Our operations are organized into five operating business groups in addition to our corporate and asset management activities, which collectively represent seven operating segments for internal and external reporting purposes. We measure performance using funds from operations (“FFO”) generated by each operating segment and the amount of capital invested by the Corporation in each segment using common equity by segment.

i.Asset Management business include managing our long-term private funds, perpetual strategies and liquid strategies on behalf of our investors and ourselves, as well as our share of the asset management activities of Oaktree Capital Management (“Oaktree”). We generate contractual base management fees for these activities as well as incentive distributions and performance income, including performance fees, transaction fees and carried interest.

ii.Corporate Activities include the investment of cash and financial assets, as well as the management of our corporate leverage, including corporate borrowings and preferred equity, which fund a portion of the capital invested in our other operations. Certain corporate costs such as technology and operations are incurred on behalf of our operating segments and allocated to each operating segment based on an internal pricing framework.

FFO is a key measure of our financial performance and our segment measure of profit and loss. It is utilized by our Chief Operating Decision Maker in assessing operating results and the performance of our businesses on a segmented basis. We define FFO as net income excluding fair value changes, depreciation and amortization and deferred income taxes, net of non-controlling interests. When determining FFO, we include our proportionate share of the FFO from equity accounted investments on a fully diluted basis. FFO also includes realized disposition gains and losses, which are gains or losses arising from transactions during the reporting period, adjusted to include associated fair value changes and revaluation surplus recorded in prior periods, taxes payable or receivable in connection with those transactions and amounts that are recorded directly in equity, such as ownership changes.

We use FFO to assess our performance as an asset manager and as an investor in our assets. FFO from our Asset Management segment includes fees, net of the associated costs, that we earn from managing capital in our perpetual affiliates, private funds and liquid strategies accounts. We are also eligible to earn incentive payments in the form of incentive distributions, performance fees or carried interest. As an investor in our assets, our FFO represents the company’s share of revenues less costs incurred within our operations, which include interest expenses and other costs. Specifically, it includes the impact of contracts that we enter into to generate revenues, including power sales agreements, contracts that our operating businesses enter into such as leases and take or pay contracts and sales of inventory. FFO includes the impact of changes in leverage or the cost of that financial leverage and other costs incurred to operate our business.

We use realized disposition gains and losses within FFO in order to provide additional insight regarding the performance of investments on a cumulative realized basis, including any unrealized fair value adjustments that were recorded in equity and not otherwise reflected in current period FFO, and believe it is useful to investors to better understand variances between reporting periods. We exclude depreciation and amortization from FFO as we believe that the value of most of our assets typically increases over time, provided we make the necessary maintenance expenditures, the timing and magnitude of which may differ from the amount of depreciation recorded in any given period. In addition, the depreciated cost base of our assets is reflected in the ultimate realized disposition gain or loss on disposal. As noted above, unrealized fair value changes are excluded from FFO until the period in which the asset is sold. We also exclude deferred income taxes from FFO because the vast majority of the company’s deferred income tax assets and liabilities are a result of the revaluation of our assets under IFRS.

Our definition of FFO differs from the definition used by other organizations, as well as the definition of FFO used by the Real Property Association of Canada (“REALPAC”) and the National Association of Real Estate Investment Trusts, Inc. (“NAREIT”), in part because the NAREIT definition is based on U.S. GAAP, as opposed to IFRS. The key differences between our definition of FFO and the determination of FFO by REALPAC and/or NAREIT are that we include the following: realized disposition gains or losses and cash taxes payable or receivable on those gains or losses, if any; foreign exchange gains or losses on monetary items not forming part of our net investment in foreign operations; and foreign exchange gains or losses on the sale of an investment in a foreign operation. We do not use FFO as a measure of cash generated from our operations.

Segment measures include amounts earned from consolidated entities that are eliminated on consolidation. The principal adjustment is to include asset management revenues charged to consolidated entities as revenues within the company’s Asset Management segment with the corresponding expenses recorded as corporate costs within the relevant segment. These amounts are based on the in-place terms of the asset management contracts between the consolidated entities. Inter-segment revenues are determined under terms that approximate market value.


AS AT AND FOR THE YEAR ENDED DEC. 31, 2021 (MILLIONS)	Asset Management		Corporate Activities		Renewable Power and Transition		Infrastructure		Private Equity		Real Estate		Residential Development		Total Segments		Note
External revenues	$	306	$	169	$	4,580	$	11,941	$	46,252	$	9,923	$	2,560	$	75,731
Inter-segment and other revenues1	4,930		(18)		—		6		431		32		—		5,381		i
Segmented revenues	5,236		151		4,580		11,947		46,683		9,955		2,560		81,112
FFO from equity accounted investments1	558		63		187		1,697		448		742		111		3,806		ii
Interest expense	—		(414)		(892)		(1,502)		(1,503)		(3,225)		(68)		(7,604)		iii
Current income taxes	—		(38)		(43)		(402)		(537)		(77)		(17)		(1,114)		iv
FFO1	2,614		(370)		1,044		797		2,030		1,185		258		7,558		v
Common equity	4,905		(8,942)		5,264		3,022		3,565		32,004		2,392		42,210
Equity accounted investments	4,496		2,056		1,801		9,569		2,945		24,829		404		46,100
Additions to non-current assets2	—		1,332		5,001		18,248		14,161		21,918		171		60,831

1.We equity account for our investment in Oaktree and include our share of the FFO and FFO from equity accounted investments at 62%. However, for segment reporting, Oaktree’s revenue is shown on a 100% basis. For the year ended December 31, 2021, $2.3 billion of Oaktree’s revenues was included in our Asset Management segment revenue.


