UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number: 811-21829 BBH TRUST BBH U.S. Treasury Money Fund BBH Money Market Fund BBH Tax Exempt Money Fund (Exact name of Registrant as specified in charter) 140 Broadway, New York, NY 10005 (Address of principal executive offices) Corporation Services Company, 2711 Centerville Road, Suite 400, Wilmington, DE, 19808 (Name and address of agent for service) Registrant's telephone number, including area code: (212) 593-7237 Date of fiscal year end: JUNE 30 Date of reporting period: JUNE 30, 2008 Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A Registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A Registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. Section 3507. ITEM 1. REPORTS TO STOCKHOLDERS. BROWN [LOGO] BROTHERS HARRIMAN Annual Report JUNE 30, 2008 BBH U.S. TREASURY MONEY FUND <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE For the period of July 1, 2007 to June 30, 2008, the BBH U.S. Treasury Money Fund (the "Fund") produced a total return of 2.57%(1). The weighted average maturity of the Fund during the period varied in a range between 40 and 60 days. We believe the performance of the Fund was competitive within the industry. The Fund seeks to achieve as high a level of current income as is consistent with the preservation of capital and the maintenance of liquidity. The Fund does so by investing solely in U.S. Treasury securities. During the reporting period, the money markets faced an unprecedented credit environment. A common measure of systematic risk within the money markets, the Treasury-Eurodollar (TED) spread, reached peak levels not seen in recent history. One of the largest segments of the money-markets, asset-backed commercial paper ("ABCP"), experienced a period of near-zero liquidity. Many ABCP programs were forced back on to the balance sheets of their sponsoring banks and outstanding issuance was drastically reduced from $1.2 trillion to $750 billion. The catalyst for this market turmoil was the poor performance of mortgage-backed product, and in particular the high degree of leverage applied to it within many money market eligible structures. Difficulties in the money markets quickly spread to the broader credit markets compelling the Federal Reserve to take unprecedented action. During the period, the Fed cut its target interest rate by 325 basis points to 2%. As a response to the collapse of Bear Stearns in March, the Fed opened the discount window to broker/dealer firms and created two auction facilities to provide much needed liquidity to the financial system. These actions worked to ease some of the distress in the credit markets; however, risk premiums remain at abnormally high levels. As conditions deteriorated in the money-markets, government guaranteed securities became highly sought after by investors. This led to an increase in demand for U.S. Treasury bills, placing downward pressure on yields and creating a relatively flat yield curve. As a result, the investment team purchased one to three month U.S. Treasury bills in order to maintain liquidity and maximize yield. - ---------- (1) Performance data quoted represents no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual Fund performance changes over time and current performance may be lower or higher than what is stated. For current to the most recent month end performance and after tax returns, contact the Fund at 1-800-625-5759. 2 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM June 30, 2008 To the Trustees of the BBH Trust and Shareholders of BBH U.S. Treasury Money Fund We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of BBH U.S. Treasury Money Fund (a series of BBH Trust) (the "Fund") as of June 30, 2008, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of June 30, 2008, by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of BBH U.S. Treasury Money Fund as of June 30, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. Deloitte & Touche LLP Boston, Massachusetts August 21, 2008 FINANCIAL STATEMENT JUNE 30, 2008 3 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO ALLOCATION June 30, 2008 BREAKDOWN BY SECURITY TYPE Percent of U.S. $ Value Net Assets ------------ ---------- U.S. Treasury Bills ............................ $ 92,129,716 100.2% Liabilities in Excess of Other Assets .......... (153,490) (0.2) ------------ ----- NET ASSETS ..................................... $ 91,976,226 100.0% ============ ===== All data as of June 30, 2008. The Fund's breakdown by security type is expressed as a percentage of net assets and may vary over time. The accompanying notes are an integral part of these financial statements. 4 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS June 30, 2008 Principal Amount Value - ------------ ------------ U.S. TREASURY BILLS (a) (100.2%) $ 7,000,000 due 07/03/08, 0.760% ............................ $ 6,999,705 20,440,000 due 07/10/08, 1.315% ............................ 20,433,295 39,180,000 due 07/17/08, 1.638% ............................ 39,151,527 6,870,000 due 08/07/08, 1.641% ............................ 6,858,457 8,900,000 due 08/14/08, 1.493% ............................ 8,883,792 9,875,000 due 11/20/08, 1.867% ............................ 9,802,940 ------------ Total U.S. Treasury Bills ....................... 92,129,716 ------------ TOTAL INVESTMENTS, AT AMORTIZED COST ........... 100.2% $ 92,129,716 LIABILITIES IN EXCESS OF OTHER ASSETS .......... (0.2) (153,490) ------------ ------------ NET ASSETS ..................................... 100.0% $ 91,976,226 ============ ============ - ---------- (a) Rates shown are yields to maturity at time of purchase. The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 5 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- STATEMENT OF ASSETS AND LIABILITIES June 30, 2008 ASSETS: Investments, at amortized cost .............................. $92,129,716 ----------- Total Assets ............................................. 92,129,716 ----------- LIABILITIES: Due to Brown Brothers Harriman & Co. ........................ 50,621 Payables for: Investment advisory and administrative fees .............. 24,936 Professional fees ........................................ 22,544 Shareholder servicing fees ............................... 21,843 Custody and accounting fees .............................. 10,233 State registration fees .................................. 4,293 Dividends declared ....................................... 1,163 Board of Trustees' fees .................................. 294 Accrued expenses and other liabilities ...................... 17,563 ----------- Total Liabilities ........................................ 153,490 ----------- NET ASSETS, for 91,976,358 fund shares outstanding ............. $91,976,226 =========== Net Assets Consist of: Paid-in capital ............................................. $91,976,226 ----------- Net Assets ..................................................... $91,976,226 =========== NET ASSET VALUE AND OFFERING PRICE PER SHARE ................... $1.00 ===== The accompanying notes are an integral part of these financial statements. 6 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- STATEMENT OF OPERATIONS For the year ended June 30, 2008 NET INVESTMENT INCOME: Income: Investment income ..................................... $ 2,269,632 ----------- Expenses: Investment advisory and administrative fees ........... 182,880 Shareholder servicing fees ............................ 164,592 State registration fees ............................... 34,132 Custody and accounting fees ........................... 25,978 Professional fees ..................................... 20,931 Board of Trustees' fees ............................... 16,013 Miscellaneous expenses ................................ 48,883 ----------- Total Expenses ...................................... 493,409 Expense offset arrangement .......................... (4,480) ----------- Net Expenses ........................................ 488,929 ----------- Net Investment Income .................................... $ 1,780,703 ----------- The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 7 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- STATEMENTS OF CHANGES IN NET ASSETS <TABLE> <CAPTION> For the years ended June 30, -------------------------------- 2008 2007 ------------- ------------- <S> <C> <C> INCREASE (DECREASE) IN NET ASSETS: From Operations: Net investment income ............................................... $ 1,780,703 $ 3,842,702 Dividends declared from net investment income .......................... (1,780,703) (3,842,702) ------------- ------------- From Fund Share (Principal) Transactions at Net Asset Value of $1.00 per share: Fund shares sold .................................................. 220,163,437 169,360,686 Fund shares issued in reinvestment of dividends ................... 514 1,684,859 Fund shares repurchased ........................................... (203,427,489) (207,159,757) ------------- ------------- Net increase (decrease) in net assets resulting from fund share transactions ................................. 16,736,462 (36,114,212) ------------- ------------- NET ASSETS: Beginning of year ...................................................... 75,239,764 111,353,976 ------------- ------------- End of Year ............................................................ $ 91,976,226 $ 75,239,764 ============= ============= </TABLE> The accompanying notes are an integral part of these financial statements. 8 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS Selected per share data and ratios for a share outstanding throughout each year <TABLE> <CAPTION> For the years ended June 30, ----------------------------------------------------------- 2008 2007 2006 2005 2004 ------- ------- ------- ------- ------- <S> <C> <C> <C> <C> <C> Net asset value, beginning of year ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Income from investment operations: Net investment income ...................... 0.02 0.04 0.03 0.01 0.00(1) Dividends to shareholders from net investment income .......................... (0.02) (0.04) (0.03) (0.01) (0.00)(1) ------- ------- ------- ------- ------- Net asset value, end of year .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======= ======= ======= ======= ======= Total return .................................. 2.57% 4.45% 3.35% 1.41% 0.40% Ratios/Supplemental data: Net assets, end of year (in millions) ...... $ 92 $ 75 $ 111 $ 141 $ 117 Net expenses paid by Fund .................. 0.67% 0.62% 0.59% 0.56% 0.59% Expense offset arrangement ................. 0.00%(2) 0.01% 0.00%(2) 0.01% 0.00%(2) ------- ------- ------- ------- ------- Total expenses .......................... 0.67% 0.63% 0.59% 0.57% 0.59% ======= ======= ======= ======= ======= Ratio of net investment income to average net assets ...................... 2.43% 4.36% 3.25% 1.49% 0.39% </TABLE> - ---------- (1) Less than $0.01 per share. (2) Less than 0.01%. The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 9 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS June 30, 2008 1. Organization and Significant Accounting Policies. BBH U.S. Treasury Money Fund (the "Fund") is a separate, diversified series of BBH Trust (the "Trust"), which is registered under the Investment Company Act of 1940, as amended. The Trust is an open-end management investment company organized as a Massachusetts business trust on June 7, 1983 and re-organized as a Delaware statutory trust on June 12, 2007. The Fund commenced operations on March 12, 1991. The Declaration of Trust permits the Trustees to create an unlimited number of series, each of which may issue a separate class of shares. The Trustees have authorized the issuance of an unlimited number of shares of the Fund without a par value. At June 30, 2008, there were seven series of the Trust. The Fund's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements and are based, in part, on the following accounting policies. Actual results could differ from those estimates. A. Valuation of Investments. The Fund values its investments at amortized cost, which approximates market value. The amortized cost method values a security at its cost at the time of purchase and thereafter assumes a constant amortization to maturity of any discount or premium. The Fund's use of amortized cost is in compliance with Rule 2a-7 of the Investment Company Act of 1940. B. Investment Transactions and Income. Investment transactions are accounted for on the trade date. Realized gains and losses, if any, from investment transactions are determined on the basis of identified cost. Interest income consists of interest accrued and discount earned (including both original issue and market discount) and premium amortization on the investments of the Fund, accrued ratably to the date of maturity. C. Federal Income Taxes. Each series of the Trust is treated as a separate entity for federal income tax purposes. It is the Fund's policy to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. At June 30, 2008, the cost of investments for federal income tax purposes was equal to the amortized cost of investments for financial statement purposes. D. Dividends and Distributions to Shareholders. Dividends from net investment income are declared daily and paid monthly to shareholders. The Fund declared dividends in the amounts of $1,780,703 and $3,842,702 for the years ended June 30, 2008 and June 30, 2007, respectively. The tax character of the dividends declared in both years was 100% ordinary income. 10 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 E. Accounting Developments. In June 2006, the Fund adopted FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. The adoption of FIN 48 had no impact on the operations of the Fund for the period ended June 30, 2008. In September 2006, Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS 157), was issued and is effective for fiscal years beginning after November 15, 2007. SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. Management is currently evaluating the implication of SFAS 157. At this time its impact on the Fund's financial statements has not yet been determined. In March 2008, Statement of Financial Accounting Standards No. 161, Disclosures about Derivative Instruments and Hedging Activities (SFAS 161), was issued and is effective for fiscal years beginning after November 15, 2008. SFAS 161 requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. Management is currently evaluating the impact the adoption of SFAS 161 will have on the Fund's financial statement disclosures. 2. Transactions with Affiliates. Investment Advisory and Administrative Fees. Effective June 12, 2007, under a combined Investment Advisory and Administrative Services Agreement ("Agreement") with the Trust, a separately identifiable department within Brown Brothers Harriman & Co. ("BBH") provides investment advice, and portfolio management and administrative services to the Fund. BBH receives a combined fee from the Fund for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.25% of the fund's average daily net assets. Prior to June 12, 2007, under a separate agreement that covered only investment advisory fees, BBH received a fee from the Fund calculated daily and paid monthly at an annual rate of 0.15% of the Fund's average daily net assets. Brown Brothers Harriman Trust Company, LLC, the Fund's administrator, under a separate agreement that covered only administrative services, received a fee from the Fund calculated daily and paid monthly at an annual rate equivalent to 0.10% of the Fund's average daily net assets. BBH has a sub-administration services agreement with Federated Services Company ("FSC") for which FSC receives compensation paid by BBH. For the year ended June 30, 2008, the Fund incurred $182,880 for investment advisory and administrative services. FINANCIAL STATEMENT JUNE 30, 2008 11 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 Shareholder Servicing Fees. The Trust has a shareholder servicing agreement with BBH for which BBH receives a fee from the Fund calculated daily and paid monthly at an annual rate of 0.225% of the Fund's average daily net assets. For the year ended June 30, 2008, the Fund incurred $164,592 for shareholder servicing services. Custody and Accounting Fees. BBH acts as a custodian and shall receive a custody and accounting fee from the Fund calculated daily and paid monthly. The custody fee is a transaction based fee with an annual minimum of $20,000, and the accounting fee is calculated at 0.01% per annum on the first $1 billion of net assets and 0.005% per annum on all net assets over $1 billion. For the year ended June 30, 2008, the Fund incurred $25,978 for custody and accounting services. These fees were reduced by $4,480 as a result of an expense offset arrangement with the Fund's custodian. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to the agreement, the Fund will be charged interest based on LIBOR on the day of overdraft plus one percent. The total interest paid by the Fund for the year ended June 30, 2008 was $8,274. Board of Trustees' Fees. Each Trustee receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the year ended June 30, 2008, the Fund incurred $16,013 for these fees. 3. Federal Income Tax Status. The Fund had a net capital loss carryforward of approximately $4,354 which expires as follows: Expiration date Amount --------------- ------ 06/30/2015 $4,354 ====== The differences between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax deferral of losses on wash sales. To the extent that this net capital loss carryover is used to offset future capital gains, it is probable the gains to offset will not be distributed to shareholders since any such distributions may be taxable to shareholders as ordinary income. 12 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF FUND EXPENSES June 30, 2008 EXAMPLE As a shareholder of BBH U.S. Treasury Money Fund (the "Fund"), you may incur two types of costs: (1) transaction costs on purchase payments, reinvested dividends, or other distributions; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2008 to June 30, 2008). ACTUAL EXPENSES The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During the Period" to estimate the expenses you paid on your account during the period. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. <TABLE> <CAPTION> Expenses Paid Beginning Ending During Period Account Value Account Value January 1, 2008 January 1, 2008 June 30, 2008 to June 30, 2008(1) --------------- ------------- ------------------- <S> <C> <C> <C> Actual...................... $1,000 $1,008.00 $3.35 Hypothetical(2)............. $1,000 $1,021.53 $3.37 </TABLE> - ---------- (1) Expenses are equal to the Fund's annualized expense ratio of 0.67%, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period). (2) Assumes a return of 5% before expenses. For the purpose of the calculation, the applicable annualized expense ratio is subtracted from the assumed return before expenses. FINANCIAL STATEMENT JUNE 30, 2008 13 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION June 30, 2008 Approval of Investment Advisory/Administrative Services Agreement At a meeting held on December 11, 2006, the Board of Trustees (the "Board") of the Trust and the Corporation unanimously approved a new Combined Investment Advisory/Administrative Services Agreement ("Combined Agreement"). The Board determined that the terms of the Combined Agreement will be substantially identical to those of the current advisory and administration agreements of the Funds, noting that the most significant difference in the Combined Agreement is a single fee for both investment advisory and administrative services. The following is a summary of the factors the Board took into consideration in making its determination to approve the new Combined Agreement. Nature, Extent and Quality of Services Provided by Brown Brothers Harriman & Co. ("BBH") The Board noted that, under the Combined Agreement in respect of each Fund, BBH, subject to the supervision of the Board, will be responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Funds' investment objective and policies. Under the Combined Agreement, BBH also provides administrative services to each Fund. The Board considered the scope and quality of services to be provided by BBH under the Combined Agreement and noted that the scope of services provided had expanded over time, primarily, as a result of regulatory developments. The Board noted that, for example, BBH is responsible for maintaining and monitoring its own and, to varying degrees, the Funds' compliance program, and these compliance programs had recently been refined and enhanced in light of new regulatory requirements. The Board considered the quality of the investment research and administrative capabilities of BBH and the other resources it has dedicated to performing services for the Funds. The Board concluded that, overall, they were satisfied with the nature, extent and quality of services expected to be provided to each of the Funds under the Combined Agreement. Costs of Services Provided and Profitability to BBH At the request of the Board, BBH provided information concerning the profitability of BBH's current investment company advisory and other fees. The Board also reviewed BBH's profitability data for each Fund, which also included the effect of revenue generated by the shareholder servicing, administration, custody and other fees paid by the Fund. The Board discussed the difficulty of making comparisons of profitability because comparative information is not generally publicly available and is affected by numerous factors, including the structure of the service provider, the types of funds it manages and administers, its business mix, numerous assumptions regarding allocations and the entity's capital structure and cost of capital. In considering profitability information, the Board considered the effect of fall-out benefits on BBH's expenses, as well as the "revenue sharing" arrangements BBH has entered into with certain entities that distribute shares of the Funds. The Board focused on profitability of BBH's relationships with the Funds before taxes and distribution expenses. The Board concluded that it was satisfied that BBH's level of profitability from its relationship with each Fund was not excessive. 