |                 |   |      |      |  |   | 7,036  |  |  |   | 6,954  | 
|                                                                                                                                                             |  |                 |       |  |                 |   |       |      |  |   |        | 
|Total balances  current                                                                                                                                     |  | $               | 6,654 |  |                 | $ | 9,728 |      |  | $ | 14,043 |  |  | $ | 19,243 | 
|                                                                                                                                                             |  |                 |       |  |                 |   |       |      |  |   |        | 



106



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)








|    |                 
|--- | ----------------
|16. | Credit Agreement

   


 




|    |                                            
|--- | -------------------------------------------
|17. | Accounting for and Disclosure of Guarantees

Guarantors Accounting for Guarantees.


107



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)






Product Warranties.


Environmental Liabilities. Accounting for Asset Retirement
Obligations


Other Liabilities and Other Claims.


108



---



##### Table of Contents



Business Objects S.A.


Notes to Consolidated Financial
Statements  (Continued)




|    |                                                                             
|--- | ----------------------------------------------------------------------------
|18. | Supplemental Financial Information (Unaudited) 
    Selected Quarterly Data



|                                              |  |                                       |         |  |          |   |         |          |  |   |          |  |  |          |         |  |          |   |         |          |  |   |          |  |  |   |         |  |  |   |         | 
|--------------------------------------------- |  | ------------------------------------- | ------- |  | -------- | - | ------- | -------- |  | - | -------- |  |  | -------- | ------- |  | -------- | - | ------- | -------- |  | - | -------- |  |  | - | ------- |  |  | - | ------- | 
|                                              |  | Three Months Ended                    |        
|                                              |  |                                       |        
|                                              |  | Dec. 31,                              |         |  | Sept 30, |   |         | June 30, |  |   | Mar. 31, |  |  | Dec. 31, |         |  | Sept 30, |   |         | June 30, |  |   | Mar. 31, | 
|                                              |  | 2004(1)                               |         |  | 2004(1)  |   |         | 2004(1)  |  |   | 2004(1)  |  |  | 2003(2)  |         |  | 2003     |   |         | 2003     |  |   | 2003     | 
|                                              |  |                                       |         |  |          |   |         |          |  |   |          |  |  |          |         |  |          |   |         |          |  |   |          | 
|                                              |  | (In thousands, except per share data) |        
|Total revenues                                |  | $                                     | 266,688 |  |          | $ | 219,470 |          |  | $ | 222,238  |  |  | $        | 217,235 |  |          | $ | 184,203 |          |  | $ | 129,112  |  |  | $ | 128,987 |  |  | $ | 118,523 | 
|Gross margin                                  |  |                                       | 212,597 |  |          |   | 169,883 |          |  |   | 174,823  |  |  |          | 167,923 |  |          |   | 154,388 |          |  |   | 106,422  |  |  |   | 107,423 |  |  |   | 97,636  | 
|Acquired in-process technology                |  |                                       |        |  |          |   |        |          |  |   |         |  |  |          |        |  |          |   | 27,966  |          |  |   |         |  |  |   |        |  |  |   |        | 
|Restructuring costs                           |  |                                       | 677     |  |          |   |        |          |  |   | 1,492    |  |  |          |        |  |          |   | 7,782   |          |  |   |         |  |  |   |        |  |  |   |        | 
|Income from operations                        |  |                                       | 37,505  |  |          |   | 16,635  |          |  |   | 18,285   |  |  |          | 9,327   |  |          |   | 329     |          |  |   | 13,418   |  |  |   | 14,984  |  |  |   | 10,466  | 
|Net income (loss)                             |  | $                                     | 21,346  |  |          | $ | 11,029  |          |  | $ | 11,488   |  |  | $        | 3,260   |  |          | $ | (8,604  | )        |  | $ | 10,827   |  |  | $ | 11,527  |  |  | $ | 8,812   | 
|                                              |  |                                       |         |  |          |   |         |          |  |   |          |  |  |          |         |  |          |   |         |          |  |   |          | 
|Net income (loss) per share and ADS  basic   |  | $                                     | 0.24    |  |          | $ | 0.12    |          |  | $ | 0.13     |  |  | $        | 0.04    |  |          | $ | (0.12   | )        |  | $ | 0.17     |  |  | $ | 0.18    |  |  | $ | 0.14    | 
|                                              |  |                                       |         |  |          |   |         |          |  |   |          |  |  |          |         |  |          |   |         |          |  |   |          | 
|Net income (loss) per share and ADS  diluted |  | $                                     | 0.24    |  |          | $ | 0.12    |          |  | $ | 0.13     |  |  | $        | 0.04    |  |          | $ | (0.12   | )        |  | $ | 0.17     |  |  | $ | 0.18    |  |  | $ | 0.14    | 
|                                              |  |                                       |         |  |          |   |         |          |  |   |          |  |  |          |         |  |          |   |         |          |  |   |          | 






|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(1) | The three-month periods ended in 2004, include amortization of
    intangible assets related to the Crystal Decisions Acquisition
    of $27.1 million for the year, or approximately
    $6.8 million per quarter. In addition, approximately
    $6.7 million of stock-based compensation expense was
    recorded in 2004 related to unearned compensation realized in
    the year.                                                                                                                      
|   
|(2) | The three-months ended December 31, 2003 includes the
    consolidated results of operations for Crystal Decisions from
    December 12, 2003 to December 31, 2003. In accordance
    with FAS 141, the acquired in-process technology of
    $28.0 million relating to the Crystal Decisions Acquisition
    was written off in the three months ended December 31,
    2003. Restructuring costs of $7.8 million were incurred by
    Business Objects during the three months ended December 31,
    2003.

109



---



##### Table of Contents








|        |                                                                                         
|------- | ----------------------------------------------------------------------------------------
|Item 9. | Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure








|         |                        
|-------- | -----------------------
|Item 9A. | Controls and Procedures

Evaluation of Disclosure Controls and Procedures




Managements Report on Internal Control Over Financial
Reporting






Internal Control  Integrated
Framework.






