PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2003, April 30, 2003 and December 31, 2002 Expressed in millions of Rupiah, unless otherwise stated
96
27. TAXATION continued c. Corporate income tax expense - current continued
For the
For the 8-month For the 4-month
year ended period ended
period ended December 31,
December 31, 2003 April 30, 2003
2002
Others 8,670
20,581 213,152
Adddeduct temporary differences: Allowable tax depreciation overunder
financial statement depreciation 414 27,648
205,910 Financial statement provision for personnel
expenses under over allowable tax provision 567,530
206,523 7,577
Financial statement provision for losses on earning assets other than loans overunder
allowable tax provision 121,881
60,013 1,816,005
Financial statement provision for loan losses underover allowable tax provision
870,251 40,683
1,111,464 Financial statement provision for losses on
commitments and contingencies underover allowable tax provision
916,804 277,210
4,073,259 Financial statement provision for losses arising
from legal cases underover allowable tax provision 448,268
162,760 89,217
Lossesgains on increase in market value of securities and Government Recapitalization Bonds
727,386 765,680
1,433,001 Estimated taxable incometax loss
4,411,878 2,884,720
6,370,979 Less: Utilization of tax loss carried forward
31,406 -
- Estimated taxable income after compensation
with tax loss carried forwardtax loss 4,380,472 2,884,720 6,370,979
Estimated corporate income tax expense - current Bank Mandiri only
1,314,142 865,399
- Subsidiaries
5,795 3,541
824
Estimated corporate income tax expense - current 1,319,937
868,940 824
Under the Indonesian taxation laws, Bank Mandiri and its Subsidiaries submit tax returns on the basis of self-assessment. The tax authorities may assess or amend taxes within 10 years after the date of the tax
filings 5 years for tax years prior to 1995.
Tax Decisions and Tax Assessment On May 14, 2003, the Minister of Finance issued Decision Letter No. 211KMK.032003 dated May 14,
2003 which stated that a taxpayer that undertakes an initial public offering that previously received assets transferred from legacy companies, and which assets were valued at their historical net book
value by the legacy companies, can, as a result of a merger or business combination, also carry forward the benefit of any net accumulated tax losses from the legacy companies for up to five years,
provided that the taxpayer receives permission from the Minister of Finance to do so, and the taxpayer conducts a revaluation of all fixed assets using the market value of such fixed assets as of the date of
the merger or business combination.
On May 21, 2003, the Minister of Finance, through letter No. S-206MK.012003 dated May 21, 2003 addressed to Bank Mandiri’s President Commissioner and President Director, approved the transfer
and utilization of tax losses carried forward from the merged banks to the Bank subject to revaluation of all applicable fixed assets.
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2003, April 30, 2003 and December 31, 2002 Expressed in millions of Rupiah, unless otherwise stated
97
27. TAXATION continued c. Corporate income tax expense - current continued
Tax Decisions and Tax Assessment continued Bank Mandiri engaged PT Vigers Hagai Sejahtera, an independent appraiser, to perform a revaluation of
premises and equipment received from legacy banks. The results were submitted to and approved by the Directorate General of Taxation through the Decision Letter of the Head of State and Regional
Offices of Corporate Tax Services No. KEP-01WPJ.07KP.01052003 dated June 18, 2003 Note 14.
Based on the approval from the Minister of Finance through Decision No. S-206MK.012003 and the approval from the Directorate General of Taxation on the results of the fixed assets revaluation, Bank
Mandiri is entitled to receive the transfer of fiscal losses from the merged banks and is able to utilize the fiscal losses as compensation against future taxable income. The amount of tax losses transferred to
Bank Mandiri is Rp31,944,418. The transfer of tax losses has been taken into account by the Tax Office when re-assessing Bank Mandiri’s tax liabilities from 1999 to 2002, and such losses have been utilized
to compensate the increment arising from the revaluation of premises and equipment received from the merged banks.
On June 18, 2003, the Directorate General of Taxation issued Decision Letter No. KEP-
093WPJ.07KP.01092003, which states the “official rectification of Decision Letter No. KEP- 001274069905101 dated November 20, 2001” adjusting the tax loss carryforward that can be
compensated by Rp13,659,210. Consequently, the amount of fiscal losses that can be compensated became Rp8,234,516 for the year ended December 31, 1999.
On June 20, 2003, the Directorate General of Taxation issued a Decision Letter No. KEP- 236WPJ.07BD.032003, which states the “official rectification” of Decision Letter No. KEP-
106WPJ.07BD.032003 dated March 14, 2003 regarding the taxpayer’s objection on its corporate income tax assessment SKPKB No. 000282060005102 dated July 5, 2002 for fiscal year 2000 and
increasing the fiscal net profit for 2000 by Rp15,506,709 to become Rp28,236,332. Such fiscal net profit had been compensated with the tax loss carried forward, therefore the corporate income tax
liability for the year 2000 was RpNil. On June 23, 2003, the Directorate General of Taxation issued tax decision letter No.
00005506010512003, increasing the taxable income for 2001 by Rp2,342,573 to become Rp6,746,964. The letter confirmed that Bank Mandiri has no corporate income tax liability for 2001
due to utilization of tax losses. On June 23, 2003, the Directorate General of Taxation issued tax decision letter No.
000014060205103, reducing the tax loss for 2002 by Rp7,659,860 to become a net profit for 2002 of Rp1,288,881. The letter confirmed that Bank Mandiri has no corporate income tax liability for 2002
due to utilization of tax losses.