14 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 Fall-Out Benefits The Board considered that BBH does not allocate the Funds' portfolio transactions for third party research, although it did benefit from proprietary research received from brokers that execute the Funds' purchases and sales of securities. The Board recognized that the aggregate amount of commissions generated by Fund transactions was unlikely to result in the Funds receiving from full service broker dealers substantial discounts on commission rates. The Board received and reviewed information concerning BBH's policies with respect to allocating portfolio brokerage. The Board also considered that BBH receives shareholder servicing fees from certain funds, and is the Funds' administrator, custodian and securities lending agent. The Board noted that BBH retained no portion of the 12b-1 fees paid by any Fund that operated with a Rule 12b-1 plan. The Board recognized that BBH's profitability would be somewhat lower if it did not receive proprietary research for commissions or, if it did not receive the other benefits described above. The Board recognized that most Fund shareholders were also BBH clients, and that substantial assets are invested in the Funds as a result of an overall investment management program for the shareholder. The Board noted that the Funds also derive reputational and other benefits from their association with BBH and their use of the BBH name, which is licensed to the Funds by BBH. Thus, the Board did not believe that BBH revenues associated with its clients should be fairly regarded as "fallout" benefit from the Funds. Economies of Scale The Board noted that the Funds' combined fee schedules, other than the fee schedule for BBH Money Market Fund, do not contain breakpoints. As a result, if assets increase, the fee rates would not be reduced for these Funds on the incremental assets. With respect to the BBH Money Market Fund, the breakpoint will be reviewed every three (3) years by the Board, and may be adjusted upwards to take into account the effects of inflation or such other basis as may be appropriate, subject to the approval of shareholders to the extent required by the 1940 Act. There may be other economies of scale because many expenses did not rise (and fall) proportionally to increases (and decreases) in total net assets. The Board noted that BBH had priced its services in recognition of the fact that it was largely its own clients who were shareholders and, accordingly, sought to assure that the cost of these services and total expenses for each Fund were fair and reasonable. In addition, the Board noted that over the years BBH had supported certain Funds through fee waivers and expense reimbursements. Based on information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Funds, there FINANCIAL STATEMENT JUNE 30, 2008 15 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints (if any) apply. In light of the Funds' current size and expense structure, the Board concluded that it was unnecessary at this time to consider breakpoints with respect to the Funds, other than for the BBH Money Market Fund. Investment Results The Board considered the investment results of each of the Funds as compared to investment companies with its peers and with one or more selected securities indices. In addition to the information received by the Board for the meeting held on December 11, 2006, the Board received detailed performance information for each Fund at each regular Board meeting during the year. At the meeting held on October 2, 2006, the Board reviewed information showing performance of each Fund compared to its peers over the prior 1-, 3-, and 5- year periods and compared the performance information to one or more securities indices over comparable periods. Combined Fee Rate The Board considered the fee rate to be paid by each Fund to BBH. The Board recognized that it is difficult to make comparisons of these fee rates, and the combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board considered the depth and range of services provided under the Combined Agreement. For example, in addition to a continuous investment program, BBH provides, among other things, officers (including the Funds' Chief Compliance Officer and officers to provide required certifications) and administrative services, such as shareholder communications, and tax compliance, with the attendant costs and exposure to liability. BBH also coordinates the provision of services to the Funds by nonaffiliated service providers. The following factors specific to BBH U.S. Treasury Money Fund also were noted and considered by the Board in deciding to approve the Combined Agreement: The Board considered the 1-, 3- and 5-year annualized total returns of the BBH U.S. Treasury Money Fund versus the iMoneyNet (Treasury Retail). The Board noted that the Fund outperformed or performed in line with that average over all relevant periods. Moreover, the Board noted that it believes to have been appropriately advised by BBH about its duration and average weighted maturity decisions during the relevant periods and were satisfied overall with the competitiveness of the performance. The Board also noted with favor that the expense ratio was substantially lower than that of the average. The Board also noted that the BBH U.S. Treasury Money Fund had successfully maintained a stable net asset value of one dollar at all times. Taking into account these comparisons and the other factors considered, the Trustees concluded that the BBH U.S. Treasury Money Fund's investment results over time and its total expense ratio had been satisfactory. 16 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 Conflicts of Interest As a general matter, certain conflicts of interest may arise in connection with a portfolio manager's management of a Fund's investments, on the one hand, and the investments of other accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various accounts managed could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Fund. Alternatively, to the extent that the same investment opportunities might be desirable for more than one account, possible conflicts could arise in determining how to allocate them. Other potential conflicts might include conflicts created by specific portfolio manager compensation arrangements, and conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades (for example, research, or "soft dollars"). BBH has adopted and implemented policies and procedures, including brokerage and trade allocation policies and procedures, which it believes address the conflicts associated with managing multiple accounts for multiple clients. In addition, BBH monitors a variety of areas, including compliance with account investment guidelines, the inclusion only of securities approved for purchase by the BBH's Fixed Income Credit Committee, and compliance with the BBH's Code of Ethics. Finally, BBH has structured the portfolio managers' compensation in a manner, and the Funds have adopted policies and procedures, reasonably designed to safeguard a Fund from being negatively affected as a result of any such potential conflicts. FINANCIAL STATEMENT JUNE 30, 2008 17 <PAGE> BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- ADDITIONAL FEDERAL TAX INFORMATION June 30, 2008 In January 2009, the Fund will report on Form 1099 the tax status of all distributions made during the calendar year 2008. Shareholders should use the information on Form 1099 for their income tax returns. 18 <PAGE> TRUSTEES AND OFFICERS OF BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- (unaudited) Information pertaining to the Trustees of the BBH Trust (the "Trust") and executive officers of the Trust is set forth below. Part B to the Registration Statement of the BBH U.S. Treasury Money Fund includes additional information about the Fund's Trustees and is available upon request without charge by contacting the Fund at 1-800-625-5759. <TABLE> <CAPTION> Number of Term of Funds in Office and Fund Other Position(s) Length Complex Directorships Name, Birth Date Held with of Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - -------------------------------------------------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> Joseph V. Shields Jr. Chairman of Since 2007 Managing Director, Chairman and 7 None Birth Date: the Board Chief Executive Officer of March 17, 1938 and Trustee Shields & Company (member of Shields & Company New York Stock Exchange); 140 Broadway Chairman of Capital Management New York, NY 10005 Associates, Inc. (registered investment adviser); Director of Flower Foods, Inc. (New York Stock Exchange listed company). David P. Feldman Trustee Since 2007 Director of Jeffrey Co. (1992 7 Director of Birth Date: to present); Director of QMED Dreyfus November 16, 1939 (1999 to May 2007). Mutual Funds c/o BBH & Co. (59 Funds) 140 Broadway New York, NY 10005 Alan G. Lowy Trustee Since 2007 Private Investor. 7 None Birth Date: April 17, 1939 4111 Clear Valley Drive Encino, CA 91436 Arthur D. Miltenberger Trustee Since 2007 Retired; Trustee, R.K. Mellon 7 None Birth Date: Family Trust (1981 to June November 8, 1938 2003); Director of 503 Darlington Road Aerostructures Corporation Ligonier, PA 15658 (aircraft manufacturer) (1996 to July 2003). Samuel F. Pryor, IV Trustee Since 2007 Private Investor. 7 None Birth Date: June 12, 1955 130 East 67th Street New York, NY 10021 </TABLE> FINANCIAL STATEMENT JUNE 30, 2008 19 <PAGE> TRUSTEES AND OFFICERS OF BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- (unaudited) <TABLE> <CAPTION> Number of Term of Funds in Office and Fund Other Position(s) Length Complex Directorships Name, Birth Date Held with of Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - ---------------------------------------------------------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> H. Whitney Wagner Trustee Since 2007 President, Clear Brook 7 None Birth Date: Advisors, a registered March 3, 1956 investment advisor. Clear Brook Advisors 75 Rockefeller Plaza, 14th Floor New York, NY 10019 Officers John A. Gehret President Since 2008 President and Principal N/A N/A Birth Date: and Executive Officer of the Trust; April 11, 1959 Principal Joined Brown Brothers Harriman 140 Broadway Executive & Co. ("BBH & Co.") in 1981 and New York, NY 10005 Officer has been a Partner of the firm since 1998. Charles H. Schreiber Treasurer Since 2007 Treasurer and Principal N/A N/A Birth Date: and Financial Officer of the Trust; December 10, 1957 Principal Senior Vice President of BBH & 140 Broadway Financial Co. since September 2001; New York, NY 10005 Officer Joined BBH & Co. in 1999. Mark B. Nixon Assistant Since 2007 Assistant Secretary and N/A N/A Birth Date: Secretary, Assistant Treasurer of the January 14, 1963 Assistant Trust; Vice President of BBH & 140 Broadway Treasurer Co. (since October 2006); New York, NY 10005 Accounting Manager, Reserve Funds (August 2005-September 2006); Assistant Controller, Reserve Funds (February 2005-August 2005); Private Consultant (December 2001-February 2005). Beth Haddock Chief Since 2007 Chief Compliance Officer of the N/A N/A Birth Date: Compliance Trust (September 2007-present); December 10, 1965 Officer Chief Compliance Officer for 140 Broadway the FINRA/NYSE and SEC New York, NY 10005 compliance programs and Associate Compliance Director for the global compliance program (April 2005-present); Deputy General Counsel of AXA Advisors/AXA Financial (November 1997-April 2005). </TABLE> 20 <PAGE> TRUSTEES AND OFFICERS OF BBH U.S. TREASURY MONEY FUND - -------------------------------------------------------------------------------- (unaudited) <TABLE> <CAPTION> Number of Term of Funds in Office and Fund Other Position(s) Length Complex Directorships Name, Birth Date Held with of Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - ---------------------------------------------------------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> Sue M. Rim-An Anti-Money Since 2008 Anti-Money Laundering Officer, N/A N/A Birth Date: Laundering Vice President of BBH & Co. September 10, 1970 Officer (September 2007-present); AML 140 Broadway Officer at UBS Investment Bank New York, NY 10005 (April 2006-August 2007); AML Officer & Vice President in Private Client Services at Bear Stearns & Co (June 1992-April 2006). Gail C. Jones Secretary Since 2007 Secretary of the Trust; N/A N/A Birth Date: Counsel, ReedSmith, LLP (since October 26, 1953 October 2002); Corporate 1001 Liberty Avenue Counsel (January 1997 to Pittsburgh, PA September 2002) and Vice 15222-3779 President (January 1999 to September 2002) of Federated Services Company. George M. Polatas Vice Since 2008 Vice President of the Trust N/A N/A Birth Date: President (since June 2008); Assistant March 3, 1962 Vice President of Federated 1001 Liberty Avenue, Services Company; Vice Pittsburgh, PA President of various funds 15222-3779 distributed by Edgewood Services, Inc (January 1997 to present). Theodore J. Boudria Assistant Since 2008 Assistant Treasurer of the N/A N/A Birth Date: Treasurer Trust; Vice President (since June 26, 1968 2003); Assistant Vice President 70 Franklin Street (since September 2000); Joined Boston, MA 02110 BBH & Co. in 1995. </TABLE> - ---------- # Each Trustee of the Trust holds office until he or she attains the age of 70 (72, in the case of Trustees who were elected as such before January 1, 2000), or until he or she sooner dies, resigns or is removed from office in accordance with the provisions of the Trust's Declaration of Trust. All officers of the Trust hold office for one year and until their respective successors are chosen and qualified (subject to the ability of the Trustees to remove any officer in accordance with the Trust's By-laws). ^ The Fund Complex consists of the Trust, which has seven series and each is counted as one "Fund" for purposes of this table. FINANCIAL STATEMENT JUNE 30, 2008 21 <PAGE> INVESTMENT ADVISER AND ADMINISTRATOR BROWN BROTHERS HARRIMAN 140 BROADWAY NEW YORK, NY 10005 DISTRIBUTOR EDGEWOOD SERVICES, INC. 5800 CORPORATE DRIVE PITTSBURGH, PA 15237-7000 SHAREHOLDER SERVICING AGENT BROWN BROTHERS HARRIMAN 140 BROADWAY NEW YORK, NY 10005 (800) 625-5759 To obtain information or make shareholder inquiries: By telephone: Call 1-800-575-1265 By E-mail send your request to: bbhfunds@bbh.com On the internet: www.bbhfunds.com This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund. Such offering is made only by the prospectus, which includes details as to offering price and other material information. The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." Information on Form N-Q is available without charge and upon request by calling the Funds at the toll-free number listed above. A text only version can be viewed online or downloaded from the SEC's website at http://www.sec.gov; and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC (call 1-800-SEC-0330 for information on the operation of the Public Reference Room). You may also access this information from the BBH website at BBH.com by clicking on "BBH Mutual Funds" and selecting "Online Documents/Holdings Information." A copy of the Fund's Proxy Voting Policy is available upon request by calling the toll-free number listed above. A text-only version of the policy can be viewed online or downloaded from the SEC at www.sec.gov. BROWN [LOGO] BROTHERS HARRIMAN BROWN [LOGO] BROTHERS HARRIMAN Annual Report JUNE 30, 2008 BBH MONEY MARKET FUND <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE For the period of July 1, 2007 to June 30, 2008, the BBH Money Market Fund (the "Fund") produced a total return of 3.77%(1). We believe the performance of the Fund was competitive within the industry despite what we believe to be a conservative portfolio composition and in light of very difficult market conditions. The Fund seeks to achieve as high a level of current income as is consistent with the preservation of capital and the maintenance of liquidity. The Fund does so by investing primarily in a diversified portfolio of liquid, high-quality short-term debt securities. To that end, the Fund's investments include securities issued or guaranteed as to principal and interest by the U.S. government or its agencies, certificates of deposit and commercial paper issued by large, well capitalized global banks, commercial paper issued by large credit worthy U.S. corporations, and repurchase agreements backed by U.S. government and agency collateral. The Fund did not have any exposure to Structured Investment Vehicles ("SIVs") during the period and removed asset-backed commercial paper ("ABCP") from its investment strategy. During the reporting period, the money markets faced an unprecedented credit environment. A common measure of systematic risk within the money markets, the Treasury-Eurodollar (TED) spread, reached peak levels not seen in recent history. One of the largest segments of the money-markets, ABCP, experienced a period of near-zero liquidity. Many ABCP programs were forced back on to the balance sheets of their sponsoring banks and outstanding issuance was drastically reduced from $1.2 trillion to $750 billion. The catalyst for this market turmoil was the poor performance of mortgage-backed product, and in particular the high degree of leverage applied to it within many money market eligible structures. Difficulties in the money markets quickly spread to the broader credit markets compelling the Federal Reserve to take unprecedented action. During the period, the Fed cut its target interest rate by 325 basis points to 2%. As a response to the collapse of Bear Stearns in March, the Fed opened the discount window to broker/dealer firms and created two auction facilities to provide much needed liquidity to the financial system. These actions worked to ease some of the distress in the credit markets; however, risk premiums remain at abnormally high levels. Throughout this difficult environment, the investment team for the BBH Money Market Fund maintained what it believed to be a conservative investment strategy, which enabled the Fund to largely avoid some of the more distressed areas of the markets including SIVs and ABCP. At the onset of the credit crisis, the Fund had only a modest position to short-maturity ABCP. Brown Brothers Harriman & Co. continues to perform its own rigorous credit assessment of all securities purchased for the Fund and does not rely on the rating agencies to determine credit quality. As a result, the investment team has been able to deliver a consistently competitive return and ample liquidity even with the recent adverse conditions present in the money-markets. - ---------- (1) Performance data quoted represents no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual Fund performance changes over time and current performance may be lower or higher than what is stated. For current to the most recent month end performance and after tax returns, contact the Fund at 1-800-625-5759. 2 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM June 30, 2008 To the Trustees of the BBH Trust and Shareholders of BBH Money Market Fund We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of BBH Money Market Fund (a series of BBH Trust) (the "Fund") as of June 30, 2008, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of June 30, 2008, by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of BBH Money Market Fund as of June 30, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. Deloitte & Touche LLP Boston, Massachusetts August 21, 2008 FINANCIAL STATEMENT JUNE 30, 2008 3 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO ALLOCATION June 30, 2008 BREAKDOWN BY SECURITY TYPE Percent of U.S. $ Value Net Assets -------------- ---------- Certificates of Deposit ........................ $ 175,137,991 8.1% Commercial Paper ............................... 1,125,842,819 51.8 Corporate Bonds ................................ 253,531,649 11.7 Municipal Bonds ................................ 174,745,000 8.0 Mutual Fund .................................... 57,730,000 2.6 U.S. Government Agency Obligations ............. 57,875,720 2.7 Repurchase Agreements .......................... 325,000,000 14.9 Other Assets in Excess of Liabilities .......... 4,034,527 0.2 -------------- ----- NET ASSETS ..................................... $2,173,897,706 100.0% ============== ===== All data as of June 30, 2008. The Fund's breakdown by security type is expressed as a percentage of net assets and may vary over time. The accompanying notes are an integral part of these financial statements. 4 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- -------------- <C> <C> <C> <C> <C> CERTIFICATES OF DEPOSIT (8.1%) $21,800,000 Banco Bilbao Vizcaya Argentaria.................................. 09/12/08 2.780% $ 21,800,439 18,800,000 Banco Santander, New York........................................ 08/26/08 3.000 18,801,441 8,600,000 Bank of Montreal................................................. 07/17/08 3.740 8,602,767 12,800,000 Bank of Montreal(1).............................................. 07/28/08 2.673 12,800,304 12,800,000 Bank of Montreal(1).............................................. 07/31/08 2.989 12,800,220 21,400,000 Bank of Tokyo-Mitsubishi UFJ..................................... 09/08/08 2.670 21,400,407 10,300,000 BNP Paribas(1)................................................... 07/03/08 2.398 10,299,978 17,100,000 Calyon, New York................................................. 07/14/08 4.030 17,106,802 21,400,000 Depfa Bank, Plc.................................................. 07/28/08 2.520 21,400,000 8,600,000 Royal Bank of Canada............................................. 02/02/09 5.290 8,725,598 21,400,000 Toronto Dominion Bank............................................ 07/07/08 2.900 21,400,035 -------------- Total Certificates of Deposit.................................... 175,137,991 -------------- COMMERCIAL PAPER (51.8%) 15,650,000 Archer Daniels Midland Co........................................ 07/17/08 2.520 15,632,611 19,300,000 Archer Daniels Midland Co........................................ 07/22/08 2.060 19,276,920 8,600,000 Archer Daniels Midland Co........................................ 08/05/08 2.266 8,581,187 33,286,000 Ascension Health................................................. 07/23/08 2.370 33,237,892 25,000,000 Baker Hughes, Inc................................................ 07/01/08 2.500 25,000,000 4,300,000 Bank of America Corp............................................. 07/01/08 2.785 4,300,000 26,955,000 BMW US Capital LLC............................................... 07/01/08 2.350 26,955,000 2,600,000 Brown University................................................. 08/06/08 2.442 2,593,760 19,500,000 Brown University................................................. 08/12/08 2.379 19,446,082 8,600,000 Brown-Forman Beverages, Europe, Ltd.............................. 09/08/08 2.293 8,562,418 24,100,000 Catholic Health Initiative....................................... 08/20/08 2.600 24,100,000 14,500,000 CBA (Delaware) Finance........................................... 07/11/08 2.502 14,489,931 19,917,000 City of Chicago, IIIinois........................................ 02/02/09 2.999 19,570,444 21,400,000 Coca-Cola Co..................................................... 08/06/08 2.148 21,354,204 36,080,000 Columbia University.............................................. 07/01/08 2.254 36,080,000 25,000,000 Commerzbank US Finance........................................... 07/01/08 2.640 25,000,000 17,100,000 ConocoPhillips Co................................................ 07/02/08 2.053 17,099,026 15,000,000 Cornell University............................................... 07/17/08 2.461 14,983,667 21,400,000 Danske Corp...................................................... 07/02/08 2.485 21,398,526 12,000,000 Danske Corp...................................................... 07/03/08 2.405 11,998,400 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 5 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- -------------- <C> <C> <C> <C> <C> COMMERCIAL PAPER (continued) $ 6,100,000 De Kalb County, Georgia Development Authority Revenue.............................................. 07/23/08 2.500% $ 6,100,000 9,148,000 Duke University.................................................. 08/06/08 2.409 9,126,043 13,450,000 General Electric Capital Corp.................................... 07/14/08 2.519 13,437,858 21,400,000 IBM Corp......................................................... 07/21/08 2.115 21,374,914 21,150,000 IBM Corp......................................................... 08/01/08 2.206 21,109,932 12,800,000 ING (US) Funding LLC............................................. 07/17/08 2.521 12,785,721 8,600,000 ING (US) Funding LLC............................................. 08/14/08 2.577 8,573,092 25,000,000 International Lease Finance Corp................................. 07/01/08 2.651 25,000,000 21,500,000 Johns Hopkins University......................................... 07/22/08 2.600 21,500,000 10,300,000 Johns Hopkins University......................................... 07/24/08 2.500 10,300,000 21,400,000 Koch Resources LLC............................................... 07/16/08 2.214 21,380,294 25,000,000 Leggett & Platt, Inc............................................. 07/01/08 2.300 25,000,000 21,400,000 Leggett & Platt, Inc............................................. 07/02/08 2.123 21,398,740 34,300,000 Los Angeles Department of Airports............................... 07/03/08 2.408 34,295,484 12,800,000 State of Michigan................................................ 10/28/08 4.900 12,800,000 25,000,000 National Rural Utilities Cooperative Finance Corp. ................................................. 07/11/08 2.302 24,984,028 25,680,000 Nebraska Public Power Authority.................................. 07/01/08 2.387 25,680,000 25,000,000 Nestle Capital Corp.............................................. 07/01/08 2.300 25,000,000 21,400,000 Nestle Capital Corp.............................................. 07/24/08 2.147 21,370,741 30,805,000 New York State Power Authority................................... 07/22/08 2.599 30,759,178 21,400,000 State of North Carolina.......................................... 07/22/08 2.350 21,400,000 12,800,000 Pepsi Bottling Group, Inc........................................ 07/01/08 2.152 12,800,000 21,400,000 Pfizer, Inc...................................................... 07/18/08 2.126 21,378,576 25,000,000 Rabobank USA Financial Corp...................................... 07/01/08 2.240 25,000,000 12,800,000 Rabobank USA Financial Corp...................................... 07/07/08 2.355 12,794,987 9,800,000 Rabobank USA Financial Corp...................................... 07/18/08 2.355 9,789,125 4,575,000 Rights of University of Michigan................................. 09/02/08 2.580 4,575,000 50,000,000 Rockwell Automation.............................................. 07/01/08 2.250 50,000,000 11,600,000 Rutgers, State University of New Jersey.......................... 07/16/08 2.400 11,600,000 14,000,000 Southern Company Funding......................................... 07/02/08 2.222 13,999,137 9,300,000 Stanley Works.................................................... 07/10/08 2.107 9,295,118 </TABLE> The accompanying notes are an integral part of these financial statements. 6 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- -------------- <C> <C> <C> <C> <C> COMMERCIAL PAPER (continued) $12,800,000 Stanley Works.................................................... 07/29/08 2.126% $ 12,778,894 1,700,000 Tennessee State School Bond...................................... 07/24/08 2.400 1,700,000 13,388,000 Tennessee State School Bond...................................... 07/24/08 2.400 13,388,000 25,937,000 Tennessee State School Bond...................................... 08/20/08 2.650 25,937,000 25,000,000 Trinity Health Corp.............................................. 08/04/08 2.406 24,943,333 21,400,000 UBS Finance Delaware LLC......................................... 07/07/08 2.945 21,389,603 6,708,000 University of Texas System Board of Regents...................... 07/22/08 2.550 6,708,000 26,260,000 Walnut Energy Center Authority................................... 07/17/08 2.624 26,229,953 38,500,000 Yale University.................................................. 07/01/08 2.254 38,500,000 -------------- Total Commercial Paper........................................... 1,125,842,819 -------------- CORPORATE BONDS (11.7%) 10,700,000 Associates Corp. of North America................................ 11/01/08 6.250 10,747,493 8,620,000 Associates Corp. of North America................................ 11/15/08 6.875 8,731,402 8,000,000 Bank of America Corp............................................. 02/15/09 5.875 8,119,416 21,400,000 BellSouth Corp.(1)............................................... 08/15/08 2.776 21,401,564 5,350,000 Bristol-Myers Squibb Co.......................................... 08/15/08 4.000 5,355,725 4,300,000 Caterpillar Financial Services Corp.............................. 07/15/08 2.700 4,299,302 6,650,000 Caterpillar Financial Services Corp.............................. 08/15/08 3.700 6,654,411 5,100,000 Citicorp......................................................... 11/15/08 6.375 5,148,036 3,445,000 ConocoPhillips Co................................................ 03/30/09 6.375 3,532,346 4,300,000 Credit Suisse USA, Inc........................................... 01/15/09 3.875 4,321,177 3,900,000 Fleet National Bank.............................................. 01/15/09 5.750 3,955,151 2,100,000 General Electric Capital Corp.(1)................................ 07/22/08 2.551 2,099,704 3,250,000 General Electric Capital Corp.(1)................................ 07/28/08 2.907 3,249,758 1,447,000 General Electric Capital Corp.................................... 10/15/08 3.600 1,442,710 3,400,000 Goldman Sachs Group, Inc.(1)..................................... 09/22/08 2.891 3,394,665 2,600,000 Goldman Sachs Group, Inc.(1)..................................... 09/23/08 2.841 2,595,570 6,247,000 Goldman Sachs Group, Inc.(1)..................................... 09/24/08 2.882 6,234,570 4,700,000 Hartford Financial Services Group, Inc........................... 08/16/08 5.550 4,712,772 12,000,000 Hartford Financial Services Group, Inc........................... 11/01/08 6.375 12,116,143 4,300,000 HSBC Finance Corp................................................ 12/15/08 4.125 4,297,649 5,850,000 John Deere Capital Corp.(1)...................................... 09/25/08 2.984 5,850,000 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 7 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- -------------- <C> <C> <C> <C> <C> CORPORATE BONDS (continued) $17,100,000 JP Morgan Chase & Co.(1)......................................... 09/22/08 2.851% $ 17,084,392 4,300,000 JP Morgan Chase & Co............................................. 10/15/08 5.750 4,312,724 4,760,000 JP Morgan Chase & Co............................................. 01/15/09 6.000 4,833,614 8,600,000 National Rural Utilities Cooperative Finance Corp. ................................................. 12/01/08 5.750 8,663,294 17,100,000 National Geographic School Publishing, Inc.(1)................... 07/03/08 2.500 17,100,000 15,800,000 Pioneer Hi-Bred International, Inc............................... 01/15/09 5.750 16,037,121 6,000,000 PNC Bank NA(1)................................................... 07/29/08 2.443 5,990,486 8,600,000 PNC Funding Corp................................................. 02/15/09 6.125 8,740,178 2,100,000 US Bancorp....................................................... 04/28/09 5.300 2,142,362 6,000,000 US Bank NA....................................................... 07/15/08 6.300 6,007,198 21,400,000 Wachovia Bank NA(1).............................................. 07/03/08 2.070 21,376,395 8,600,000 Wachovia Bank NA................................................. 12/01/08 5.800 8,686,365 4,300,000 Wells Fargo & Co.(1)............................................. 07/03/08 2.508 4,297,956 -------------- Total Corporate Bonds............................................ 253,531,649 -------------- MUNICIPAL BONDS(1) (8.0%) 4,700,000 Broward County, Florida, Airport Facility Revenue................ 07/02/08 2.510 4,700,000 12,800,000 Connecticut State Housing Finance Authority...................... 07/03/08 2.750 12,800,000 6,505,000 De Kalb County, Georgia Development Authority Revenue............ 07/02/08 2.400 6,505,000 6,900,000 Greensboro, North Carolina....................................... 07/02/08 2.550 6,900,000 12,800,000 Kansas City, Missouri, Tax Increment Financing Commission Revenue................................... 07/02/08 2.780 12,800,000 12,800,000 Michigan Municipal Bond Authority................................ 07/07/08 3.000 12,800,000 6,200,000 State of Mississippi ............................................ 07/02/08 2.510 6,200,000 28,800,000 New York City Transitional Finance Authority..................... 07/02/08 2.750 28,800,000 12,800,000 New York, New York............................................... 07/07/08 2.600 12,800,000 15,135,000 Portland, Maine.................................................. 07/02/08 2.600 15,135,000 1,635,000 Private Colleges & Universities Authority........................ 07/02/08 2.400 1,635,000 10,600,000 Savannah College of Art & Design................................. 07/03/08 2.500 10,600,000 </TABLE> The accompanying notes are an integral part of these financial statements. 8 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- -------------- <C> <C> <C> <C> <C> MUNICIPAL BONDS(1) (continued) $ 3,670,000 Seattle, Washington.............................................. 07/02/08 2.750% $ 3,670,000 30,800,000 State of Texas................................................... 07/02/08 2.750 30,800,000 8,600,000 Virginia State Housing Development Authority..................... 07/02/08 2.750 8,600,000 -------------- Total Municipal Bonds............................................ 174,745,000 -------------- MUTUAL FUND (2.6%) 57,730,000 Reserve U.S. Government Fund 12.................................. 57,730,000 -------------- U.S. GOVERNMENT AGENCY OBLIGATIONS (2.7%) 4,300,000 Federal Farm Credit Bank......................................... 06/15/09 3.950 4,361,083 4,300,000 Federal Home Loan Bank........................................... 11/21/08 4.625 4,336,028 7,940,000 Federal Home Loan Bank........................................... 04/21/09 2.350 7,928,808 8,600,000 Federal Home Loan Bank........................................... 05/07/09 2.750 8,600,000 8,600,000 Federal Home Loan Bank........................................... 05/13/09 2.375 8,586,524 11,225,000 FHLMC............................................................ 08/14/08 5.125 11,263,277 12,800,000 FHLMC............................................................ 05/18/09 2.500 12,800,000 -------------- Total U.S. Government Agency Obligations......................... 57,875,720 -------------- REPURCHASE AGREEMENTS (14.9%) 75,000,000 BNP Paribas (Agreement dated 06/30/08 collateralized by FNMA 5.500%-6.000%, due 12/01/36-02/01/38, value $76,500,000)............................................... 07/01/08 2.400 75,000,000 100,000,000 Deutsche Bank (Agreement dated 06/30/08 collateralized by FMAC 4.500%-7.000%, due 11/01/13-05/01/38, value $86,724,101 and FNMA 5.106%-5.755% due 12/01/16-12/01/35, value $15,275,899)............................................... 07/01/08 2.700 100,000,000 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 9 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- -------------- <C> <C> <C> <C> <C> REPURCHASE AGREEMENTS (continued) $75,000,000 Royal Bank of Canada (Agreement dated 06/30/08 collateralized by FAMC 4.875%, due 01/14/11, value $5,627,053; FMAC 4.000%-14.000%, due 01/14/11-06/01/38, value $18,373,822; FNMA 4.500%-16.000%, due 02/01/09-02/01/48, value 34,311,800 and GNMA 4.500%-17.000%, due 04/15/09-06/15/38, value $18,187,326)............................ 07/01/08 2.850% $ 75,000,000 75,000,000 Societe Generale (Agreement dated 06/30/08 collateralized by FMAC 6.500%, due 10/01/37, value $48,324,149; and FNMA 5.500%, due 03/01/37, value $28,175,851)..................................................... 07/01/08 2.700 75,000,000 -------------- Total Repurchase Agreements...................................... 325,000,000 -------------- TOTAL INVESTMENTS AT AMORTIZED COST............................................................. 99.8% $2,169,863,179 OTHER ASSETS IN EXCESS OF LIABILITIES........................................................... 0.2 4,034,527 ----- -------------- NET ASSETS..................................................................................... 100.0% $2,173,897,706 ===== ============== </TABLE> - ---------- (1) Variable rate instrument. Interest rates change on specific dates (such as coupon or interest payment date). The yield shown represents the June 30, 2008 coupon or interest rate. Abbreviations: FAMC - Federal Agricultural Mortgage Corporation FHLMC - Federal Home Loan Mortgage Corporation FMAC - Financial Markets Association of Canada FNMA - Federal National Mortgage Association GNMA - Government National Mortgage Association The accompanying notes are an integral part of these financial statements. 10 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- STATEMENT OF ASSETS AND LIABILITIES June 30, 2008 ASSETS: Investments, at amortized cost .......................... $1,844,863,179 Repurchase Agreements ................................... 325,000,000 Cash .................................................... 60,204 Interest and other receivables .......................... 5,396,962 -------------- Total Assets ........................................ 2,175,320,345 -------------- LIABILITIES: Payables for: Investment advisory and administrative fees ......... 477,783 Shareholder servicing fees .......................... 296,167 Dividends declared .................................. 158,637 Custody and accounting fees ......................... 138,484 Professional fees ................................... 66,992 State registration fees ............................. 13,414 Board of Trustees' fees ............................. 1,000 Accrued expenses and other liabilities .................. 270,162 -------------- Total Liabilities ................................... 1,422,639 -------------- NET ASSETS .................................................. $2,173,897,706 ============== Net Assets Consist of: Paid-in capital ......................................... $2,173,897,706 -------------- Net Assets .................................................. $2,173,897,706 ============== NET ASSET VALUE AND OFFERING PRICE PER SHARE REGULAR SHARES NET ASSET VALUE ($1,408,949,855 / 1,408,948,801 shares outstanding) ..... $1.00 ===== INSTITUTIONAL SHARES NET ASSET VALUE ($764,947,852 / 764,948,222 shares outstanding) ......... $1.00 ===== The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 11 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- STATEMENT OF OPERATIONS For the year ended June 30, 2008 NET INVESTMENT INCOME: Income: Investment income .................................. $ 106,047,058 ------------- Expenses: Investment advisory and administrative fees ........ 5,642,976 Shareholder servicing fees ......................... 3,509,603 Custody and accounting fees ........................ 331,683 Board of Trustees' fees ............................ 169,515 Professional fees .................................. 138,608 State registration fees ............................ 59,691 Miscellaneous expenses ............................. 288,005 ------------- Total Expenses .................................. 10,140,081 Expense offset arrangement ...................... (54,485) ------------- Net Expenses .................................... 10,085,596 ------------- Net Investment Income .................................. $ 95,961,462 ============= The accompanying notes are an integral part of these financial statements. 12 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- STATEMENTS OF CHANGES IN NET ASSETS <TABLE> <CAPTION> For the years ended June 30, -------------------------------------- 2008 2007 --------------- --------------- <S> <C> <C> INCREASE (DECREASE) IN NET ASSETS: From Operations: Net investment income ........................................................ $ 95,961,462 $ 86,186,394 --------------- --------------- Dividends and distributions declared: From net investment income: Regular shares ............................................................ (50,922,406) (67,612,111) Institutional shares ...................................................... (45,039,056) (18,574,283) --------------- --------------- Total dividends and distributions declared ............................ (95,961,462) (86,186,394) --------------- --------------- From Fund Share (Principal) Transactions at Net Asset Value of $1.00 per share: Fund shares sold .......................................................... 4,249,639,531 3,932,442,373 Fund shares issued in reinvestment of dividends ........................... 52,591 39,649,577 Fund shares repurchased ................................................... (4,387,608,450) (3,165,839,507) --------------- --------------- Net increase (decrease) in net assets resulting from fund share transactions ........................................ (137,916,328) 806,252,443 --------------- --------------- NET ASSETS: Beginning of year ................................................................ 2,311,814,034 1,505,561,591 --------------- --------------- End of year ...................................................................... $ 2,173,897,706 $ 2,311,814,034 =============== =============== </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 13 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS Selected per share data and ratios for a Regular share outstanding throughout each year <TABLE> <CAPTION> For the years ended June 30, -------------------------------------------------------------- 2008 2007 2006 2005 2004 ------ ------ ------ ------ ------ <S> <C> <C> <C> <C> <C> Net asset value, beginning of year ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Income from investment operations: Net investment income ..................... 0.04 0.05 0.04 0.01 0.01 Dividends to shareholders from net investment income ......................... (0.04) (0.05) (0.04) (0.01) (0.01) ------ ------ ------ ------ ------ Net asset value, end of year .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total return .................................. 3.77% 4.97% 3.76% 1.72% 0.59% Ratios/ Supplemental data: Net assets, end of year (in millions) ..... $1,409 $1,172 $1,506 $1,258 $1,375 Ratio of expenses to average net assets ... 0.51% 0.51%(1) 0.53%(1) 0.52%(1) 0.52%(1) Expense offset arrangement ................ 0.00%(2) -- -- -- -- ------ ------ ------ ------ ------ Total Expenses ........................ 0.51% 0.51% 0.53% 0.52% 0.52% ====== ====== ====== ====== ====== Ratio of net investment income to average net assets .................... 3.63% 4.79%(1) 3.75%(1) 1.70%(1) 0.59%(1) </TABLE> - ---------- (1) Ratios include the Fund's share income, expenses paid by, and the expense offset arrangement, of the BBH U.S. Money Market Portfolio, which the Fund invested in through June 12, 2007, as appropriate. (2) Less than 0.01%. The accompanying notes are an integral part of these financial statements. 14 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS (continued) Selected per share data and ratios for an Institutional share outstanding throughout the year <TABLE> <CAPTION> For the period from January 26, 2007 (commencement of For the year ended operations) through June 30, 2008 June 30, 2007 ------------------ ------------------- <S> <C> <C> Net asset value, beginning of period ........................................... $ 1.00 $ 1.00 Income from investment operations: Net investment income ...................................................... 0.04 0.02 Dividends to shareholders from net investment income ........................... (0.04) (0.02) ------ ------ Net asset value, end of period ................................................. $ 1.00 $ 1.00 ====== ====== Total return ................................................................... 4.02% 2.21%(1) Ratios/ Supplemental data: Net assets, end of period (in millions) .................................... $ 765 $1,140 Ratio of expenses to average net assets .................................... 0.26% 0.26%(2),(3) Expense offset arrangement ................................................. 0.00%(4) -- ------ ------ Total Expenses ......................................................... 0.26% 0.26% ====== ====== Ratio of net investment income to average net assets ..................................................... 3.86% 5.07%(2),(3) </TABLE> - ---------- (1) Inception to date return. (2) Ratios include the Fund's share income, expenses paid by, and the expense offset arrangement, of the BBH U.S. Money Market Portfolio, which the Fund invested in through June 12, 2007, as appropriate. (3) Annualized. (4) Less than 0.01%. The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 15 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS June 30, 2008 1. Organization and Significant Accounting Policies. BBH Money Market Fund (the "Fund") is a separate, diversified series of BBH Trust (the "Trust"), which is registered under the Investment Company Act of 1940, as amended. The Trust is an open-end management investment company organized as a Massachusetts business trust on June 7, 1983 and re-organized as a Delaware statutory trust on June 12, 2007. The Fund commenced operations on December 12, 1983. The Declaration of Trust permits the Trustees to create an unlimited number of series, each of which may issue a separate class of shares. The Fund established a new class of shares designated as "Institutional Shares". Institutional Shares opened on December 19, 2006 and commenced operations on January 26, 2007. Regular Shares and Institutional Shares have different operating expenses. At June 30, 2008, there were seven series of the Trust. Prior to June 12, 2007 the Fund invested all of its investable assets in the BBH U.S. Money Market Portfolio (the "Portfolio"), a diversified, open-end management investment company having the same investment objectives as the Fund. Effective June 12, 2007, the Fund redeemed its shares of the Portfolio and began investing its assets directly. There were no changes to the Fund's investment policies and restrictions. The Fund recorded its share of the Portfolios' income and expenses daily until the date of the redemption. The Fund's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements and are based, in part, on the following accounting policies. Actual results could differ from those estimates. A. Valuation of Investments. The Fund values its investments at amortized cost, which approximates market value. The amortized cost method values a security at its cost at the time of purchase and thereafter assumes a constant amortization to maturity of any discount or premium. The Fund's use of amortized cost is in compliance with Rule 2a-7 of the Investment Company Act of 1940. B. Investment Transactions and Income. Investment transactions are accounted for on the trade date. Realized gains and losses, if any, from investment transactions are determined on the basis of identified cost. Interest income consists of interest accrued and discount earned (including both original issue and market discount) and premium amortization on the investments of the Fund, accrued ratably to the date of maturity. C. Repurchase Agreements. The Fund may enter into repurchase agreements with primary dealers of U.S. Government Obligations as designated by the Federal Reserve Bank of New York. Repurchase agreements are transactions in which the Fund buys a security from a dealer or bank and agrees to sell the security back at a mutually agreed upon time and price. The repurchase price 16 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 exceeds the sale price, reflecting the Fund's return on the transaction or effectively the interest rate paid by the dealer to the Fund. This return is unrelated to the interest rate on the underlying security. The Fund will enter into repurchase agreements only with banks and other recognized financial institutions, such as securities dealers, deemed creditworthy by the Investment Adviser. The Fund's custodian or sub-custodian will take possession of the securities subject to repurchase agreements. The Investment Adviser or sub-custodian will monitor the value of the underlying security each day to ensure that the value of the security always equals or exceeds the repurchase price. Repurchase agreements are subject to credit risks. Information regarding repurchase agreements is included in the Portfolio of Investments. D. Federal Income Taxes. Each series of the Trust is treated as a separate entity for federal income tax purposes. It is the Fund's policy to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. At June 30, 2008, the cost of investments for federal income tax purposes was equal to the amortized cost of investments for financial statement purposes. E. Dividends and Distributions to Shareholders. Dividends from net investment income are declared daily and paid monthly to shareholders. The Fund declared dividends in the amounts of $50,922,406 and $45,039,056 to Regular and Institutional shareholders, respectively, during the year ended June 30, 2008. The Fund declared dividends in the amount of $67,612,111 and $18,574,283 to Regular and Institutional shareholders during the year ended June 30, 2007. The tax character of the dividends declared in both years was 100% ordinary income. The Fund had a net capital loss carryforward of approximately $39,121 which expires as follows: Expiration date Amount --------------- ------ 06/30/2016 $39,121 ======= The differences between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to the tax deferral of losses on wash sales and post-October short term capital loss deferral. To the extent that this net capital loss carryover is used to offset future capital gains, it is probable the gains to offset will not be distributed to shareholders since any such distributions may be taxable to shareholders as ordinary income. FINANCIAL STATEMENT JUNE 30, 2008 17 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 F. Accounting Developments. In June 2006, the Fund adopted FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. The adoption of FIN 48 had no impact on the operations of the Fund for the period ended June 30, 2008. In September 2006, Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS 157), was issued and is effective for fiscal years beginning after November 15, 2007. SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. Management is currently evaluating the implication of SFAS 157. At this time its impact on the Fund's financial statements has not yet been determined. In March 2008, Statement of Financial Accounting Standards No. 161, Disclosures about Derivative Instruments and Hedging Activities (SFAS 161), was issued and is effective for fiscal years beginning after November 15, 2008. SFAS 161 requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. Management is currently evaluating the impact the adoption of SFAS 161 will have on the Fund's financial statement disclosures. 2. Transactions with Affiliates. Investment Advisory and Administrative Fees. Effective June 12, 2007, under a combined Investment Advisory and Administrative Services Agreement ("Agreement") with the Trust, a separately identifiable department within Brown Brothers Harriman & Co. ("BBH") provides investment advice, portfolio management and administrative services to the Fund. BBH receives a combined fee from the Fund for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.25% on the first $1,000,000,000 of the Fund's average daily net assets and 0.20% of the Fund's average daily net assets in excess of $1,000,000,000. Prior to June 12, 2007, under a separate agreement that covered only investment advisory fees, BBH received a fee from the Fund calculated daily and paid monthly. This fee was allocated to the Fund from the Portfolio in which the Fund invested and was calculated at an annual rate of 0.15% of the Portfolio's average daily net assets. Brown Brothers Harriman Trust Company, LLC, the Fund's administrator, under a separate agreement that covered only administrative services, received a fee from the Fund calculated daily and paid 18 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 monthly at an annual rate equivalent to 0.10% of the Fund's average daily net assets. BBH has a sub-administration services agreement with Federated Services Company ("FSC") for which FSC receives compensation paid by BBH. For the year ended June 30, 2008, the Fund incurred $5,642,976 for investment advisory and administrative services. Shareholder Servicing Fees. The Trust has a shareholder servicing agreement with BBH for which BBH receives a fee from the Fund calculated daily and paid monthly at an annual rate of 0.25% of the Regular shares' average daily net assets. For the year ended June 30, 2008, the Fund incurred $3,509,603 for shareholder servicing services. Custody and Accounting Fees. BBH acts as a custodian and shall receive a custody and accounting fee from the Fund calculated daily and paid monthly. The custody fee is a transaction based fee with an annual minimum of $20,000, and the accounting fee is calculated at 0.01% per annum on the first $1 billion of net assets and 0.005% per annum on all net assets over $1 billion. For the year ended June 30, 2008, the Fund incurred $331,683 for custody and accounting services. These fees were reduced by $54,485 as a result of an expense offset arrangement with the Fund's custodian. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to the agreement the Fund will be charged interest based on LIBOR on the day of the overdraft plus one percent. The total interest paid by the Fund for the year ended June 30, 2008 was $18,236. Board of Trustees' Fees. Each Trustee receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the year ended June 30, 2008, the Fund incurred $169,515 for Trustees' fees. 3. Capital Stock. The Trust is permitted to issue an unlimited number of Regular Shares and Institutional Shares of capital stock, at no par value. Transactions in shares of capital stock were as follows: Shares -------------------------------- For the For the year ended year ended June 30, 2008 June 30, 2007 ------------- ------------- Regular Shares Capital stock sold ........................ 2,213,057,812 2,210,338,409 Capital stock issued in connection with reinvestment of dividends ............. 52,591 31,844,261 Capital stock redeemed .................... (1,976,287,295) (2,575,617,884) -------------- -------------- Net increase (decrease) ................... 236,823,108 (333,435,214) ============== ============== FINANCIAL STATEMENT JUNE 30, 2008 19 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 Shares ------------------------------------ For the period from January 26, 2007 For the (commencement of year ended operations) to June 30, 2008 June 30, 2007 --------------- ------------------- Institutional Shares Capital stock sold ....................... 2,036,581,719 1,722,103,964 Capital stock issued in connection with reinvestment of dividends ............ -- 7,805,316 Capital stock redeemed ................... (2,411,321,155) (590,221,623) -------------- -------------- Net increase (decrease) .................. (374,739,436) 1,139,687,657 ============== ============== 20 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- DISCLOSURE OF FUND EXPENSES June 30, 2008 EXAMPLE As a shareholder of BBH Money Market Fund (the "Fund"), you may incur two types of costs: (1) transaction costs on purchase payments, reinvested dividends, or other distributions; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2008 to June 30, 2008). ACTUAL EXPENSES The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During the Period" to estimate the expenses you paid on your account during the period. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. FINANCIAL STATEMENT JUNE 30, 2008 21 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- DISCLOSURE OF FUND EXPENSES (continued) June 30, 2008 Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. <TABLE> <CAPTION> Expenses Paid Beginning Ending During Period Account Value Account Value January 1, 2008 January 1, 2008 June 30, 2008 to June 30, 2008(1) --------------- ------------- ------------------- <S> <C> <C> <C> Regular Shares Actual................................. $1,000 $1,013.80 $2.55 Hypothetical(2)........................ $1,000 $1,022.33 $2.56 </TABLE> <TABLE> <CAPTION> Expenses Paid Beginning Ending During Period Account Value Account Value January 1, 2008 January 1, 2008 June 30, 2008 to June 30, 2008(1) --------------- ------------- ------------------- <S> <C> <C> <C> Institutional Shares Actual................................. $1,000 $1,015.10 $1.30 Hypothetical(2)........................ $1,000 $1,023.57 $1.31 </TABLE> - ---------- (1) Expenses are equal to the Fund's annualized expense ratio of 0.51% and 0.26% for Regular and Institutional shares, respectively, multiplied by 182/366 (to reflect the one half-year period). (2) Assumes a return of 5% before expenses. For the purpose of the calculation, the applicable annualized expense ratio for each class of shares is subtracted from the assumed return before expenses. 22 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION June 30, 2008 Approval of Investment Advisory/Administrative Services Agreement At a meeting held on December 11, 2006, the Board of Trustees (the "Board") of the Trust unanimously approved a new Combined Investment Advisory/Administrative Services Agreement ("Combined Agreement"). The Board determined that the terms of the Combined Agreement will be substantially identical to those of the current advisory and administration agreements of the Funds, noting that the most significant difference in the Combined Agreement is a single fee for both investment advisory and administrative services. The following is a summary of the factors the Board took into consideration in making its determination to approve the new Combined Agreement. Nature, Extent and Quality of Services Provided by Brown Brothers Harriman & Co. ("BBH") The Board noted that, under the Combined Agreement in respect of each Fund, BBH, subject to the supervision of the Board, will be responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Funds' investment objective and policies. Under the Combined Agreement, BBH also provides administrative services to each Fund. The Board considered the scope and quality of services to be provided by BBH under the Combined Agreement and noted that the scope of services provided had expanded over time, primarily, as a result of regulatory developments. The Board noted that, for example, BBH is responsible for maintaining and monitoring its own and, to varying degrees, the Funds' compliance program, and these compliance programs had recently been refined and enhanced in light of new regulatory requirements. The Board considered the quality of the investment research and administrative capabilities of BBH and the other resources it has dedicated to performing services for the Funds. The Board concluded that, overall, they were satisfied with the nature, extent and quality of services expected to be provided to each of the Funds under the Combined Agreement. Costs of Services Provided and Profitability to BBH At the request of the Board, BBH provided information concerning the profitability of BBH's current investment company advisory and other fees. The Board also reviewed BBH's profitability data for each Fund, which also included the effect of revenue generated by the shareholder servicing, administration, custody and other fees paid by the Fund. The Board discussed the difficulty of making comparisons of profitability because comparative information is not generally publicly available and is affected by numerous factors, including the structure of the service provider, the types of funds it manages and administers, its business mix, numerous assumptions regarding allocations and the entity's capital structure and cost of capital. In considering profitability information, the Board considered the effect of fall-out benefits on BBH's expenses, as well as the "revenue sharing" arrangements BBH has entered into with certain entities that distribute shares of the Funds. The Board focused on profitability of BBH's relationships with the Funds before taxes and distribution expenses. The Board concluded that it was satisfied that BBH's level of profitability from its relationship with each Fund was not excessive. FINANCIAL STATEMENT JUNE 30, 2008 23 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 Fall-Out Benefits The Board considered that BBH does not allocate the Funds' portfolio transactions for third party research, although it did benefit from proprietary research received from brokers that execute the Funds' purchases and sales of