Changes in Internal Control over Financial Reporting









|         |                  
|-------- | -----------------
|Item 9B. | Other Information



110



---



##### Table of Contents






PART III







|         |                                                   
|-------- | --------------------------------------------------
|Item 10. | Directors and Executive Officers of the Registrant







www.businessobjects.com www.businessobjects.com







|         |                       
|-------- | ----------------------
|Item 11. | Executive Compensation








|         |                                                                                                   
|-------- | --------------------------------------------------------------------------------------------------
|Item 12. | Security Ownership of Certain Beneficial Owners and
    Management and Related Stockholder Matters








|         |                                               
|-------- | ----------------------------------------------
|Item 13. | Certain Relationships and Related Transactions








|         |                                       
|-------- | --------------------------------------
|Item 14. | Principal Accountant Fees and Services



111



---



##### Table of Contents






PART IV







|         |                                            
|-------- | -------------------------------------------
|Item 15. | Exhibits and Financial Statement Schedules.

Consolidated Financial Statements




|                                                                                                         |  |      |    | 
|-------------------------------------------------------------------------------------------------------- |  | ---- | -- | 
|                                                                                                         |  | Page |   
|                                                                                                         |  |      |   
|Reports of Independent Registered Public Accounting Firm                                                 |  |      | 65 | 
|Consolidated Balance Sheets as of December 31, 2004 and 2003                                             |  |      | 67 | 
|Consolidated Statements of Income for the Years Ended
    December 31, 2004, 2003 and 2002               |  |      | 68 | 
|Consolidated Statements of Shareholders Equity for the
    Years Ended December 31, 2004, 2003 and 2002 |  |      | 69 | 
|Consolidated Statements of Cash Flow for the Years Ended
    December 31, 2004, 2003 and 2002            |  |      | 70 | 
|Notes to Consolidated Financial Statements                                                               |  |      | 71 | 

Financial Statement Schedules


Schedule II: Valuation and Qualifying
Accounts  Business Objects S.A.


|                                                           |  |                         |        |   |      |   |       |      |  |   |        |  
|---------------------------------------------------------- |  | ----------------------- | ------ | - | ---- | - | ----- | ---- |  | - | ------ | -
|                                                           |  | Year Ended December 31, |       
|                                                           |  |                         |       
|                                                           |  | 2004                    |        |   | 2003 |   |       | 2002 | 
|                                                           |  |                         |        |   |      |   |       |      | 
|Allowance for doubtful accounts and distribution reserves: |  |                         |        |   |      |   |       |      |  |   |        |  
|Balance at beginning of year                               |  | $                       | 9,847  |   |      | $ | 2,891 |      |  | $ | 3,861  |  
|Acquired through acquisition                               |  |                         | 0      |   |      |   | 6,628 |      |  |   | 537    |  
|Charged to costs and expenses                              |  |                         | 5,352  |   |      |   | 1,102 |      |  |   | (1,102 | )
|Deductions and write-offs                                  |  |                         | (3,051 | ) |      |   | (638  | )    |  |   | (585   | )
|Translation adjustments                                    |  |                         | 387    |   |      |   | (136  | )    |  |   | 180    |  
|                                                           |  |                         |        |   |      |   |       |      | 
|Balance at end of year                                     |  | $                       | 12,535 |   |      | $ | 9,847 |      |  | $ | 2,891  |  
|                                                           |  |                         |        |   |      |   |       |      | 

|                                         |  |                         |        |   |      |   |         |      |  |   |        |  
|---------------------------------------- |  | ----------------------- | ------ | - | ---- | - | ------- | ---- |  | - | ------ | -
|                                         |  | Year Ended December 31, |       
|                                         |  |                         |       
|                                         |  | 2004                    |        |   | 2003 |   |         | 2002 | 
|                                         |  |                         |        |   |      |   |         |      | 
|Deferred Tax Asset, Valuation Allowance  |  |                         |        |   |      |   |         |      |  |   |        |  
|Balance at beginning of year             |  | $                       | 49,265 |   |      | $ | 54,615  |      |  | $ | 26,302 |  
|Additions charged to valuation allowance |  |                         | 17,576 |   |      |   | 7,573   |      |  |   | 31,139 |  
|Reductions from valuation allowance      |  |                         | (6,847 | ) |      |   | (12,923 | )    |  |   | (2,826 | )
|                                         |  |                         |        |   |      |   |         |      | 
|Balance at end of year                   |  | $                       | 59,994 |   |      | $ | 49,265  |      |  | $ | 54,615 |  
|                                         |  |                         |        |   |      |   |         |      | 



112



---



##### Table of Contents



Exhibits.




|            |         |             |  |                                                                                                                                                                                                                                    
|----------- | ------- | ----------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |         | Description
|            |         |            
|            | 10.24   |             |  | French Employee Savings Plan, as amended December 16, 2004.                                                                                                                                                                        
|            | 10.25.1 |             |  | 2001 Stock Incentive Plan, as amended and approved June 10,
    2004 (English Translation).                                                                                                                                        
|            | 10.25.2 |             |  | 2001 Stock Incentive Plan, as amended August 20, 2004
    (English Translation).                                                                                                                                                   
|            | 10.25.3 |             |  | 2001 Subsidiary Stock Incentive Sub-Plan effective June 10,
    2004.                                                                                                                                                              
|            | 10.62   |             |  | 2005 Executive Compensation Plan.                                                                                                                                                                                                  
|            | 21.1    |             |  | List of Subsidiaries of the Company.                                                                                                                                                                                               
|            | 23.1    |             |  | Consent of Independent Registered Public Accounting Firm.                                                                                                                                                                          
|            | 24.1    |             |  | Power of Attorney is herein referenced to the signature page of
    this Annual Report on Form 10-K.                                                                                                                               
|            | 31.1    |             |  | Certification of Chief Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                            
|            | 31.2    |             |  | Certification of Chief Financial Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                            
|            | 32.1    |             |  | Certification of Chief Executive Officer and of Chief Financial
    Officer furnished pursuant to Rule 13a-14(b) of the Exchange Act
    and Section 1350 of Chapter 63 of Title 18 of the
    United States Code (18 U.S.C. 1350).