AS AT AND FOR THE YEAR ENDED DEC. 31, 2020 (MILLIONS)	Asset Management		Corporate Activities		Renewable Power and Transition		Infrastructure		Private Equity		Real Estate		Residential Development		Total Segments		Note
External revenues	$	246	$	872	$	4,085	$	9,294	$	37,161	$	8,851	$	2,243	$	62,752
Inter-segment and other revenues1	3,278		(1)		—		7		614		32		—		3,930		i
Segmented revenues	3,524		871		4,085		9,301		37,775		8,883		2,243		66,682
FFO from equity accounted investments1	277		(17)		116		1,329		600		765		21		3,091		ii
Interest expense	—		(388)		(885)		(1,224)		(1,573)		(3,117)		(29)		(7,216)		iii
Current income taxes	—		(67)		(66)		(247)		(286)		(82)		(8)		(756)		iv
FFO1	1,776		(86)		1,044		569		935		876		66		5,180		v
Common equity	4,947		(6,986)		5,154		2,552		3,965		19,331		2,730		31,693
Equity accounted investments	4,530		830		1,444		10,530		2,623		21,024		346		41,327
Additions to non-current assets2	64		234		1,677		11,200		3,535		10,117		45		26,872

1.We equity account for our investment in Oaktree and include our share of the FFO and FFO from equity accounted investments at 62%. However, for segment reporting, Oaktree’s revenue is shown on a 100% basis. For the year ended December 31, 2020, $1.2 billion of Oaktree’s revenues was included in our Asset Management segment revenue.

For the year ended December 31, 2021, the adjustment to external revenues when determining segmented revenues consists of asset management revenues earned from consolidated entities and asset management revenues earned by Oaktree totaling $4.9 billion (2020 – $3.3 billion), revenues earned on construction projects between consolidated entities totaling $418 million (2020 – $610 million), and other revenues totaling a net income of $33 million (2020 – $42 million), which were eliminated on consolidation to arrive at the company’s consolidated revenues.

The company determines FFO from its equity accounted investments by applying the same methodology utilized in adjusting net income of consolidated entities. The following table reconciles the company’s consolidated equity accounted income to FFO from equity accounted investments:

For the year ended December 31, 2021, the adjustment to interest expense consists of interest on loans between consolidated entities totaling $28 million (2020 – $8 million) that is eliminated on consolidation, along with the associated revenue.

Current income taxes are included in FFO but are aggregated with deferred income taxes in income tax expense on the company’s Consolidated Statements of Operations. The following table reconciles consolidated income taxes to current and deferred income taxes:



FOR THE YEARS ENDED DEC. 31 (MILLIONS)	Note	2021		2020
Net income		$	12,388	$	707
Financial statement components not included in FFO
Equity accounted fair value changes and other non-FFO items		1,355		3,170
Fair value changes		(5,151)		1,423
Depreciation and amortization		6,437		5,791
Deferred income taxes		1,210		81
Realized disposition gains in fair value changes or equity	vi	2,861		1,554
Non-controlling interests in FFO		(11,542)		(7,546)
Total FFO		$	7,558	$	5,180

Realized disposition gains include gains and losses recorded in net income arising from transactions during the current period, adjusted to include fair value changes and revaluation surplus recorded in prior periods in connection with the assets sold. Realized disposition gains also include amounts that are recorded directly in equity as changes in ownership, as opposed to net income, because they result from a change in ownership of a consolidated entity.

The realized disposition gains recorded in fair value changes, revaluation surplus or directly in equity were $2.9 billion for the year ended December 31, 2021 (2020 – $1.6 billion), of which $2.0 billion relates to prior periods (2020 – $499 million), $751 million has been recorded directly in equity as changes in ownership (2020 – $1.1 billion) and a gain of $136 million has been recorded in fair value changes (2020 – loss of $29 million).



FOR THE YEARS ENDED DEC. 31 (MILLIONS)	2021		2020
U.S.	$	19,694	$	18,048
Canada	7,548		5,906
U.K.	21,497		16,032
Brazil	3,730		3,323
Europe	8,491		6,191
Australia	5,892		5,528
India	2,520		1,284
Colombia	1,890		1,762
Other Asia	2,708		2,388
Other	1,761		2,290
	$	75,731	$	62,752


AS AT DEC. 31 (MILLIONS)	2021		2020
U.S.	$	172,952	$	159,684
Canada	52,989		36,403
U.K.	36,740		31,598
Brazil	22,052		20,675
Europe	32,065		22,267
Australia	20,767		22,000
India	20,935		21,438
Colombia	11,065		10,919
Other Asia	12,866		9,343
Other	8,572		9,369
	$	391,003	$	343,696