securities. The Board recognized that the aggregate amount of commissions generated by Fund transactions was unlikely to result in the Funds receiving from full service broker dealers substantial discounts on commission rates. The Board received and reviewed information concerning BBH's policies with respect to allocating portfolio brokerage. The Board also considered that BBH receives shareholder servicing fees from certain funds, and is the Funds' administrator, custodian and securities lending agent. The Board noted that BBH retained no portion of the 12b-1 fees paid by any Fund that operated with a Rule 12b-1 plan. The Board recognized that BBH's profitability would be somewhat lower if it did not receive proprietary research for commissions or, if it did not receive the other benefits described above. The Board recognized that most Fund shareholders were also BBH clients, and that substantial assets are invested in the Funds as a result of an overall investment management program for the shareholder. The Board noted that the Funds also derive reputational and other benefits from their association with BBH and their use of the BBH name, which is licensed to the Funds by BBH. Thus, the Board did not believe that BBH revenues associated with its clients should be fairly regarded as "fallout" benefit from the Funds. Economies of Scale The Board noted that the Funds' combined fee schedules, other than the fee schedule for BBH Money Market Fund, do not contain breakpoints. As a result, if assets increase, the fee rates would not be reduced for these Funds on the incremental assets. With respect to the BBH Money Market Fund, the breakpoint will be reviewed every three (3) years by the Board, and may be adjusted upwards to take into account the effects of inflation or such other basis as may be appropriate, subject to the approval of shareholders to the extent required by the 1940 Act. There may be other economies of scale because many expenses did not rise (and fall) proportionally to increases (and decreases) in total net assets. The Board noted that BBH had priced its services in recognition of the fact that it was largely its own clients who were shareholders and, accordingly, sought to assure that the cost of these services and total expenses for each Fund were fair and reasonable. In addition, the Board noted that over the years BBH had supported certain Funds through fee waivers and expense reimbursements. Based on information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Funds, there appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints (if any) apply. In light of the Funds' current size and expense structure, the Board concluded that it was unnecessary at this time to consider breakpoints with respect to the Funds, other than for the BBH Money Market Fund. 24 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 Investment Results The Board considered the investment results of each of the Funds as compared to investment companies with its peers and with one or more selected securities indices. In addition to the information received by the Board for the meeting held on December 11, 2006, the Board received detailed performance information for each Fund at each regular Board meeting during the year. At the meeting held on October 2, 2006, the Board reviewed information showing performance of each Fund compared to its peers over the prior 1-, 3-, and 5- year periods and compared the performance information to one or more securities indices over comparable periods. Combined Fee Rate The Board considered the fee rate to be paid by each Fund to BBH. The Board recognized that it is difficult to make comparisons of these fee rates, and the combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board considered the depth and range of services provided under the Combined Agreement. For example, in addition to a continuous investment program, BBH provides, among other things, officers (including the Funds' Chief Compliance Officer and officers to provide required certifications) and administrative services, such as shareholder communications, and tax compliance, with the attendant costs and exposure to liability. BBH also coordinates the provision of services to the Funds by nonaffiliated service providers. The following factors specific to BBH Money Market Fund also were noted and considered by the Board in deciding to approve the Combined Agreement: The Board reviewed information showing performance of the BBH Money Market Fund compared to other funds in the iMoneyNet (1st Tier Retail) and (1st Tier Institutional). The comparative information showed that the BBH Money Market Fund had outperformed or performed in line with the averages over all relevant periods. The Board also viewed with favor that the total expense ratio was substantially lower than the averages in these categories. The Board also noted that the BBH Money Market Fund had maintained a stable net asset value of one dollar at all times. Taking into account these comparisons and the other factors considered, the Board concluded that the BBH Money Market Fund's investment results over time and expense ratios had been satisfactory. Conflicts of Interest As a general matter, certain conflicts of interest may arise in connection with a portfolio manager's management of a Fund's investments, on the one hand, and the investments of other accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various accounts managed could have different investment strategies that, at times, might conflict with one another to the FINANCIAL STATEMENT JUNE 30, 2008 25 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 possible detriment of the Fund. Alternatively, to the extent that the same investment opportunities might be desirable for more than one account, possible conflicts could arise in determining how to allocate them. Other potential conflicts might include conflicts created by specific portfolio manager compensation arrangements, and conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades (for example, research, or "soft dollars"). BBH has adopted and implemented policies and procedures, including brokerage and trade allocation policies and procedures, which it believes address the conflicts associated with managing multiple accounts for multiple clients. In addition, BBH monitors a variety of areas, including compliance with account investment guidelines, the inclusion only of securities approved for purchase by the BBH's Fixed Income Credit Committee, and compliance with the BBH's Code of Ethics. Finally, BBH has structured the portfolio managers' compensation in a manner, and the Funds have adopted policies and procedures, reasonably designed to safeguard a Fund from being negatively affected as a result of any such potential conflicts. 26 <PAGE> BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- ADDITIONAL FEDERAL TAX INFORMATION June 30, 2008 In January 2009, the Fund will report on Form 1099 the tax status of all distributions made during the calendar year 2008. Shareholders should use the information on Form 1099 for their income tax returns. FINANCIAL STATEMENT JUNE 30, 2008 27 <PAGE> TRUSTEES AND OFFICERS OF BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- (unaudited) Information pertaining to the Trustees of the BBH Trust (the "Trust") and executive officers of the Trust is set forth below. Part B to the Registration Statement of the BBH Money Market Fund includes additional information about the Fund's Trustees and is available upon request without charge by contacting the Fund at 1-800-625-5759. <TABLE> <CAPTION> Term of Number of Office Funds in and Fund Other Position(s) Length Complex Directorships Name, Birth Date Held with of Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - ------------------------------------------------------------------------------------------------------------------------------------ <S> <C> <C> <C> <C> <C> Joseph V. Shields Jr. Chairman of the Since 2007 Managing Director, Chairman and Chief 7 None Birth Date: Board and Trustee Executive Officer of Shields & Company March 17, 1938 (member of New York Stock Exchange); Shields & Company Chairman of Capital Management 140 Broadway Associates, Inc. (registered investment New York, NY 10005 adviser); Director of Flower Foods, Inc. (New York Stock Exchange listed company). David P. Feldman Trustee Since 2007 Director of Jeffrey Co. (1992 to 7 Director of Birth Date: present); Director of QMED (1999 to May Dreyfus Mutual November 16, 1939 2007). Funds (59 Funds) C/O BBH & Co. 140 Broadway New York, NY 10005 Alan G. Lowy Trustee Since 2007 Private Investor. 7 None Birth Date: April 17, 1939 4111 Clear Valley Drive Encino, CA 91436 Arthur D. Miltenberger Trustee Since 2007 Retired; Trustee, R.K. Mellon Family 7 None Birth Date: Trust (1981 to June 2003); Director of November 8, 1938 Aerostructures Corporation (aircraft 503 Darlington Road manufacturer) (1996 to July 2003). Ligonier, PA 15658 Samuel F. Pryor, IV Trustee Since 2007 Private Investor. 7 None Birth Date: June 12, 1955 130 East 67th Street New York, NY 10021 </TABLE> 28 <PAGE> TRUSTEES AND OFFICERS OF BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- (unaudited) <TABLE> <CAPTION> Term of Number of Office Funds in and Fund Other Position(s) Length Complex Directorships Name, Birth Date Held with of Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - ------------------------------------------------------------------------------------------------------------------------------------ <S> <C> <C> <C> <C> <C> H. Whitney Wagner Trustee Since 2007 President, Clear Brook Advisors, a 7 None Birth Date: registered investment advisor. March 3, 1956 Clear Brook Advisors 75 Rockefeller Plaza, 14th Floor New York, NY 10019 Officers John A. Gehret President and Since 2008 President and Principal Executive N/A N/A Birth Date: Principal Officer of the Trust; Joined Brown April 11, 1959 Executive Officer Brothers Harriman & Co. ("BBH & Co.") 140 Broadway in 1981 and has been a Partner of the New York, NY 10005 firm since 1998. Charles H. Schreiber Treasurer and Since 2007 Treasurer and Principal Financial N/A N/A Birth Date: Principal Officer of the Trust; Senior Vice December 10, 1957 Financial Officer President of BBH & Co. since September 140 Broadway 2001; Joined BBH & Co. in 1999. New York, NY 10005 Mark B. Nixon Assistant Since 2007 Assistant Secretary and Assistant N/A N/A Birth Date: Secretary, Treasurer of the Trust; Vice President January 14, 1963 Assistant of BBH & Co. (since October 2006); 140 Broadway Treasurer Accounting Manager, Reserve Funds New York, NY 10005 (August 2005-September 2006); Assistant Controller, Reserve Funds (February 2005-August 2005); Private Consultant (December 2001-February 2005). Beth Haddock Chief Compliance Since 2007 Chief Compliance Officer of the Trust N/A N/A Birth Date: Officer (September 2007-present); Chief December 10, 1965 Compliance Officer for the FINRA/NYSE 140 Broadway and SEC compliance programs and New York, NY 10005 Associate Compliance Director for the global compliance program (April 2005-present); Deputy General Counsel of AXA Advisors/AXA Financial (November 1997-April 2005). </TABLE> FINANCIAL STATEMENT JUNE 30, 2008 29 <PAGE> TRUSTEES AND OFFICERS OF BBH MONEY MARKET FUND - -------------------------------------------------------------------------------- (unaudited) <TABLE> <CAPTION> Term of Number of Office Funds in and Fund Other Position(s) Length Complex Directorships Name, Birth Date Held with of Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - ------------------------------------------------------------------------------------------------------------------------------------ <S> <C> <C> <C> <C> <C> Sue M. Rim-An Anti-Money Since 2008 Anti-Money Laundering Officer, Vice N/A N/A Birth Date: Laundering Officer President of BBH & Co. (September 2007 September 10, 1970 - present); AML Officer at UBS 140 Broadway Investment Bank (April 2006 - August New York, NY 10005 2007); AML Officer & Vice President in Private Client Services at Bear Stearns & Co (June 1992 - April 2006). Gail C. Jones Secretary Since 2007 Secretary of the Trust; Counsel, N/A N/A Birth Date: ReedSmith, LLP (since October 2002); October 26, 1953 Corporate Counsel (January 1997 to 1001 Liberty Avenue September 2002) and Vice President Pittsburgh, PA (January 1999 to September 2002) of 15222-3779 Federated Services Company. George M. Polatas Vice President Since 2008 Vice President of the Trust (since June N/A N/A Birth Date: 2008); Assistant Vice President of March 3, 1962 Federated Services Company; Vice 1001 Liberty Avenue, President of various funds distributed Pittsburgh, PA by Edgewood Services, Inc (January 1997 15222-3779 to present). Theodore J. Boudria Assistant Since 2008 Assistant Treasurer of the Trust; Vice N/A N/A Birth Date: Treasurer President (since 2003); Assistant Vice June 26, 1968 President (since September 2000); 70 Franklin Street Joined BBH & Co. in 1995. Boston, MA 02110 </TABLE> - ---------- # Each Trustee of the Trust holds office until he or she attains the age of 70 (72, in the case of Trustees who were elected as such before January 1, 2000), or until he or she sooner dies, resigns or is removed from office in accordance with the provisions of the Trust's Declaration of Trust. All officers of the Trust hold office for one year and until their respective successors are chosen and qualified (subject to the ability of the Trustees to remove any officer in accordance with the Trust's By-laws). ^ The Fund Complex consists of the Trust, which has seven series and each is counted as one "Fund" for purposes of this table. 30 <PAGE> INVESTMENT ADVISER AND ADMINISTRATOR BROWN BROTHERS HARRIMAN 140 BROADWAY NEW YORK, NY 10005 DISTRIBUTOR EDGEWOOD SERVICES, INC. 5800 CORPORATE DRIVE PITTSBURGH, PA 15237-7000 SHAREHOLDER SERVICING AGENT BROWN BROTHERS HARRIMAN 140 BROADWAY NEW YORK, NY 10005 (800) 625-5759 To obtain information or make shareholder inquiries: By telephone: Call 1-800-575-1265 By E-mail send your request to: bbhfunds@bbh.com On the internet: www.bbhfunds.com This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund. Such offering is made only by the prospectus, which includes details as to offering price and other material information. The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." Information on Form N-Q is available without charge and upon request by calling the Funds at the toll-free number listed above. A text only version can be viewed online or downloaded from the SEC's website at http://www.sec.gov; and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC (call 1-800-SEC-0330 for information on the operation of the Public Reference Room). You may also access this information from the BBH website at BBH.com by clicking on "BBH Mutual Funds" and selecting "Online Documents/Holdings Information." A copy of the Fund's Proxy Voting Policy is available upon request by calling the toll-free number listed above. A text-only version of the policy can be viewed online or downloaded from the SEC at www.sec.gov. BROWN [LOGO] BROTHERS HARRIMAN BROWN [LOGO] BROTHERS HARRIMAN Annual Report JUNE 30, 2008 BBH TAX EXEMPT MONEY FUND <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- MANAGEMENT'S DISCUSSION OF FUND PERFORMANCE For the period of July 1, 2007 to June 30, 2008, the BBH Tax Exempt Money Market Fund (the "Fund") produced a total return of 2.40%(1). We believe the performance of the Fund was competitive within the industry despite a conservative portfolio composition and in light of very difficult market conditions. The Municipal market struggled over the past year as the credit crisis caused a "flight to quality" trade in the marketplace. Investors sought safety from volatile financial market conditions which put pressure on every fixed income asset class except Treasuries. Municipal ratios relative to Treasuries increased to historically wide levels. In late February, investors could buy AAA tax exempt bonds yielding 150% of Treasuries inside 5 years. During the second quarter, the tax exempt market outperformed Treasuries, as historically wide ratios drew a wide range of strategic and tactical investors. Strong demand from retail investors, large inflows into tax exempt mutual funds, and interest from non-traditional investors contributed to the significant ratio compression and outperformance. New municipal issuance volume for the year is on track to set another record. The percentage of new issue coming to market with insurance is down over 25% from the previous year. Headline risk for monoline insurance companies was a major theme for the tax exempt market this year. The three major rating agencies downgraded all but two of the bond insurance companies. In June S&P and Moody's stripped MBIA and Ambac, the two largest monoline insurance companies, of their AAA ratings. Tax Exempt Money Market funds were hard pressed to find high quality variable rate demand note weekly and daily floaters as monoline insurance downgrades caused portfolio mangers to sell lower rated insured paper and trim their overall exposure to specific insured credits. As a result, municipal yields fell to 1.00% for high quality uninsured variable rate demand notes. Due to solid demand from retail and institutional investors, yields in the short end of the municipal yield curve fell over the past 6 months. Tax-exempt 30-day rates fell from 2.00% to 1.50%, 60-day yields fell from 2.05% to 1.55%, 90-day rates fell from 2.15% to 1.60%, and 1-year yields fell 110 basis points, from 2.80% to 1.70%. Throughout the fiscal year we maintained the Fund's positions and added new issues when we saw attractive buying opportunities. The Fund's average maturity remained at 46 days, while coupon payments and maturities were reinvested into high quality short municipals and tax-exempt commercial paper. The Fund remains well diversified with 30% in AAA-rated short-term municipals, 17% in tax-exempt commercial paper, 36% in weekly floaters, and 16% in daily cash floaters. The Fund's investment advisor remains cautious on the municipal market due to the expected new issue supply and low absolute returns offered by money market investments. High quality money market instruments are in great demand due to the downgrades, and negative outlook, on the monoline insurance companies. We continue to believe that the municipal market represents an attractive long term buying opportunity. Our purchases in the Fund are focused on municipalities with strong underlying credit fundamentals, independent of any support from bond insurance. - ---------- (1) Performance data quoted represents no guarantee of future results. Investment return and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Mutual Fund performance changes over time and current performance may be lower or higher than what is stated. For current to the most recent month end performance and after tax returns, contact the Fund at 1-800-625-5759. 2 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM June 30, 2008 To the Trustees of the BBH Trust and Shareholders of BBH Tax Exempt Money Fund We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of BBH Tax Exempt Money Fund (a series of BBH Trust) (the "Fund") as of June 30, 2008, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Fund is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of June 30, 2008, by correspondence with the custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of BBH Tax Exempt Money Fund as of June 30, 2008, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. Deloitte & Touche LLP Boston, Massachusetts August 21, 2008 FINANCIAL STATEMENT JUNE 30, 2008 3 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO ALLOCATION June 30, 2008 BREAKDOWN BY BOND TYPE Percent of U.S. $ Value Net Assets ------------ ---------- Certificates of Participation .................. $ 8,545,000 1.6% Education ...................................... 124,265,000 22.7 General Obligations ............................ 145,269,556 26.6 Government Collateral .......................... 28,759,224 5.3 Health Care .................................... 52,600,000 9.6 Industrial ..................................... 3,000,000 0.5 Miscellaneous .................................. 31,796,759 5.8 Transportation ................................. 21,987,521 4.0 Utilities ...................................... 20,965,000 3.8 Water/Sewer .................................... 24,912,128 4.6 Commercial Paper ............................... 72,515,000 13.3 Other Assets in Excess of Liabilities .......... 11,962,086 2.2 ------------ ----- NET ASSETS ..................................... $546,577,274 100.0% ============ ===== TOP FIVE HOLDINGS BY STATE Percent of U.S. $ Value Net Assets ------------ ---------- North Carolina ................................. $ 80,751,021 14.8% Texas .......................................... 51,992,635 9.5 Pennsylvania ................................... 32,100,000 5.9 Missouri ....................................... 