Exhibits Incorporated by Reference


|        |        |             |  |                                                                                                                                                                                                                                                                                                                                                                                                                                   
|------- | ------ | ----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |        |            
|Number  |        | Description
|        |        |            
|        | 3.1*   |             |  | Amended and Restated Bylaws of Business Objects S.A., as amended
    January 25, 2005 (English translation) is incorporated
    herein by reference to Exhibit 3.1 filed with our Current
    Report on Form 8-K filed with the SEC on January 28, 2005
    (File No. 000-24720).                                                                                                                                                 
|        | 4.1*   |             |  | Form of Deposit Agreement, as amended and restated on
    October 15, 2003, by and among Business Objects S.A. and
    The Bank of New York, as Depositary and holder from time to time
    of ADSs issued thereunder and Exhibit A to the Deposit
    Agreement, is incorporated herein by reference to Exhibit 1
    of our Registration Statement on Form F-6 filed with the
    SEC on October 15, 2003 (File No. 333-109712).
|        | 4.2*   |             |  | Amended and Restated Stockholders Agreement, dated as of
    October 15, 2003, by and among Business Objects S.A., New
    SAC, CB Cayman and certain shareholders of New SAC, is
    incorporated herein by reference to Exhibit 2.1 of our
    Current Report on Form 8-K filed with the SEC on
    October 17, 2003 (File No. 000-24720)).                                                                                     
|        | 10.3* |             |  | 1991 Stock Option Plan is incorporated herein by reference to
    Exhibit 10.2 filed with our Registration Statement on
    Form F-1 filed with the SEC on September 20, 1994
    (File No. 33-83052).                                                                                                                                                                                                                            
|        | 10.4* |             |  | 1993 Stock Option Plan is incorporated herein by reference to
    Exhibit 10.3 filed with our Registration Statement on
    Form F-1 filed with the SEC on September 20, 1994
    (File No. 33-83052).                                                                                                                                                                                                                            
|        | 10.5* |             |  | 1994 Stock Option Plan is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form F-1 filed with the SEC on September 20, 1994
    (File No. 33-83052).                                                                                                                                                                                                                             
|        | 10.6*  |             |  | Summary, in English, of 1992 Grant by the French Ministry of the
    Economy, Finance and the Budget is incorporated herein by
    reference to Exhibit 10.4 filed with our Registration
    Statement on Form F-1 filed with the SEC on
    September 20, 1994 (File No. 33-83052).                                                                                                                                              
|        | 10.21* |             |  | Commercial Lease by and between SCI De LIlot 4.3 and SCI
    Du Pont De Levallois (lessors) and the Company (lessee) dated
    December 22, 1999 (English translation) is incorporated
    herein by reference to Exhibit 10.24 filed with our Annual
    Report on Form 10-K filed with the SEC on March 30, 2000.                                                                                                              
|        | 10.22* |             |  | Lease agreement by and between 475 Java Drive Associates, L.P.
    and Business Objects Americas dated August 3, 2000 is
    incorporated herein by reference to Exhibit 10 filed with
    our Quarterly Report on Form 10-Q filed with the SEC on
    August 9, 2000.                                                                                                                                                            

