Trametes versicolour
This is one of the prettiest fungi to be found in the average back garden, and also one of the most harmless. Rainbow fungus grows in tiers of scallop shaped brackets with multi coloured stripes ranging from greys and browns to purple and olive green. Young brackets are often very pale, appearing as white cushiony patches.
Rainbow fungus grows on dead wood so you’ll find it mostly on old stumps, firewood that has been lying around, or on dead branches in your trees.
If you notice Rainbow fungus brackets growing on a branch in your tree you may want to get an arborist to inspect the tree for safety (if the branch is large) and to check it does not have any other health problems. If the brackets are growing at the base of a dead tree then it is likely that the structural roots have been rotted and the tree is or will become unstable in the ground. These trees should be removed as soon as practicable.
Commonly seen on: dead wood on the ground, dead branches on Oaks, Elms, Plums, Melaleucas, Wattles