29,700,000 5.4 Washington ..................................... 28,453,542 5.2 Other States ................................... 311,617,990 57.0 Other Assets in Excess of Liabilities .......... 11,962,086 2.2 ------------ ----- NET ASSETS ..................................... $546,577,274 100.0% ============ ===== All data as of June 30, 2008. The Fund's breakdown by bond type and top five holdings by state are expressed as a percentage of net assets and may vary over time. The accompanying notes are an integral part of these financial statements. 4 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (84.5%) CERTIFICATES OF PARTICIPATION(1) (1.6%) $ 3,475,000 Mecklenburg County, North Carolina............. 07/03/08 1.550% $ 3,475,000 1,570,000 Winston-Salem, North Carolina.................. 07/03/08 1.440 1,570,000 3,500,000 Winston-Salem, North Carolina.................. 07/03/08 1.440 3,500,000 ------------ Total Certificates of Participation............ 8,545,000 ------------ EDUCATION (22.7%) 7,000,000 Colorado Springs, Colorado(1).................. 07/01/08 2.900 7,000,000 4,000,000 Connecticut State Health & Educational Facilities Authority(1)..................... 07/02/08 1.270 4,000,000 2,850,000 Delaware State Economic Development Authority(1)................................ 07/03/08 1.550 2,850,000 2,000,000 Massachusetts State Health & Educational Facilities Authority(1)......... 07/02/08 1.280 2,000,000 2,000,000 Massachusetts State Health & Educational Facilities Authority(1)......... 07/02/08 1.450 2,000,000 3,000,000 Massachusetts State Health & Educational Facilities Authority(1)......... 07/03/08 1.470 3,000,000 2,500,000 Missouri State Health & Educational Facilities Authority(1)..................... 07/01/08 1.700 2,500,000 1,000,000 Missouri State Health & Educational Facilities Authority(1)..................... 07/01/08 1.850 1,000,000 6,200,000 Missouri State Health & Educational Facilities Authority(1)..................... 07/01/08 2.100 6,200,000 5,000,000 Missouri State Health & Educational Facilities Authority(1)..................... 07/01/08 2.600 5,000,000 5,000,000 Missouri State Health & Educational Facilities Authority(1)..................... 07/01/08 7.000 5,000,000 5,000,000 New Hampshire Health & Education Facilities Authority(1)..................... 07/02/08 1.550 5,000,000 5,000,000 North Carolina Educational Facilities Finance Agency(1)........................... 07/03/08 1.450 5,000,000 2,535,000 North Carolina Educational Facilities Finance Agency(1)........................... 07/03/08 1.510 2,535,000 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 5 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) EDUCATION (continued) $ 5,000,000 Ohio State Higher Educational Facilities Revenue(1).................................. 07/02/08 1.500% $ 5,000,000 2,000,000 Ohio State University(1)....................... 07/02/08 1.370 2,000,000 3,000,000 Pennsylvania State Higher Educational Facilities Authority(1)..................... 07/01/08 8.000 3,000,000 4,400,000 Pennsylvania State Higher Educational Facilities Authority(1)..................... 07/03/08 1.550 4,400,000 1,400,000 Pennsylvania State University(1)............... 07/03/08 1.510 1,400,000 2,900,000 Private Colleges & Universities Authority(1)................................ 07/02/08 1.600 2,900,000 4,400,000 Purdue University(1)........................... 07/02/08 1.600 4,400,000 1,645,000 University of Houston(1)....................... 07/03/08 1.600 1,645,000 4,000,000 University of Massachusetts Building Authority(1)....................... 07/02/08 1.450 4,000,000 1,500,000 University of Michigan(1)...................... 07/01/08 3.000 1,500,000 1,735,000 University of Michigan(1)...................... 07/03/08 1.500 1,735,000 6,000,000 University of Missouri(1)...................... 07/01/08 1.700 6,000,000 6,000,000 University of Pittsburgh(1).................... 07/02/08 1.520 6,000,000 6,000,000 University of Pittsburgh(1).................... 07/03/08 1.500 6,000,000 1,100,000 University of Utah(1).......................... 07/02/08 1.600 1,100,000 4,500,000 Utah State Board of Regents.................... 07/01/08 4.000 4,500,000 5,600,000 Utah State Board of Regents(1)................. 07/01/08 7.000 5,600,000 4,000,000 Virginia College Building Authority, Educational Facilities Revenue(1)........... 07/01/08 2.710 4,000,000 6,000,000 Waco Educational Finance Corp.(1).............. 07/02/08 1.600 6,000,000 ------------ Total Education................................ 124,265,000 ------------ GENERAL OBLIGATIONS (26.6%) 1,145,000 Anne Arundel County, Maryland.................. 04/01/09 4.000 1,163,213 2,310,000 Anne Arundel County, Maryland.................. 04/01/09 4.000 2,346,743 1,190,000 Arlington, Texas............................... 08/15/08 5.000 1,194,442 1,850,000 Charlotte, North Carolina...................... 07/01/08 4.250 1,850,000 1,265,000 Columbus, Ohio................................. 07/01/08 5.000 1,265,000 </TABLE> The accompanying notes are an integral part of these financial statements. 6 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) GENERAL OBLIGATIONS (continued) $ 1,800,000 State of Delaware.............................. 07/01/08 5.000% $ 1,800,000 500,000 State of Delaware.............................. 03/01/09 4.250 508,569 4,795,000 Denton, Texas, Independent School District(1).......................... 07/03/08 1.550 4,795,000 1,100,000 Durham, North Carolina(1)...................... 07/03/08 1.570 1,100,000 1,000,000 Fairfax County, Virginia....................... 04/01/09 5.250 1,023,632 2,500,000 State of Georgia............................... 12/01/08 5.000 2,533,832 3,250,000 State of Georgia............................... 12/01/08 5.000 3,286,836 1,025,000 Greensboro, North Carolina(1).................. 07/02/08 1.520 1,025,000 1,675,000 Greensboro, North Carolina(1).................. 07/02/08 1.520 1,675,000 2,520,000 Greensboro, North Carolina..................... 03/01/09 5.250 2,575,703 3,015,000 Guilford County, North Carolina(1)............. 07/03/08 1.550 3,015,000 3,100,000 Howard County, Maryland........................ 02/15/09 4.000 3,141,990 3,025,000 Howard County, Maryland........................ 02/15/09 4.250 3,068,660 1,050,000 Katy, Texas, Independent School District(1)................................. 07/03/08 1.530 1,050,000 1,500,000 Lehman Municipal Trust Receipts(1)............. 07/02/08 1.770 1,500,000 2,560,000 State of Maryland.............................. 08/01/08 5.000 2,562,845 5,000,000 State of Maryland.............................. 02/01/09 5.000 5,100,718 1,000,000 State of Maryland.............................. 03/01/09 5.250 1,021,299 2,455,000 State of Massachusetts(1)...................... 07/02/08 1.530 2,455,000 1,000,000 Mecklenburg County, North Carolina(1).......... 07/02/08 1.570 1,000,000 1,200,000 Mecklenburg County, North Carolina(1).......... 07/02/08 1.570 1,200,000 2,450,000 Mecklenburg County, North Carolina(1).......... 07/02/08 1.570 2,450,000 3,450,000 Mecklenburg County, North Carolina(1).......... 07/02/08 1.570 3,450,000 1,060,000 Mecklenburg County, North Carolina(1).......... 07/03/08 1.450 1,060,000 2,500,000 Mecklenburg County, North Carolina(1).......... 07/03/08 1.450 2,500,000 5,000,000 Mecklenburg County, North Carolina(1).......... 07/03/08 1.520 5,000,000 620,000 Minneapolis, Minnesota(1)...................... 07/03/08 1.370 620,000 2,000,000 Minneapolis, Minnesota(1)...................... 07/03/08 1.370 2,000,000 8,900,000 Minneapolis, Minnesota(1)...................... 07/03/08 1.370 8,900,000 1,205,000 Minneapolis, Minnesota......................... 12/01/08 3.000 1,210,699 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 7 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) GENERAL OBLIGATIONS (continued) $ 2,450,000 Minneapolis, Minnesota, Special School District No. 1.............................. 02/01/09 4.000% $ 2,482,593 1,575,000 State of Minnesota............................. 10/01/08 5.000 1,583,389 2,000,000 Montgomery County, Maryland(1)................. 07/01/08 1.700 2,000,000 1,835,000 Montgomery County, Maryland.................... 07/01/08 5.000 1,835,000 7,000,000 State of North Carolina(1)..................... 07/02/08 1.540 7,000,000 1,000,000 State of North Carolina........................ 03/01/09 5.000 1,018,985 800,000 State of North Carolina........................ 03/01/09 5.250 817,238 1,500,000 State of Ohio.................................. 09/01/08 4.000 1,505,571 1,000,000 State of Ohio.................................. 09/15/08 4.000 1,004,067 1,750,000 State of Ohio.................................. 05/01/09 5.500 1,802,980 5,000,000 State of Oregon(1)............................. 07/01/08 1.700 5,000,000 6,000,000 State of Oregon(1)............................. 07/01/08 1.700 6,000,000 1,000,000 State of Oregon(1)............................. 07/02/08 1.450 1,000,000 3,210,000 Port Tacoma, Washington(1)..................... 07/01/08 3.050 3,210,000 1,400,000 Seattle, Washington(1)......................... 07/02/08 1.500 1,400,000 1,050,000 State of South Carolina........................ 08/01/08 5.000 1,051,459 3,000,000 Union County, North Carolina(1)................ 07/03/08 1.500 3,000,000 5,000,000 State of Utah.................................. 07/01/08 4.000 5,000,000 1,355,000 Virginia Beach, Virginia....................... 10/01/08 5.000 1,365,551 3,000,000 Wake County, North Carolina(1)................. 07/03/08 1.440 3,000,000 1,700,000 Wake County, North Carolina(1)................. 07/03/08 1.500 1,700,000 7,000,000 State of Washington............................ 09/01/08 5.500 7,043,542 5,000,000 Washington Suburban Sanitation District(1)................................. 07/02/08 1.500 5,000,000 ------------ Total General Obligations...................... 145,269,556 ------------ GOVERNMENT COLLATERAL (5.3%) 3,000,000 Houston, Texas, Independent School District............................. 02/15/09 5.250 3,062,805 1,800,000 Hurst-Euless-Bedford, Texas, Independent School District................. 08/15/08 4.750 1,806,839 </TABLE> The accompanying notes are an integral part of these financial statements. 8 <PAGE> BBH TAX EXEMPT MONEY FUND PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) GOVERNMENT COLLATERAL (continued) $ 1,000,000 Los Angeles, California, Unified School District.................................... 07/01/08 5.000% $ 1,010,000 5,000,000 Maricopa County, Arizona, Unified School District No. 41...................... 07/01/08 5.000 5,000,000 1,000,000 State of Michigan.............................. 11/01/08 5.000 1,010,399 2,520,000 State of Minnesota............................. 11/01/08 5.000 2,546,209 2,940,000 State of Minnesota............................. 11/01/09 5.000 2,970,763 1,000,000 New York, New York, City Transitional Finance Authority........................... 11/01/08 5.000 1,006,290 1,000,000 New York, New York, City Transitional Finance Authority........................... 11/01/08 5.000 1,006,622 2,530,000 New York State Tollway Authority Highway & Bridge Trust Fund................. 04/01/09 5.250 2,590,984 1,500,000 North Carolina Medical Care Commission.................................. 12/01/08 5.000 1,534,095 1,000,000 Oklahoma State Turnpike Authority Revenue..................................... 01/01/09 5.250 1,016,121 1,140,000 Texas State Public Finance Authority Revenue..................................... 12/15/08 5.000 1,157,276 1,000,000 University of California....................... 09/01/08 5.250 1,015,761 1,000,000 Virginia Public School Authority............... 08/01/08 4.500 1,012,320 1,000,000 Virginia Public School Authority............... 08/01/08 5.000 1,012,740 ------------ Total Government Collateral.................... 28,759,224 ------------ HEALTH CARE(1) (9.6%) 5,000,000 Charlotte-Mecklenburg, North Carolina, Hospital Authority.......................... 07/03/08 1.500 5,000,000 3,200,000 Colorado Health Facilities Authority Revenue..................................... 07/02/08 1.550 3,200,000 6,300,000 Colorado Health Facilities Authority Revenue..................................... 07/02/08 1.600 6,300,000 4,900,000 Montgomery County, Ohio........................ 07/01/08 3.500 4,900,000 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 9 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) HEALTH CARE(1) (continued) $ 6,000,000 New Mexico State Hospital Equipment Loan Council................................ 07/02/08 1.600% $ 6,000,000 2,500,000 North Carolina Medical Care Commission.................................. 07/02/08 1.540 2,500,000 2,000,000 Philadelphia, Pennsylvania, Hospitals & Higher Education Facilities Authority....... 07/01/08 1.650 2,000,000 5,000,000 Philadelphia, Pennsylvania, Hospitals & Higher Education Facilities Authority....... 07/01/08 1.650 5,000,000 4,000,000 Royal Oak, Michigan, Hospital Finance Authority................................... 07/01/08 8.000 4,000,000 7,700,000 Royal Oak, Michigan, Hospital Finance Authority................................... 07/01/08 8.500 7,700,000 6,000,000 University of North Carolina Hospital Chapel Hill Revenue......................... 07/01/08 2.500 6,000,000 ------------ Total Health Care.............................. 52,600,000 ------------ INDUSTRIAL(1) (0.5%) 1,500,000 Loudoun County, Virginia, Industrial Development Authority Revenue............... 07/02/08 1.300 1,500,000 1,500,000 Loudoun County, Virginia, Industrial Development Authority Revenue............... 07/02/08 1.480 1,500,000 ------------ Total Industrial............................... 3,000,000 ------------ MISCELLANEOUS (5.8%) 3,125,000 Alaska State Housing Finance Corp. Revenue(1).................................. 07/01/08 1.750 3,125,000 1,600,000 Alaska State Housing Finance Corp. Revenue(1).................................. 07/02/08 11.660 1,600,000 6,000,000 Connecticut State Housing Finance Authority(1)........................ 07/03/08 3.000 6,000,000 1,000,000 Illinois State Finance Authority Revenue(1).................................. 07/02/08 1.400 1,000,000 </TABLE> The accompanying notes are an integral part of these financial statements. 10 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) MISCELLANEOUS (continued) $ 1,000,000 Maine Municipal Bond Bank...................... 11/01/08 5.000% $ 1,009,272 4,000,000 Missouri State Development Finance Board(1).................................... 07/01/08 7.750 4,000,000 2,605,000 Monmouth County, New Jersey, Improvement Authority Revenue............... 10/01/08 4.500 2,611,695 2,000,000 New York, New York, City Transitional Finance Authority(1)........................ 07/02/08 1.400 2,000,000 3,040,000 Palm Beach County, Florida, Public Improvement Revenue......................... 11/01/08 4.000 3,047,537 5,900,000 South Dakota Housing Development Authority(1)................................ 07/03/08 1.600 5,900,000 1,500,000 Virginia State Public Building Authority....... 08/01/08 4.500 1,503,255 ------------ Total Miscellaneous............................ 31,796,759 ------------ TRANSPORTATION (4.0%) 3,000,000 Illinois State Toll Highway Authority Revenue(1).................................. 07/03/08 1.700 3,000,000 3,005,000 Kansas State Department of Transportation & Highway Revenue(1)......... 07/02/08 1.520 3,005,000 1,700,000 Kansas State Department of Transportation & Highway Revenue(1)......... 07/03/08 1.400 1,700,000 1,070,000 Lehman Municipal Trust Receipts(1)............. 07/02/08 1.770 1,070,000 3,000,000 Maryland State Department of Transportation.............................. 03/01/09 5.000 3,061,248 1,135,000 North Texas Tollway Authority.................. 01/01/09 5.000 1,151,273 3,000,000 Pennsylvania Turnpike Commission(1)............ 07/01/08 1.650 3,000,000 6,000,000 Triborough Bridge & Tunnel Authority, New York, Revenue(1)........................ 07/02/08 1.440 6,000,000 ------------ Total Transportation........................... 21,987,521 ------------ </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 11 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) UTILITIES(1) (3.8%) $ 2,000,000 Colorado Springs, Colorado, Utilities Revenue..................................... 07/03/08 1.500% $ 2,000,000 3,850,000 Colorado Springs, Colorado, Utilities Revenue..................................... 07/03/08 1.800 3,850,000 1,500,000 Houston, Texas, Utility System Revenue......... 07/03/08 1.700 1,500,000 2,000,000 New York State Energy Research & Development Authority....................... 07/02/08 1.420 2,000,000 4,315,000 San Antonio, Texas, Electric & Gas Revenue..................................... 07/02/08 1.770 4,315,000 2,000,000 San Antonio, Texas, Electric & Gas Revenue..................................... 07/03/08 1.600 2,000,000 4,000,000 Snohomish County, Washington, Public Utility District No. 1...................... 07/02/08 1.520 4,000,000 1,300,000 Upper Merion, Pennsylvania, Municipal Utility Authority........................... 07/03/08 1.530 1,300,000 ------------ Total Utilities................................ 20,965,000 ------------ WATER/SEWER (4.6%) 1,500,000 Boston, Massachusetts, Water & Sewer Commission(1)......................... 07/03/08 1.500 1,500,000 2,000,000 California State Department of Water Resources(1)................................ 07/02/08 10.450 2,000,000 2,400,000 Charleston, South Carolina, Waterworks & Sewer Revenue(1).......................... 07/03/08 1.550 2,400,000 1,000,000 Charlotte, North Carolina, Water & Sewer Revenue(1)............................ 07/03/08 1.550 1,000,000 700,000 Cobb County, Georgia, Water & Sewer Revenue............................... 07/01/08 5.000 700,000 1,000,000 Cobb County, Georgia, Water & Sewer Revenue............................... 07/01/08 5.000 1,000,000 1,000,000 Colorado Water Resources & Power Development Authority....................... 09/01/08 5.250 1,005,657 </TABLE> The accompanying notes are an integral part of these financial statements. 12 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> MUNICIPAL BONDS (continued) WATER/SEWER (continued) $ 3,200,000 Durham, North Carolina, Water & Sewer Revenue(1)............................ 07/02/08 1.450% $ 3,200,000 6,000,000 Gwinnett County, Georgia, Water & Sewer Authority(1).......................... 07/02/08 1.700 6,000,000 1,055,000 Iowa State Finance Authority Revenue........... 02/01/09 5.000 1,073,263 2,025,000 Massachusetts State Water Resources Authority(1)................................ 07/02/08 1.530 2,025,000 1,000,000 Michigan Municipal Bond Authority Revenue..................................... 10/01/08 5.000 1,008,208 2,000,000 Texas Water Development Board Revenue(1).................................. 07/01/08 2.050 2,000,000 ------------ Total Water/Sewer.............................. 24,912,128 ------------ Total Municipal Bonds.......................... 462,100,188 ------------ COMMERCIAL PAPER (13.3%) 5,000,000 Austin Independent School District............. 07/08/08 1.650 5,000,000 2,315,000 Board of Regents of the Texas A&M University.................................. 07/07/08 1.700 2,315,000 4,000,000 City of Austin, Texas.......................... 07/16/08 2.100 4,000,000 2,000,000 Clark County, Nevada, School District.......... 07/02/08 1.950 2,000,000 1,550,000 Jacksonville, Florida, Electric Authority Revenue..................................... 07/09/08 2.080 1,550,000 6,300,000 King County, Washington........................ 07/24/08 1.650 6,300,000 1,500,000 King County, Washington........................ 08/07/08 1.650 1,500,000 2,000,000 Massachusetts Water Resources Authority................................... 07/17/08 1.950 2,000,000 3,000,000 Memphis, Tennessee............................. 09/04/08 1.750 3,000,000 3,000,000 Montgomery County, Maryland.................... 08/05/08 1.580 3,000,000 1,300,000 Municipal Electric Authority of Georgia........ 07/08/08 1.450 1,300,000 2,050,000 Municipal Electric Authority of Georgia........ 08/11/08 1.650 2,050,000 3,000,000 Nashville & Davidson County Health and Educational Facilities Authority........ 09/02/08 1.600 3,000,000 </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 13 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- PORTFOLIO OF INVESTMENTS (continued) June 30, 2008 <TABLE> <CAPTION> Principal Maturity Interest Amount Date Rate Value - ----------- -------- -------- ----------- <S> <C> <C> <C> <C> COMMERCIAL PAPER (continued) $ 4,000,000 New York, New York............................. 07/03/08 4.050% $ 4,000,000 5,000,000 New York, New York............................. 07/03/08 4.050 5,000,000 1,000,000 North Carolina Capital Facilities Finance Agency...................................... 08/12/08 1.500 1,000,000 5,500,000 North Texas Tollway Authority.................. 10/09/08 1.600 5,500,000 3,000,000 Oklahoma City Water Utilities Trust............ 09/03/08 1.580 3,000,000 3,000,000 Orange County, Florida......................... 