113



---



##### Table of Contents



|        |           |  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------- | --------- |  | ----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |           |  |            
|Number  |           |  | Description
|        |           |  |            
|        | 10.23*   |  |             | 1999 Stock Option Plan, as amended, is incorporated herein by
    reference to Exhibit (d)(1) of our Schedule TO-I filed with
    the SEC on October 11, 2002 (File No. 005-47622).                                                                                                                                                                                                                                                             
|        | 10.24.1* |  |             | 1995 International Employee Stock Purchase Plan, as amended, is
    incorporated herein by reference to Exhibit 10.24.2 filed
    with our Current Report on Form 8-K filed with the SEC on
    October 26, 2004.                                                                                                                                                                                                                               
|        | 10.25*   |  |             | 2001 Stock Option Plan, as amended December 11, 2003, is
    incorporated herein by reference to Exhibit 10.25.1 filed
    with our Annual Report on Form 10-K filed with the SEC on
    March 12, 2004.                                                                                                                                                                                                                                        
|        | 10.26*   |  |             | Stock subscription warrant for John Olsen dated February 7,
    2001, is incorporated herein by reference to Exhibit 4.2
    filed with our Registration Statement on Form S-8 filed
    with the SEC on September 14, 2001.                                                                                                                                                                                                                    
|        | 10.27*   |  |             | Stock subscription warrant for Bernard Charlès dated
    October 30, 2001, is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form S-8 filed with the SEC on November 8, 2002 (File
    No. 333-101104).                                                                                                                                                                                       
|        | 10.28*   |  |             | Stock subscription warrant for Albert Eisenstat dated
    October 30, 2001, is incorporated herein by reference to
    Exhibit 4.3 filed with our Registration Statement on
    Form S-8 filed with the SEC on November 8, 2002 (File
    No. 333-101104).                                                                                                                                                                                      
|        | 10.29*   |  |             | Stock subscription warrant for Arnold Silverman dated
    October 30, 2001, is incorporated herein by reference to
    Exhibit 4.4 filed with our Registration Statement on
    Form S-8 filed with the SEC on November 8, 2002 (File
    No. 333-101104).                                                                                                                                                                                      
|        | 10.30*   |  |             | Agreement with each of the Companys directors and senior
    management pursuant to which the Company agreed to contract for
    and maintain liability insurance against liabilities which may
    be incurred by such persons in their respective capacities is
    incorporated herein by reference to Exhibit 10.5 filed with
    our Registration Statement on Form F-1 filed with the SEC
    on September 20, 1994 (File No. 333-83052).
|        | 10.31*    |  |             | Lease agreement by and between Commercial Union Life Assurance
    Company Limited, Business Objects UK Limited and Business
    Objects SA dated April 3, 2001 is incorporated herein by
    reference to Exhibit 99_3(ii) filed with our Quarterly
    Report on Form 10-Q filed with the SEC on November 14, 2001.                                                                                                                           
|        | 10.32*   |  |             | Stock subscription warrant for Gerald Held dated
    September 16, 2003, is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form S-8 filed with the SEC on September 30, 2003
    (File No. 333-109278).                                                                                                                                                                                       
|        | 10.33*   |  |             | Stock subscription warrant for Jean-François Heitz dated
    September 16, 2003, is incorporated herein by reference to
    Exhibit 4.3 filed with our Registration Statement on
    Form S-8 filed with the SEC on September 30, 2003
    (File No. 333-109278).                                                                                                                                                                               
|        | 10.34*   |  |             | Stock subscription warrant for David Peterschmidt dated
    September 16, 2003, is incorporated herein by reference to
    Exhibit 4.4 filed with our Registration Statement on
    Form S-8 filed with the SEC on September 30, 2003
    (File No. 333-109278).                                                                                                                                                                                
|        | 10.35*    |  |             | Agreement between Société Générale and
    Business Objects S.A. for a line of credit effective
    December 8, 2004 is incorporated herein by reference to
    Exhibit 10.35 filed with our Current Report on Form 8-K
    filed with the SEC on December 13, 2004.                                                                                                                                                                            
|        | 10.36*   |  |             | Crystal Decisions, Inc. 1999 Stock Option Plan, as amended
    August 13, 2003, is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form S-8 filed with the SEC on December 11, 2003 (File
    No. 333-111090).                                                                                                                                                                                 
|        | 10.36.1* |  |             | Crystal Decisions 1999 Stock Option Plan  Canadian
    Stock Option Agreement is incorporated herein by reference to
    Exhibit 10.1.1 filed with the Crystal Decisions
    Registration Statement on Form 10 filed with the SEC on
    October 27, 2000 (File No. 000-31859).                                                                                                                                                                
|        | 10.36.2* |  |             | Crystal Decisions 1999 Stock Option Plan  as amended
    August 13, 2001 (French Employees Only) is incorporated
    herein by reference to Exhibit 10.1.4 filed with the
    Crystal Decisions Annual Report on Form 10-K filed with the SEC
    on September 26, 2002.                                                                                                                                                                       

114



---



##### Table of Contents



|        |          |  |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------- | -------- |  | ----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |          |  |            
|Number  |          |  | Description
|        |          |  |            
|        | 10.37*   |  |             | Shareholders Agreement, dated as of November 22, 2000, by
    and among New SAC, Silver Lake Technology Investors Cayman,
    L.P., Silver Lake Investors Cayman, L.P., Silver Lake Partners
    Cayman, L.P., SAC Investments, L.P., August Capital III,
    L.P., Chase Equity Associates, L.P., GS Capital
    Partners III, L.P., GS Capital Partners III Offshore,
    L.P., Goldman, Sachs & Co. Verwaltungs GmbH, Stone
    Street Fund 2000 L.P., Bridge Street Special Opportunities
    Fund 2000, L.P. Staenberg Venture Partners II, L.P.,
    Staenberg Seagate Partners, LLC, Integral Capital
    Partners V, L.P., Integral Capital Partners V Side Fund,
    L.P. and the individuals listed therein, is incorporated by
    reference to Exhibit 10.16 filed with Seagate Technology
    International LLCs Registration Statement on Form S-4
    filed with the SEC on April 20, 2001 (File
    No. 333-59328).
|        | 10.38*   |  |             | Management Shareholders Agreement, dated as of November 22,
    2000, by and among New SAC and the Management Shareholders
    listed therein is incorporated by reference to
    Exhibit 10.17 filed with the Seagate Technology
    International LLC Registration Statement on Form S-4 filed
    with the SEC on April 20, 2001 (File No. 333-59328).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        | 10.40*   |  |             | Lease Agreement, dated September 27, 1999, between
    Laurelton Investments Ltd., Seagate Software Information
    Management Group (Canada) Ltd. and Seagate Software, Inc.
    incorporated herein by reference to Exhibit 10.10 filed
    with the Crystal Decisions Registration Statement on Form 10
    filed with the SEC on October 27, 2000 (File No. 000-31859).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        | 10.40.1* |  |             | Amendment to Lease agreement, dated June 22, 2000, between
    Laurelton Investments Ltd., Seagate Software Information
    Management Group (Canada) Ltd. and Seagate Software, Inc. is
    incorporated herein by reference to Exhibit 10.10.1 filed
    with the Crystal Decisions Annual Report on Form 10-K filed with
    the SEC on September 27, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|        | 10.40.2* |  |             | Amended and Restated Lease Agreement, dated February 28,
    2002, between Laurelton Investments Ltd., Crystal Decision,
    Corp. and Crystal Decisions, Inc. is incorporated herein by
    reference to Exhibit 10.10.2 filed with the Crystal
    Decisions Annual Report on Form 10-K filed with the SEC on
    September 26, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | 10.44*   |  |             | Employment Agreement, dated as of September 25, 2002, by
    and between Crystal Decisions Inc. and Jonathan Judge is
    incorporated herein by reference to Exhibit 10.17 filed
    with the Crystal Decisions Quarterly Report on Form 10-Q filed
    with the SEC on November 12, 2002 (File No. 000-31859).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | 10.44.1* |  |             | Amendment No. 1 to Employment Agreement dated as of
    August 28, 2003 between Crystal Decisions, Inc., Seagate
    Software (Cayman) Holdings Corporation and Jonathan J. Judge is
    incorporated herein by reference to Exhibit 10.17.1 filed
    with the Crystal Decisions Registration Statement on
    Form S-1 filed with the SEC on September 3, 2003 (File
    No. 333-108479).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        | 10.47*  |  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and Anthony L. Wind is incorporated herein
    by reference to Exhibit 10.25 filed with the Crystal
    Decisions Registration Statement on S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        | 10.48*  |  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and William G. Gibson is incorporated
    herein by reference to Exhibit 10.26 filed with the Crystal
    Decisions Registration Statement on S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|        | 10.49*  |  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and Andrew L. Handford is incorporated
    herein by reference to Exhibit 10.27 filed with the Crystal
    Decisions Registration Statement on S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|        | 10.50*  |  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and Eric Patel is incorporated herein by
    reference to Exhibit 10.28 filed with the Crystal Decisions
    Registration Statement on Form S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        | 10.51*   |  |             | Pledge and Security Agreement dated April 28, 2004 between
    Business Objects Americas and Comerica Bank is incorporated by
    reference to Exhibit 10.51 of the Companys Form 10-Q
    filed with the SEC on August 9, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

