TRADE AND OTHER RECEIVABLES continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2016 and For the Six Months Period Then Ended unaudited Figures in tables are expressed in billions of rupiah, unless otherwise stated 39

6. INVENTORIES

June 30, December 31, 2016 2015 Components 478 342 SIM cards, set top boxes, and blank prepaid vouchers 171 131 Others 130 96 Total 779 569 Provision for obsolescence Components 18 14 SIM cards, set top boxes and blank prepaid vouchers 27 27 Others - Total 45 41 Net 734 528 Movements in the provision for obsolescence are as follows: June 30, December 31, 2016 2015 Beginning balance 41 43 Provision recognized during the year 4 2 Inventory write off - 4 Ending balance 45 41 The inventories recognized as expense and included in operations, maintenance, and telecommunication service expenses as of June 30, 2016 and 2015 amounted to Rp1,015 billion and Rp984 billion, respectively Note 24. Management believes that the provision is adequate to cover losses from declines in inventory value due to obsolescence. Certain inventories of the Company’s subsidiaries amounting to Rp268 billion have been pledged as collateral under lending agreements Notes 15 and 16c. As of June 30, 2016 and December 31, 2015, modules and components held by the Group with book value amounting to Rp222 billion and Rp219 billion, respectively, has been insured against fire, theft, and other specific risks. Modules are recorded as part of property and equipment. Total sum insured as of June 30, 2016 and December 31, 2015 amounted to Rp291 billion, respectively. Management believes that the insurance coverage is adequate to cover potential losses of inventories arising from the insured risks. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2016 and For the Six Months Period Then Ended unaudited Figures in tables are expressed in billions of rupiah, unless otherwise stated 40

7. ADVANCES AND PREPAID EXPENSES June 30,

December 31, 2016 2015 Frequency license Notes 35c.i and 35c.ii 1,775 2,935 Prepaid rental 1,373 1,055 Advances 765 729 Salaries 431 347 Imprest fund 129 28 Others each below Rp75 billion 1,133 745 Total 5,606 5,839 Refer to Note 32 for details of related party transactions.

8. LONG-TERM INVESTMENTS

June 30, 2016 Share of net loss Percentage profit of of Beginning Additions associated Ending ownership balance Deductions company Dividend Translation balance Long-term investments in associated companies: Tiphone a 24.65 1,404 - 50 23 - 1,431 Indonusa b 20.00 221 - - - - 221 Teltranet c 51.00 71 - 20 - - 51 PT Melon Indonesia “Melon” d 51.00 50 - 8 - - 58 PT Integrasi Logistik Cipta Solusi “ILCS” e 49.00 40 - 3 - - 37 Telin Malaysia f 49.00 6 3 9 - - - CSM g 25.00 - - - - - - Sub-total 1,792 3 26 23 - 1,798 Other long-term investments 15 6 - - - 21 Total long-term investments 1,807 9 26 23 - 1,819