07/14/08 2.000 3,000,000 2,000,000 South Carolina Public Service Authority........ 08/08/08 1.650 2,000,000 4,000,000 Tennessee State School Bond.................... 08/06/08 1.900 4,000,000 2,000,000 Tennessee State School Bond.................... 08/07/08 1.520 2,000,000 2,500,000 Tennessee State School Bond.................... 09/04/08 1.650 2,500,000 1,000,000 Texas Public Finance Authority................. 07/10/08 1.590 1,000,000 2,500,000 Texas Public Finance Authority................. 08/07/08 1.500 2,500,000 ------------ Total Commercial Paper......................... 72,515,000 ------------ TOTAL INVESTMENTS, AT AMORTIZED COST.................................... 97.8% $534,615,188 OTHER ASSETS IN EXCESS OF LIABILITIES................................... 2.2 11,962,086 ----- ------------ NET ASSETS ............................................................. 100.0% $546,577,274 ===== ============ </TABLE> - ---------- (1) Variable rate instrument. Interest rates change on specific dates (such as coupon or interest payment date). The yield shown represents the June 30, 2008 coupon or interest rate. The accompanying notes are an integral part of these financial statements. 14 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- STATEMENT OF ASSETS AND LIABILITIES June 30, 2008 ASSETS: Investments, at amortized cost ............................ $534,615,188 Receivables for: Investments sold ....................................... 9,742,911 Interest and other receivables ......................... 2,550,072 ------------ Total Assets ......................................... 546,908,171 ------------ LIABILITIES: Due to Brown Brothers Harriman & Co. ...................... 31,606 Payables for: Investment advisory and administrative fees ............ 112,388 Shareholder servicing fees ............................. 109,918 Dividends declared ..................................... 38,143 Professional fees ...................................... 20,424 Custody and accounting fees ............................ 14,809 Board of Trustees' fees ................................ 2,609 Accrued expenses and other liabilities .................... 1,000 ------------ Total Liabilities .................................... 330,897 ------------ NET ASSETS, for 546,571,244 fund shares outstanding .......... $546,577,274 ============ Net Assets Consist of: Paid-in capital ........................................... $546,574,372 Undistributed net investment income ....................... 2,902 ------------ Net Assets ................................................... $546,577,274 ============ NET ASSET VALUE AND OFFERING PRICE PER SHARE ................. $1.00 ===== The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 15 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- STATEMENT OF OPERATIONS For the year ended June 30, 2008 NET INVESTMENT INCOME: Income: Investment income ..................................... $ 12,223,172 ------------ Expenses: Investment advisory and administrative fees ........... 1,069,468 Shareholder servicing fees ............................ 1,069,468 Custody and accounting fees ........................... 64,391 Board of Trustees' fees ............................... 36,612 Professional fees ..................................... 31,382 Miscellaneous expenses ................................ 109,716 ------------ Total Expenses ...................................... 2,381,037 Expense offset arrangement .......................... (19,529) ------------ Net Expenses ........................................ 2,361,508 ------------ Net Investment Income .................................... $ 9,861,664 ============ The accompanying notes are an integral part of these financial statements. 16 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- STATEMENTS OF CHANGES IN NET ASSETS <TABLE> <CAPTION> For the years ended June 30, -------------------------------------- 2008 2007 ------------- ------------- <S> <C> <C> INCREASE (DECREASE) IN NET ASSETS: From Operations: Net investment income ...................................................... $ 9,861,664 $ 12,564,686 Dividends declared from net investment income ................................. (9,858,762) (12,562,787) ------------- ------------- Net increase in net assets from operations ................................. 2,902 1,899 ------------- ------------- From Fund Share (Principal) Transactions at Net Asset Value of $1.00 per share: Fund shares sold ......................................................... 732,984,132 353,300,401 Fund shares issued in reinvestment of dividends .......................... 6,550 6,378,787 Fund shares repurchased .................................................. (514,652,648) (524,604,107) ------------- ------------- Net increase (decrease) in net assets resulting from fund share transactions ........................................ 218,338,034 (164,924,919) ------------- ------------- NET ASSETS: Beginning of year ............................................................. 328,236,338 493,159,358 ------------- ------------- End of year ................................................................... $ 546,577,274 $ 328,236,338 ============= ============= </TABLE> The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENT JUNE 30, 2008 17 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS Selected per share data and ratios for a share outstanding throughout each year <TABLE> <CAPTION> For the years ended June 30, ------------------------------------------------------------------------ 2008 2007 2006 2005 2004 ------- ------- ------- ------- ------- <S> <C> <C> <C> <C> <C> Net asset value, beginning of year ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 Income from investment operations: Net investment income ......................... 0.02 0.03 0.02 0.01 0.00(1) Dividends to shareholders from net investment income ............................. (0.02) (0.03) (0.02) (0.01) (0.00)(1) ------- ------- ------- ------- ------- Net asset value, end of year ..................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======= ======= ======= ======= ======= Total return ..................................... 2.40% 3.03% 2.31% 1.15% 0.42% Ratios/Supplemental data: Net assets, end of year (in millions) ......... $ 547 $ 328 $ 493 $ 438 $ 453 Net expenses paid by Fund ..................... 0.55% 0.58% 0.56% 0.56% 0.55% Expense offset arrangement .................... 0.00%(2) 0.01% 0.00%(2) 0.00%(2) 0.00%(2) ------- ------- ------- ------- ------- Total expenses ............................. 0.55% 0.59% 0.56% 0.56% 0.55% ======= ======= ======= ======= ======= Ratio of net investment income to average net assets ......................... 2.31% 2.98% 2.31% 1.15% 0.42% </TABLE> - ---------- (1) Less than $0.01 per share. (2) Less than 0.01%. The accompanying notes are an integral part of these financial statements. 18 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS June 30, 2008 1. Organization and Significant Accounting Policies. BBH Tax Exempt Money Fund (the "Fund") is a separate, diversified series of BBH Trust (the "Trust"), which is registered under the Investment Company Act of 1940, as amended. The Trust is an open-end management investment company organized as a Massachusetts business trust on June 7, 1983 and re-organized as a Delaware statutory trust on June 12, 2007. The Fund commenced operations on February 22, 1999. The Declaration of Trust permits the Trustees to create an unlimited number of series, each of which may issue a separate class of shares. The Trustees have authorized the issuance of an unlimited number of shares of the Fund without a par value. At June 30, 2008, there were seven series of the Trust. The Fund's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require management to make certain estimates and assumptions at the date of the financial statements and are based, in part, on the following accounting policies. Actual results could differ from those estimates. A. Valuation of Investments. The Fund values its investments at amortized cost, which approximates market value. The amortized cost method values a security at its cost at the time of purchase and thereafter assumes a constant amortization to maturity of any discount or premium. The Fund's use of amortized cost is in compliance with Rule 2a-7 of the Investment Company Act of 1940. B. Investment Transactions and Income. Investment transactions are accounted for on the trade date. Realized gains and losses, if any, from investment transactions are determined on the basis of identified cost. The Fund invest primarily in debt securities issued by municipalities. The ability of the issuers of the debt securities to meet their obligation may be affected by economic developments in a specific state or municipality. Interest income consists of interest accrued and discount earned (including both original issue and market discount) and premium amortization on the investments of the Fund, accrued ratably to the date of maturity. C. Federal Income Taxes. Each series of the Trust is treated as a separate entity for federal income tax purposes. It is the Fund's policy to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. At June 30, 2008, the cost of investments for federal income tax purposes was equal to the amortized cost of investments for financial statement purposes. D. Dividends and Distributions to Shareholders. Dividends from net investment income are declared daily and paid monthly to shareholders. The Fund declared dividends in the amounts of $9,858,762 and $12,562,787 for the years ended June 30, 2008 and June 30, 2007, respectively. The tax character of the dividends declared in both years was 100% tax exempt income. FINANCIAL STATEMENT JUNE 30, 2008 19 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 E. Accounting Developments. In June 2006, the Fund adopted FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. The adoption of FIN 48 had no impact on the operations of the Fund for the period ended June 30, 2008. In September 2006, Statement of Financial Accounting Standards No. 157, Fair Value Measurements (SFAS 157), was issued and is effective for fiscal years beginning after November 15, 2007. SFAS 157 defines fair value, establishes a framework for measuring fair value and expands disclosures about fair value measurements. Management is currently evaluating the implication of SFAS 157. At this time its impact on the Fund's financial statements has not yet been determined. In March 2008, Statement of Financial Accounting Standards No. 161, Disclosures about Derivative Instruments and Hedging Activities (SFAS 161), was issued and is effective for fiscal years beginning after November 15, 2008. SFAS 161 requires enhanced disclosures to provide information about the reasons the Fund invests in derivative instruments, the accounting treatment and the effect derivatives have on financial performance. Management is currently evaluating the impact the adoption of SFAS 161 will have on the Fund's financial statement disclosures. 2. Transactions with Affiliates. Investment Advisory and Administrative Fees. Effective June 12, 2007, under a combined Investment Advisory and Administrative Services Agreement ("Agreement") with the Trust, a separately identifiable department within Brown Brothers Harriman & Co. ("BBH") provides investment advice, portfolio management and administrative services to the Fund. BBH receives a combined fee from the Fund for investment advisory and administrative services calculated daily and paid monthly at an annual rate equivalent to 0.25% of the Fund's average daily net assets. Prior to June 12, 2007, under a separate agreement that covered only investment advisory fees, BBH received a fee from the Fund calculated daily and paid monthly at an annual rate of 0.15% of the Fund's average daily net assets. Brown Brothers Harriman Trust Company, LLC, the Fund's administrator, under a separate agreement that covered only administrative services, received a fee from the Fund calculated daily and paid monthly at an annual rate equivalent to 0.10% of the Fund's average daily net assets. BBH has a sub-administration services agreement with Federated Services Company ("FSC") for which FSC receives compensation paid by BBH. For the year ended June 30, 2008, the Fund incurred $1,069,468 for investment advisory and administrative services. 20 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- NOTES TO FINANCIAL STATEMENTS (continued) June 30, 2008 Shareholder Servicing Fees. The Trust has a shareholder servicing agreement with BBH for which BBH receives a fee from the Fund calculated daily and paid monthly at an annual rate of 0.25% of the Fund's average daily net assets. For the year ended June 30, 2008, the Fund incurred $1,069,468 for shareholder servicing services. Custody and Accounting Fees. BBH acts as a custodian and receives a custody and accounting fee from the Fund calculated daily and paid monthly. The custody fee is a transaction based fee with an annual minimum of $20,000, and the accounting fee is calculated at 0.01% per annum on the first $1 billion of net assets and 0.005% per annum on all net assets over $1 billion. For the year ended June 30, 2008, the Fund incurred $64,391 for custody and accounting services. These fees were reduced by $19,529 as a result of an expense offset arrangement with the Fund's custodian. In the event that the Fund is overdrawn, under the custody agreement with BBH, BBH will make overnight loans to the Fund to cover overdrafts. Pursuant to the agreement, the Fund will be charged interest based on LIBOR on the day of overdraft plus one percent. The total interest paid by the Fund for the year ended June 30, 2008 was $6,288. Board of Trustees' Fees. Each Trustee receives an annual fee as well as reimbursement for reasonable out-of-pocket expenses from the Fund. For the year ended June 30, 2008, the Fund incurred $36,612 for Trustees' fees. FINANCIAL STATEMENT JUNE 30, 2008 21 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF FUND EXPENSES June 30, 2008 EXAMPLE As a shareholder of BBH Tax Exempt Money Fund (the "Fund"), you may incur two types of costs: (1) transaction costs on purchase payments, reinvested dividends, or other distributions; and exchange fees; and (2) ongoing costs, including management fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period (January 1, 2008 to June 30, 2008). ACTUAL EXPENSES The first line of the table below provides information about actual account values and actual expenses. You may use information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During the Period" to estimate the expenses you paid on your account during the period. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid during the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds. 22 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF FUND EXPENSES (continued) June 30, 2008 Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher. <TABLE> <CAPTION> Expenses Paid Beginning Ending During Period Account Value Account Value January 1, 2008 January 1, 2008 June 30, 2008 to June 30, 2008(1) ----------------------------------------------------------- <S> <C> <C> <C> Actual...................... $1,000 $1,009.00 $2.75 Hypothetical(2)............. $1,000 $1,022.13 $2.77 </TABLE> - ---------- (1) Expenses are equal to the Fund's annualized expense ratio of 0.55%, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period). (2) Assumes a return of 5% before expenses. For the purpose of the calculation, the applicable annualized expense ratio is subtracted from the assumed return before expenses. FINANCIAL STATEMENT JUNE 30, 2008 23 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION June 30, 2008 Approval of Investment Advisory/Administrative Services Agreement At a meeting held on December 11, 2006, the Board of Trustees (the "Board") of the Trust unanimously approved a new Combined Investment Advisory/Administrative Services Agreement ("Combined Agreement"). The Board determined that the terms of the Combined Agreement will be substantially identical to those of the current advisory and administration agreements of the Funds, noting that the most significant difference in the Combined Agreement is a single fee for both investment advisory and administrative services. The following is a summary of the factors the Board took into consideration in making its determination to approve the new Combined Agreement. Nature, Extent and Quality of Services Provided by Brown Brothers Harriman & Co. ("BBH") The Board noted that, under the Combined Agreement in respect of each Fund, BBH, subject to the supervision of the Board, will be responsible for providing a continuous investment program and making purchases and sales of portfolio securities consistent with the Funds' investment objective and policies. Under the Combined Agreement, BBH also provides administrative services to each Fund. The Board considered the scope and quality of services to be provided by BBH under the Combined Agreement and noted that the scope of services provided had expanded over time, primarily, as a result of regulatory developments. The Board noted that, for example, BBH is responsible for maintaining and monitoring its own and, to varying degrees, the Funds' compliance program, and these compliance programs had recently been refined and enhanced in light of new regulatory requirements. The Board considered the quality of the investment research and administrative capabilities of BBH and the other resources it has dedicated to performing services for the Funds. The Board concluded that, overall, they were satisfied with the nature, extent and quality of services expected to be provided to each of the Funds under the Combined Agreement. Costs of Services Provided and Profitability to BBH At the request of the Board, BBH provided information concerning the profitability of BBH's current investment company advisory and other fees. The Board also reviewed BBH's profitability data for each Fund, which also included the effect of revenue generated by the shareholder servicing, administration, custody and other fees paid by the Fund. The Board discussed the difficulty of making comparisons of profitability because comparative information is not generally publicly available and is affected by numerous factors, including the structure of the service provider, the types of funds it manages and administers, its business mix, numerous assumptions regarding allocations and the entity's capital structure and cost of capital. In considering profitability information, the Board considered the effect of fall-out benefits on BBH's expenses, as well as the "revenue sharing" arrangements BBH has entered into with certain entities that distribute shares of the Funds. The Board focused on profitability of BBH's relationships with the Funds before taxes and distribution expenses. The Board concluded that it was satisfied that BBH's level of profitability from its relationship with each Fund was not excessive. 