115



---



##### Table of Contents



|        |          |  |             |                                                                                                                                                                                                                                                         
|------- | -------- |  | ----------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |          |  |            
|Number  |          |  | Description
|        |          |  |            
|        | 10.51.1* |  |             | First Amendment to Pledge and Security Agreement dated
    July 28, 2004 between Business Objects Americas and
    Comerica Bank is incorporated by reference to
    Exhibit 10.51.1 of the Companys Form 10-Q filed with
    the SEC on August 9, 2004
|        | 10.52*  |  |             | 2004 International Employee Stock Purchase Plan, as amended, is
    incorporated herein by reference to Exhibit 10.52 filed
    with our Current Report on Form 8-K filed with the SEC on
    October 26, 2004.                                         
|        | 10.53*  |  |             | Stock Subscription Warrant for David J. Roux is incorporated
    herein by reference to Exhibit 4.2 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    May 13, 2004 (File No. 333-115768).                                 
|        | 10.54*  |  |             | Stock Subscription Warrant for Arnold Silverman is incorporated
    herein by reference to Exhibit 4.2 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).                             
|        | 10.55*  |  |             | Stock Subscription Warrant for Albert Eisenstat is incorporated
    herein by reference to Exhibit 4.3 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).                             
|        | 10.56*  |  |             | Stock Subscription Warrant for Bernard Charlès is
    incorporated herein by reference to Exhibit 4.4 filed with
    our Registration Statement on Form S-8 filed with the SEC
    on June 25, 2004 (File No. 333-116869).                              
|        | 10.57*  |  |             | Stock Subscription Warrant for Kurt Lauk is incorporated herein
    by reference to Exhibit 4.5 filed with our Registration
    Statement on Form S-8 filed with the SEC on June 25,
    2004 (File No. 333-116869).                                    
|        | 10.58*  |  |             | Stock Subscription Warrant for Gerald Held is incorporated
    herein by reference to Exhibit 4.6 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).                                  
|        | 10.59*  |  |             | Stock Subscription Warrant for Jean-François Heitz is
    incorporated herein by reference to Exhibit 4.7 filed with
    our Registration Statement on Form S-8 filed with the SEC
    on June 25, 2004 (File No. 333-116869).                          
|        | 10.60*  |  |             | Stock Subscription Warrant for David Peterschmidt is
    incorporated herein by reference to Exhibit 4.8 filed with
    our Registration Statement on Form S-8 filed with the SEC
    on June 25, 2004 (File No. 333-116869).                           
|        | 10.61*  |  |             | Stock Subscription Warrant for David J. Roux is incorporated
    herein by reference to Exhibit 4.9 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).                                






|  |                  
|- | -----------------
|* | Previously filed.



|  |                                            
|- | -------------------------------------------
| | Management contracts or compensatory plans.

116



---



##### Table of Contents



SIGNATURES






| |                      
| | ---------------------
| | Business Objects S.A.



| |     |                     
| | --- | --------------------
| | By: | /s/ Bernard Liautaud

| |                          
| | -------------------------
| |                          
| | Bernard Liautaud         
| | Chairman of the Board and
| | Chief Executive Officer  







|                                                |  |                                                                                                          |  |                |  | 
|----------------------------------------------- |  | -------------------------------------------------------------------------------------------------------- |  | -------------- |  | 
|Signature                                       |  | Title                                                                                                    |  | Date          
|                                                |  |                                                                                                          |  |               
|                                               
|/s/ Bernard Liautaud
    Bernard Liautaud       |  | Chairman of the Board, Chief Executive Officer and Director
    (Principal Executive Officer)            |  | March 16, 2005
|                                               
|/s/ James R. Tolonen
    James R. Tolonen       |  | Chief Financial Officer and Senior Group Vice President
    (Principal Financial and Accounting Officer) |  | March 16, 2005
|                                               
|Arnold
    Silverman                            |  | Director                                                                                                 |  |               
|                                               
|/s/ Bernard Charlès
    Bernard Charlès         |  | Director                                                                                                 |  | March 16, 2005
|                                               
|/s/ Gerald Held
    Gerald Held                 |  | Director                                                                                                 |  | March 16, 2005
|                                               
|/s/ David Peterschmidt
    David Peterschmidt   |  | Director                                                                                                 |  | March 16, 2005
|                                               
|/s/ Jean-François Heitz
    Jean-François Heitz |  | Director                                                                                                 |  | March 16, 2005
|                                               
|/s/ David Roux
    David Roux                   |  | Director                                                                                                 |  | March 16, 2005