24 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 Fall-Out Benefits The Board considered that BBH does not allocate the Funds' portfolio transactions for third party research, although it did benefit from proprietary research received from brokers that execute the Funds' purchases and sales of securities. The Board recognized that the aggregate amount of commissions generated by Fund transactions was unlikely to result in the Funds receiving from full service broker dealers substantial discounts on commission rates. The Board received and reviewed information concerning BBH's policies with respect to allocating portfolio brokerage. The Board also considered that BBH receives shareholder servicing fees from certain funds, and is the Funds' administrator, custodian and securities lending agent. The Board noted that BBH retained no portion of the 12b-1 fees paid by any Fund that operated with a Rule 12b-1 plan. The Board recognized that BBH's profitability would be somewhat lower if it did not receive proprietary research for commissions or, if it did not receive the other benefits described above. The Board recognized that most Fund shareholders were also BBH clients, and that substantial assets are invested in the Funds as a result of an overall investment management program for the shareholder. The Board noted that the Funds also derive reputational and other benefits from their association with BBH and their use of the BBH name, which is licensed to the Funds by BBH. Thus, the Board did not believe that BBH revenues associated with its clients should be fairly regarded as "fallout" benefit from the Funds. Economies of Scale The Board noted that the Funds' combined fee schedules, other than the fee schedule for BBH Money Market Fund, do not contain breakpoints. As a result, if assets increase, the fee rates would not be reduced for these Funds on the incremental assets. With respect to the BBH Money Market Fund, the breakpoint will be reviewed every three (3) years by the Board, and may be adjusted upwards to take into account the effects of inflation or such other basis as may be appropriate, subject to the approval of shareholders to the extent required by the 1940 Act. There may be other economies of scale because many expenses did not rise (and fall) proportionally to increases (and decreases) in total net assets. The Board noted that BBH had priced its services in recognition of the fact that it was largely its own clients who were shareholders and, accordingly, sought to assure that the cost of these services and total expenses for each Fund were fair and reasonable. In addition, the Board noted that over the years BBH had supported certain Funds through fee waivers and expense reimbursements. Based on information they had been provided over many years, the Board observed that in the mutual fund industry as a whole, as well as among funds similar to the Funds, there FINANCIAL STATEMENT JUNE 30, 2008 25 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 appeared to be no uniformity or pattern in the fees and asset levels at which breakpoints (if any) apply. In light of the Funds' current size and expense structure, the Board concluded that it was unnecessary at this time to consider breakpoints with respect to the Funds, other than for the BBH Money Market Fund. Investment Results The Board considered the investment results of each of the Funds as compared to investment companies with its peers and with one or more selected securities indices. In addition to the information received by the Board for the meeting held on December 11, 2006, the Board received detailed performance information for each Fund at each regular Board meeting during the year. At the meeting held on October 2, 2006, the Board reviewed information showing performance of each Fund compared to its peers over the prior 1-, 3-, and 5- year periods and compared the performance information to one or more securities indices over comparable periods. Combined Fee Rate The Board considered the fee rate to be paid by each Fund to BBH. The Board recognized that it is difficult to make comparisons of these fee rates, and the combined advisory and administration fees, because there are variations in the services that are included in the fees paid by other funds. The Board considered the depth and range of services provided under the Combined Agreement. For example, in addition to a continuous investment program, BBH provides, among other things, officers (including the Funds' Chief Compliance Officer and officers to provide required certifications) and administrative services, such as shareholder communications, and tax compliance, with the attendant costs and exposure to liability. BBH also coordinates the provision of services to the Funds by nonaffiliated service providers. The following factors specific to BBH Tax Exempt Money Fund also were noted and considered by the Board in deciding to approve the Combined Agreement: The Board reviewed information showing performance of the BBH Tax Exempt Money Fund compared to iMoneyNet (Tax Free Retail). The Fund outperformed or performed in line with the average over all relevant periods. The Board also viewed with favor that the BBH Tax Exempt Money Fund's portfolio of investments had an overall high quality while the BBH Tax Exempt Money Fund's total expense ratio was lower that the iMoneyNet Average. The Board also noted that the BBH Tax Exempt Money Fund had successfully maintained a stable net asset value of one dollar at all times. Taking into account these comparisons and the other factors considered, the Board concluded that the BBH Tax Exempt Money Fund's investment results over time and its total expense ratio had been satisfactory. 26 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- DISCLOSURE OF ADVISOR SELECTION (continued) June 30, 2008 Conflicts of Interest As a general matter, certain conflicts of interest may arise in connection with a portfolio manager's management of a Fund's investments, on the one hand, and the investments of other accounts for which the portfolio manager is responsible, on the other. For example, it is possible that the various accounts managed could have different investment strategies that, at times, might conflict with one another to the possible detriment of the Fund. Alternatively, to the extent that the same investment opportunities might be desirable for more than one account, possible conflicts could arise in determining how to allocate them. Other potential conflicts might include conflicts created by specific portfolio manager compensation arrangements, and conflicts relating to selection of brokers or dealers to execute Fund portfolio trades and/or specific uses of commissions from Fund portfolio trades (for example, research, or "soft dollars"). BBH has adopted and implemented policies and procedures, including brokerage and trade allocation policies and procedures, which it believes address the conflicts associated with managing multiple accounts for multiple clients. In addition, BBH monitors a variety of areas, including compliance with account investment guidelines, the inclusion only of securities approved for purchase by the BBH's Fixed Income Credit Committee, and compliance with the BBH's Code of Ethics. Finally, BBH has structured the portfolio managers' compensation in a manner, and the Funds have adopted policies and procedures, reasonably designed to safeguard a Fund from being negatively affected as a result of any such potential conflicts. FINANCIAL STATEMENT JUNE 30, 2008 27 <PAGE> BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- ADDITIONAL FEDERAL TAX INFORMATION June 30, 2008 The percentage of tax-exempt dividends paid by BBH Tax Exempt Money Fund for the year ended June 30, 2008 was 100%. In January 2009, the Fund will report on Form 1099 the tax status of all distributions made during the calendar year 2008. Shareholders should use the information on Form 1099 for their income tax returns. The differences between book-basis and tax-basis unrealized appreciation/(depreciation) is attributable primarily to post-October long term capital loss deferral. 28 <PAGE> TRUSTEES AND OFFICERS OF BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- (unaudited) Information pertaining to the Trustees of the BBH Trust (the "Trust") and executive officers of the Trust is set forth below. Part B to the Registration Statement of the BBH Tax Exempt Money Fund includes additional information about the Fund's Trustees and is available upon request without charge by contacting the Fund at 1-800-625-5759. <TABLE> <CAPTION> Term of Number of Office Funds in and Fund Other Position(s) Length of Complex Directorships Name, Birth Date Held with Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - --------------------------------------------------------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> Joseph V. Shields Jr. Chairman of Since 2007 Managing Director, Chairman and 7 None Birth Date: the Board Chief Executive Officer of Shields March 17, 1938 and Trustee & Company (member of New York Shields & Company Stock Exchange); Chairman of 140 Broadway Capital Management Associates, New York, NY 10005 Inc. (registered investment adviser); Director of Flower Foods, Inc. (New York Stock Exchange listed company). David P. Feldman Trustee Since 2007 Director of Jeffrey Co. (1992 to 7 Director of Birth Date: present); Director of QMED (1999 Dreyfus Mutual November 16, 1939 to May 2007). Funds (59 C/O BBH & Co. Funds) 140 Broadway New York, NY 10005 Alan G. Lowy Trustee Since 2007 Private Investor. 7 None Birth Date: April 17, 1939 4111 Clear Valley Drive Encino, CA 91436 Arthur D. Miltenberger Trustee Since 2007 Retired; Trustee, R.K. Mellon 7 None Birth Date: Family Trust (1981 to June 2003); November 8, 1938 Director of Aerostructures 503 Darlington Road Corporation (aircraft Ligonier, PA 15658 manufacturer) (1996 to July 2003). Samuel F. Pryor, IV Trustee Since 2007 Private Investor. 7 None Birth Date: June 12, 1955 130 East 67th Street New York, NY 10021 </TABLE> FINANCIAL STATEMENT JUNE 30, 2008 29 <PAGE> TRUSTEES AND OFFICERS OF BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- (unaudited) <TABLE> <CAPTION> Term of Number of Office Funds in and Fund Other Position(s) Length of Complex Directorships Name, Birth Date Held with Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - --------------------------------------------------------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> H. Whitney Wagner Trustee Since 2007 President, Clear Brook Advisors, a 7 None Birth Date: registered investment advisor. March 3, 1956 Clear Brook Advisors 75 Rockefeller Plaza, 14th Floor New York, NY 10019 Officers John A. Gehret President Since 2008 President and Principal Executive N/A N/A Birth Date: and Officer of the Trust; Joined Brown April 11, 1959 Principal Brothers Harriman & Co. ("BBH & 140 Broadway Executive Co.") in 1981 and has been a New York, NY 10005 Officer Partner of the firm since 1998. Charles H. Schreiber Treasurer Since 2007 Treasurer and Principal Financial N/A N/A Birth Date: and Officer of the Trust; Senior Vice December 10, 1957 Principal President of BBH & Co. since 140 Broadway Financial September 2001; Joined BBH & Co. New York, NY 10005 Officer in 1999. Mark B. Nixon Assistant Since 2007 Assistant Secretary and Assistant N/A N/A Birth Date: Secretary, Treasurer of the Trust; Vice January 14, 1963 Assistant President of BBH & Co. (since 140 Broadway Treasurer October 2006); Accounting Manager, New York, NY 10005 Reserve Funds (August 2005-September 2006); Assistant Controller, Reserve Funds (February 2005-August 2005); Private Consultant (December 2001-February 2005). Beth Haddock Chief Since 2007 Chief Compliance Officer of the N/A N/A Birth Date: Compliance Trust (September 2007-present); December 10, 1965 Officer Chief Compliance Officer for the 140 Broadway FINRA/NYSE and SEC compliance New York, NY 10005 programs and Associate Compliance Director for the global compliance program (April 2005-present); Deputy General Counsel of AXA Advisors/ AXA Financial (November 1997-April 2005). </TABLE> 30 <PAGE> TRUSTEES AND OFFICERS OF BBH TAX EXEMPT MONEY FUND - -------------------------------------------------------------------------------- (unaudited) <TABLE> <CAPTION> Term of Number of Office Funds in and Fund Other Position(s) Length of Complex Directorships Name, Birth Date Held with Time Principal Occupation(s) Overseen by Held by and Address Trust Served# During Past 5 Years Trustee^ Trustee - --------------------------------------------------------------------------------------------------------------------------------- <S> <C> <C> <C> <C> <C> Sue M. Rim-An Anti-Money Since 2008 Anti-Money Laundering Officer, N/A N/A Birth Date: Laundering Vice President of BBH & Co. September 10, 1970 Officer (September 2007 - present); AML 140 Broadway Officer at UBS Investment Bank New York, NY 10005 (April 2006 - August 2007); AML Officer & Vice President in Private Client Services at Bear Stearns & Co (June 1992 - April 2006). Gail C. Jones Secretary Since 2007 Secretary of the Trust; Counsel, N/A N/A Birth Date: ReedSmith, LLP (since October October 26, 1953 2002); Corporate Counsel (January 1001 Liberty Avenue 1997 to September 2002) and Vice Pittsburgh, PA President (January 1999 to 15222-3779 September 2002) of Federated Services Company. George M. Polatas Vice Since 2008 Vice President of the Trust (since N/A N/A Birth Date: President June 2008); Assistant Vice March 3, 1962 President of Federated Services 1001 Liberty Avenue, Company; Vice President of various Pittsburgh, PA funds distributed by Edgewood 15222-3779 Services, Inc (January 1997 to present). Theodore J. Boudria Assistant Since 2008 Assistant Treasurer of the Trust; N/A N/A Birth Date: Treasurer Vice President (since 2003); June 26, 1968 Assistant Vice President (since 70 Franklin Street September 2000); Joined BBH & Co. Boston, MA 02110 in 1995. </TABLE> - ---------- # Each Trustee of the Trust holds office until he or she attains the age of 70 (72, in the case of Trustees who were elected as such before January 1, 2000), or until he or she sooner dies, resigns or is removed from office in accordance with the provisions of the Trust's Declaration of Trust. All officers of the Trust hold office for one year and until their respective successors are chosen and qualified (subject to the ability of the Trustees to remove any officer in accordance with the Trust's By-laws). ^ The Fund Complex consists of the Trust, which has seven series and each is counted as one "Fund" for purposes of this table. FINANCIAL STATEMENT JUNE 30, 2008 31 <PAGE> INVESTMENT ADVISER AND ADMINISTRATOR BROWN BROTHERS HARRIMAN 140 BROADWAY NEW YORK, NY 10005 DISTRIBUTOR EDGEWOOD SERVICES, INC. 5800 CORPORATE DRIVE PITTSBURGH, PA 15237-7000 SHAREHOLDER SERVICING AGENT BROWN BROTHERS HARRIMAN 140 BROADWAY NEW YORK, NY 10005 (800) 625-5759 To obtain information or make shareholder inquiries: By telephone: Call 1-800-575-1265 By E-mail send your request to: bbhfunds@bbh.com On the internet: www.bbhfunds.com This report is submitted for the general information of shareholders and is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. Nothing herein contained is to be considered an offer of sale or a solicitation of an offer to buy shares of the Fund. Such offering is made only by the prospectus, which includes details as to offering price and other material information. The Fund files with the SEC a complete schedule of its portfolio holdings, as of the close of the first and third quarters of its fiscal year, on "Form N-Q." Information on Form N-Q is available without charge and upon request by calling the Funds at the toll-free number listed above. A text only version can be viewed online or downloaded from the SEC's website at http://www.sec.gov; and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC (call 1-800-SEC-0330 for information on the operation of the Public Reference Room). You may also access this information from the BBH website at BBH.com by clicking on "BBH Mutual Funds" and selecting "Online Documents/Holdings Information." A copy of the Fund's Proxy Voting Policy is available upon request by calling the toll-free number listed above. A text-only version of the policy can be viewed online or downloaded from the SEC at www.sec.gov. BROWN [LOGO] BROTHERS HARRIMAN ITEM 2. CODE OF ETHICS. (a) The Registrant has adopted a code of ethics that applies to the Registrant's principal executive officer, principal financial officer, principal accounting officer or controller or persons performing similar functions. (b) No answer required. (c) Not applicable. (d) Not applicable. (e) Not applicable. (f) (1) Not applicable. (2) Not applicable. (3) A copy of the code of ethics referenced in Item 2(a) of this Form N-CSR is available and can be mailed, free of charge, to anyone by calling (800) 575-1265. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. (a) (1) The Registrant's Board of Trustees has designated two members of the audit committee as financial experts. (2) The following Trustees have been designated as audit committee financial experts by the Board of Trustees who are independent for purposes of this Item 3 of Form N-CSR: audit committee members Arthur D. Miltenberger and David P. Feldman are the designated audit committee financial experts. (3) Not applicable. (b) No answer required. (c) No answer required. (d) No answer required. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. TO BE PROVIDED BY D&T ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. (a) Not applicable. (b) Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS Not applicable. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable. ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable. ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. Not applicable. ITEM 11. CONTROLS AND PROCEDURES. (a) Based upon their evaluation of the Registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the Registrant's principal financial officer and principal executive officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the Registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. (b) There were no significant changes in the Registrant's internal controls or in other factors that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrants internal control over financial reporting. ITEM 12. EXHIBITS. (a) (1) Not applicable. (a) (2) A separate certification for each principal executive officer and principal financial officer of the Registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2) is filed as Exhibit 12(a) (2). SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (Registrant) BBH TRUST ------------------------------------- By (Signature and Title)* /s/ John A. Gehret ------------------------------ John A. Gehret, President (Principal Executive Officer) Date: 9/04/08 ------------------ Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. By (Signature and Title)* /s/ Charles H. Schreiber --------------------------- Charles H. Schreiber, Treasurer (Principal Financial Officer) Date: 9/04/08 ------------------ - - Print name and title of each signing officer under his or her signature. EXHIBIT 12(a) (1) A copy of the code of ethics is available and can be mailed, free of charge, to anyone by calling (800) 575-1265. EXHIBIT 12(a) (2) SECTION 302 CERTIFICATION OF PRINCIPLE EXECUTIVE OFFICER. I, John A. Gehret, certify that: 1. I have reviewed this report on Form N-CSR of BBH Trust on behalf of: BBH U.S. Treasury Money Fund, BBH Money Market Fund, and BBH Tax Exempt Money Fund, ("Registrant"); 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report; 4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have: a.) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b.) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c.) evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d.) disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and 5. The Registrant's other certifying officer and I have disclosed to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions): a.) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize, and report financial information; and b.) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. Date: 9/04/08 /s/ John A. Gehret ======================= John A. Gehret President - Principal Executive Officer EXHIBIT 12(a) (2) SECTION 302 CERTIFICATION OF PRINCIPLE FINANCIAL OFFICER. I, Charles H. Schreiber, certify that: 1. I have reviewed this report on Form N-CSR of BBH Trust on behalf of: BBH U.S. Treasury Money Fund, BBH Money Market Fund, and BBH Tax Exempt Money Fund, ("Registrant"); 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the Registrant as of, and for, the periods presented in this report; 4. The Registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the Registrant and have: a.) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b.) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c.) evaluated the effectiveness of the Registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d.) disclosed in this report any change in the Registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting; and 5. The Registrant's other certifying officer and I have disclosed to the Registrant's auditors and the audit committee of the Registrant's board of directors (or persons performing the equivalent functions): a.) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant's ability to record, process, summarize, and report financial information; and b.) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant's internal control over financial reporting. Date: 9/04/08 /s/ Charles H. Schreiber ========================== Charles H. Schreiber Treasurer - Principal Financial Officer SECTION 906 CERTIFICATIONS This certification is provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. (section) 1350, and accompanies the report on Form N-CSR for the fiscal year ended June 30, 2008 of the BBH Trust (the Registrant). Pursuant to 18 U.S.C.ss. 1350, the undersigned officers of the Registrant, hereby certify, to the best of our knowledge, that the Registrant's Report on Form N-CSR for the period ended June 30, 2008 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934 and that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. Date: 9/04/08 ------------------ /s/ John A. Gehret ======================= John A. Gehret President - Principal Executive Officer Date: 9/04/08 ------------------ /s/ Charles H. Schreiber ========================== Charles H. Schreiber Treasurer - Principal Financial Officer This certification is being furnished solely pursuant to 18 U.S.C.ss. 1350 and is not being filed as part of the Report or as a separate disclosure document.
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N-CSR Filing
BBH Limited Duration Fund Class N (BBBMX) N-CSRCertified annual shareholder report (management investment company)
Filed: 4 Sep 08, 12:00am