117



---



##### Table of Contents



|                                        |  |          |  |                |  | 
|--------------------------------------- |  | -------- |  | -------------- |  | 
|Signature                               |  | Title    |  | Date          
|                                        |  |          |  |               
|                                       
|/s/ Kurt Lauk
    Kurt Lauk             |  | Director |  | March 16, 2005
|                                       
|/s/ Carl Pascarella
    Carl Pascarella |  | Director |  | March 16, 2005

118



---



##### Table of Contents



EXHIBIT INDEX


|        |    |         |             |                                                                                                                                                                                                                                                                                                                                                                                                                                   
|------- | -- | ------- | ----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |         |            
|Number  |    |         | Description
|        |    |         |            
|        | 3  | .1*     |             | Amended and Restated Bylaws of Business Objects S.A., as amended
    January 25, 2005 (English translation) is incorporated
    herein by reference to Exhibit 3.1 filed with our Current
    Report on Form 8-K filed with the SEC on January 28, 2005
    (File No. 000-24720).                                                                                                                                                 
|        | 4  | .1*     |             | Form of Deposit Agreement, as amended and restated on
    October 15, 2003, by and among Business Objects S.A. and
    The Bank of New York, as Depositary and holder from time to time
    of ADSs issued thereunder and Exhibit A to the Deposit
    Agreement, is incorporated herein by reference to Exhibit 1
    of our Registration Statement on Form F-6 filed with the
    SEC on October 15, 2003 (File No. 333-109712).
|        | 4  | .2*     |             | Amended and Restated Stockholders Agreement, dated as of
    October 15, 2003, by and among Business Objects S.A., New
    SAC, CB Cayman and certain shareholders of New SAC, is
    incorporated herein by reference to Exhibit 2.1 of our
    Current Report on Form 8-K filed with the SEC on
    October 17, 2003 (File No. 000-24720).                                                                                      
|        | 10 | .3*+    |             | 1991 Stock Option Plan is incorporated herein by reference to
    Exhibit 10.2 filed with our Registration Statement on
    Form F-1 filed with the SEC on September 20, 1994
    (File No. 33-83052).                                                                                                                                                                                                                            
|        | 10 | .4*+    |             | 1993 Stock Option Plan is incorporated herein by reference to
    Exhibit 10.3 filed with our Registration Statement on
    Form F-1 filed with the SEC on September 20, 1994
    (File No. 33-83052).                                                                                                                                                                                                                            
|        | 10 | .5*+    |             | 1994 Stock Option Plan is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form F-1 filed with the SEC on September 20, 1994
    (File No. 33-83052).                                                                                                                                                                                                                             
|        | 10 | .6*     |             | Summary, in English, of 1992 Grant by the French Ministry of the
    Economy, Finance and the Budget is incorporated herein by
    reference to Exhibit 10.4 filed with our Registration
    Statement on Form F-1 filed with the SEC on
    September 20, 1994 (File No. 33-83052).                                                                                                                                              
|        | 10 | .21*    |             | Commercial Lease by and between SCI De LIlot 4.3 and SCI
    Du Pont De Levallois (lessors) and the Company (lessee) dated
    December 22, 1999 (English translation) is incorporated
    herein by reference to Exhibit 10.24 filed with our Annual
    Report on Form 10-K filed with the SEC on March 30, 2000.                                                                                                              
|        | 10 | .22*    |             | Lease agreement by and between 475 Java Drive Associates, L.P.
    and Business Objects Americas dated August 3, 2000 is
    incorporated herein by reference to Exhibit 10 filed with
    our Quarterly Report on Form 10-Q filed with the SEC on
    August 9, 2000.                                                                                                                                                            
|        | 10 | .23*+   |             | 1999 Stock Option Plan, as amended, is incorporated herein by
    reference to Exhibit (d)(1) of our Schedule TO-I filed with
    the SEC on October 11, 2002 (File No. 005-47622).                                                                                                                                                                                                                                               
|        | 10 | .24+    |             | French Employee Savings Plan, as amended, December 16, 2004.                                                                                                                                                                                                                                                                                                                                                                      
|        | 10 | .24.1*+ |             | 1995 International Employee Stock Purchase Plan, as amended, is
    incorporated herein by reference to Exhibit 10.24.2 filed
    with our Current Report on Form 8-K filed with the SEC on
    October 26, 2004.                                                                                                                                                                                                                 
|        | 10 | .25*+   |             | 2001 Stock Option Plan, as amended December 11, 2003, is
    incorporated herein by reference to Exhibit 10.25.1 filed
    with our Annual Report on Form 10-K filed with the SEC on
    March 12, 2004.                                                                                                                                                                                                                          
|        | 10 | .25.1+  |             | 2001 Stock Incentive Plan, as amended and approved June 10,
    2004 (English Translation).                                                                                                                                                                                                                                                                                                                                       
|        | 10 | .25.2+  |             | 2001 Stock Incentive Plan, as amended August 20, 2004
    (English Translation).                                                                                                                                                                                                                                                                                                                                                  
|        | 10 | .25.3+  |             | 2001 Subsidiary Stock Incentive Sub-Plan effective June 10,
    2004.                                                                                                                                                                                                                                                                                                                                                             
|        | 10 | .26*+   |             | Stock subscription warrant for John Olsen dated February 7,
    2001, is incorporated herein by reference to Exhibit 4.2
    filed with our Registration Statement on Form S-8 filed
    with the SEC on September 14, 2001.                                                                                                                                                                                                      
|        | 10 | .27*+   |             | Stock subscription warrant for Bernard Charlès dated
    October 30, 2001, is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form S-8 filed with the SEC on November 8, 2002 (File
    No. 333-101104).                                                                                                                                                                         



---



##### Table of Contents



|        |    |         |             |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------- | -- | ------- | ----------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |         |            
|Number  |    |         | Description
|        |    |         |            
|        | 10 | .28*+   |             | Stock subscription warrant for Albert Eisenstat dated
    October 30, 2001, is incorporated herein by reference to
    Exhibit 4.3 filed with our Registration Statement on
    Form S-8 filed with the SEC on November 8, 2002 (File
    No. 333-101104).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|        | 10 | .29*+   |             | Stock subscription warrant for Arnold Silverman dated
    October 30, 2001, is incorporated herein by reference to
    Exhibit 4.4 filed with our Registration Statement on
    Form S-8 filed with the SEC on November 8, 2002 (File
    No. 333-101104).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|        | 10 | .30*+   |             | Agreement with each of the Companys directors and senior
    management pursuant to which the Company agreed to contract for
    and maintain liability insurance against liabilities which may
    be incurred by such persons in their respective capacities is
    incorporated herein by reference to Exhibit 10.5 filed with
    our Registration Statement on Form F-1 filed with the SEC
    on September 20, 1994 (File No. 333-83052).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | 10 | .31*    |             | Lease agreement by and between Commercial Union Life Assurance
    Company Limited, Business Objects UK Limited and Business
    Objects SA dated April 3, 2001 is incorporated herein by
    reference to Exhibit 99_3(ii) filed with our Quarterly
    Report on Form 10-Q filed with the SEC on November 14, 2001.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|        | 10 | .32*+   |             | Stock subscription warrant for Gerald Held dated
    September 16, 2003, is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form S-8 filed with the SEC on September 30, 2003
    (File No. 333-109278).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        | 10 | .33*+   |             | Stock subscription warrant for Jean-François Heitz dated
    September 16, 2003, is incorporated herein by reference to
    Exhibit 4.3 filed with our Registration Statement on
    Form S-8 filed with the SEC on September 30, 2003
    (File No. 333-109278).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|        | 10 | .34*+   |             | Stock subscription warrant for David Peterschmidt dated
    September 16, 2003, is incorporated herein by reference to
    Exhibit 4.4 filed with our Registration Statement on
    Form S-8 filed with the SEC on September 30, 2003
    (File No. 333-109278).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | 10 | .35*    |             | Agreement between Société Générale and
    Business Objects S.A. for a line of credit effective
    December 8, 2004 is incorporated herein by reference to
    Exhibit 10.35 filed with our Current Report on Form 8-K
    filed with the SEC on December 13, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|        | 10 | .36*+   |             | Crystal Decisions, Inc. 1999 Stock Option Plan, as amended
    August 13, 2003, is incorporated herein by reference to
    Exhibit 4.2 filed with our Registration Statement on
    Form S-8 filed with the SEC on December 11, 2003 (File
    No. 333-111090).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|        | 10 | .36.1*+ |             | Crystal Decisions 1999 Stock Option Plan  Canadian
    Stock Option Agreement is incorporated herein by reference to
    Exhibit 10.1.1 filed with the Crystal Decisions
    Registration Statement on Form 10 filed with the SEC on
    October 27, 2000 (File No. 000-31859).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|        | 10 | .36.2*+ |             | Crystal Decisions 1999 Stock Option Plan  as amended
    August 13, 2001 (French Employees Only) is incorporated
    herein by reference to Exhibit 10.1.4 filed with the
    Crystal Decisions Annual Report on Form 10-K filed with the SEC
    on September 26, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        | 10 | .37*    |             | Shareholders Agreement, dated as of November 22, 2000, by
    and among New SAC, Silver Lake Technology Investors Cayman,
    L.P., Silver Lake Investors Cayman, L.P., Silver Lake Partners
    Cayman, L.P., SAC Investments, L.P., August Capital III,
    L.P., Chase Equity Associates, L.P., GS Capital
    Partners III, L.P., GS Capital Partners III Offshore,
    L.P., Goldman, Sachs & Co. Verwaltungs GmbH, Stone
    Street Fund 2000 L.P., Bridge Street Special Opportunities
    Fund 2000, L.P. Staenberg Venture Partners II, L.P.,
    Staenberg Seagate Partners, LLC, Integral Capital
    Partners V, L.P., Integral Capital Partners V Side Fund,
    L.P. and the individuals listed therein, is incorporated by
    reference to Exhibit 10.16 filed with Seagate Technology
    International LLCs Registration Statement on Form S-4
    filed with the SEC on April 20, 2001 (File
    No. 333-59328).
|        | 10 | .38*    |             | Management Shareholders Agreement, dated as of November 22,
    2000, by and among New SAC and the Management Shareholders
    listed therein is incorporated by reference to
    Exhibit 10.17 filed with the Seagate Technology
    International LLC Registration Statement on Form S-4 filed
    with the SEC on April 20, 2001 (File No. 333-59328).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           



---



##### Table of Contents



|        |    |        |             |                                                                                                                                                                                                                                                                                                                                                                                            
|------- | -- | ------ | ----------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |        |            
|Number  |    |        | Description
|        |    |        |            
|        | 10 | .40*   |             | Lease Agreement, dated September 27, 1999, between
    Laurelton Investments Ltd., Seagate Software Information
    Management Group (Canada) Ltd. and Seagate Software, Inc.
    incorporated herein by reference to Exhibit 10.10 filed
    with the Crystal Decisions Registration Statement on Form 10
    filed with the SEC on October 27, 2000 (File No. 000-31859).                
|        | 10 | .40.1* |             | Amendment to Lease agreement, dated June 22, 2000, between
    Laurelton Investments Ltd., Seagate Software Information
    Management Group (Canada) Ltd. and Seagate Software, Inc. is
    incorporated herein by reference to Exhibit 10.10.1 filed
    with the Crystal Decisions Annual Report on Form 10-K filed with
    the SEC on September 27, 2001.                             
|        | 10 | .40.2* |             | Amended and Restated Lease Agreement, dated February 28,
    2002, between Laurelton Investments Ltd., Crystal Decision,
    Corp. and Crystal Decisions, Inc. is incorporated herein by
    reference to Exhibit 10.10.2 filed with the Crystal
    Decisions Annual Report on Form 10-K filed with the SEC on
    September 26, 2002.                                                    
|        | 10 | .44*   |             | Employment Agreement, dated as of September 25, 2002, by
    and between Crystal Decisions Inc. and Jonathan Judge is
    incorporated herein by reference to Exhibit 10.17 filed
    with the Crystal Decisions Quarterly Report on Form 10-Q filed
    with the SEC on November 12, 2002 (File No. 000-31859).                                                                           
|        | 10 | .44.1* |             | Amendment No. 1 to Employment Agreement dated as of
    August 28, 2003 between Crystal Decisions, Inc., Seagate
    Software (Cayman) Holdings Corporation and Jonathan J. Judge is
    incorporated herein by reference to Exhibit 10.17.1 filed
    with the Crystal Decisions Registration Statement on
    Form S-1 filed with the SEC on September 3, 2003 (File
    No. 333-108479).
|        | 10 | .47*+  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and Anthony L. Wind is incorporated herein
    by reference to Exhibit 10.25 filed with the Crystal
    Decisions Registration Statement on S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                  
|        | 10 | .48*+  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and William G. Gibson is incorporated
    herein by reference to Exhibit 10.26 filed with the Crystal
    Decisions Registration Statement on S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                
|        | 10 | .49*+  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and Andrew L. Handford is incorporated
    herein by reference to Exhibit 10.27 filed with the Crystal
    Decisions Registration Statement on S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).               
|        | 10 | .50*+  |             | Management Retention Agreement dated as of September 16,
    2003 between Crystal Decisions, Inc., Seagate Software (Cayman)
    Holdings Corporation and Eric Patel is incorporated herein by
    reference to Exhibit 10.28 filed with the Crystal Decisions
    Registration Statement on Form S-1/A filed with the SEC on
    October 15, 2003 (File No. 333-108479).                  
|        | 10 | .51*   |             | Pledge and Security Agreement dated April 28, 2004 between
    Business Objects Americas and Comerica Bank is incorporated by
    reference to Exhibit 10.51 of the Companys Form 10-Q
    filed with the SEC on August 9, 2004.                                                                                                                                                          
|        | 10 | .51.1* |             | First Amendment to Pledge and Security Agreement dated
    July 28, 2004 between Business Objects Americas and
    Comerica Bank is incorporated by reference to
    Exhibit 10.51.1 of the Companys Form 10-Q filed
    with the SEC on August 9, 2004                                                                                                                                   
|        | 10 | .52*+  |             | 2004 International Employee Stock Purchase Plan, as amended, is
    incorporated herein by reference to Exhibit 10.52 filed
    with our Current Report on Form 8-K filed with the SEC on
    October 26, 2004.                                                                                                                                                                            
|        | 10 | .53*+  |             | Stock Subscription Warrant for David J. Roux is incorporated
    herein by reference to Exhibit 4.2 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    May 13, 2004 (File No. 333-115768).                                                                                                                                                                    
|        | 10 | .54*+  |             | Stock Subscription Warrant for Arnold Silverman is incorporated
    herein by reference to Exhibit 4.2 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).                                                                                                                                                                



---



##### Table of Contents



|        |    |       |             |                                                                                                                                                                                                                                    
|------- | -- | ----- | ----------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit |    |       |            
|Number  |    |       | Description
|        |    |       |            
|        | 10 | .55*+ |             | Stock Subscription Warrant for Albert Eisenstat is incorporated
    herein by reference to Exhibit 4.3 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).        
|        | 10 | .56*+ |             | Stock Subscription Warrant for Bernard Charlès is
    incorporated herein by reference to Exhibit 4.4 filed with
    our Registration Statement on Form S-8 filed with the SEC
    on June 25, 2004 (File No. 333-116869).         
|        | 10 | .57*+ |             | Stock Subscription Warrant for Kurt Lauk is incorporated herein
    by reference to Exhibit 4.5 filed with our Registration
    Statement on Form S-8 filed with the SEC on June 25,
    2004 (File No. 333-116869).               
|        | 10 | .58*+ |             | Stock Subscription Warrant for Gerald Held is incorporated
    herein by reference to Exhibit 4.6 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).             
|        | 10 | .59*+ |             | Stock Subscription Warrant for Jean-François Heitz is
    incorporated herein by reference to Exhibit 4.7 filed with
    our Registration Statement on Form S-8 filed with the SEC
    on June 25, 2004 (File No. 333-116869).     
|        | 10 | .60*+ |             | Stock Subscription Warrant for David Peterschmidt is
    incorporated herein by reference to Exhibit 4.8 filed with
    our Registration Statement on Form S-8 filed with the SEC
    on June 25, 2004 (File No. 333-116869).      
|        | 10 | .61*+ |             | Stock Subscription Warrant for David J. Roux is incorporated
    herein by reference to Exhibit 4.9 filed with our
    Registration Statement on Form S-8 filed with the SEC on
    June 25, 2004 (File No. 333-116869).           
|        | 10 | .62+  |             | 2005 Executive Compensation Plan.                                                                                                                                                                                                  
|        | 21 | .1    |             | List of Subsidiaries of the Company.                                                                                                                                                                                               
|        | 23 | .1    |             | Consent of Independent Registered Public Accounting Firm.                                                                                                                                                                          
|        | 24 | .1    |             | Power of Attorney is herein referenced to the signature page of
    this Annual Report on Form 10-K.                                                                                                                               
|        | 31 | .1    |             | Certification of Chief Executive Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                            
|        | 31 | .2    |             | Certification of Chief Financial Officer pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.                                                                                                                            
|        | 32 | .1    |             | Certification of Chief Executive Officer and of Chief Financial
    Officer furnished pursuant to Rule 13a-14(b) of the
    Exchange Act and Section 1350 of Chapter 63 of
    Title 18 of the United States Code (18 U.S.C. 1350).






|  |                                            
|- | -------------------------------------------
|* | Previously filed.                          
| 
|+ | Management contracts or compensatory plans.