Fixed Assets and Leased Assets continued

PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2011 AND 2010 Expressed in millions of Rupiah, unless otherwise stated Appendix 542 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

x. Deposits from Customers

Deposits from customers are the funds placed by customers excluding banks with the Bank based on a fund deposit agreements. Included in this account are demand deposits, saving deposits, time deposits and other similar deposits. Demand deposits represent deposits of customers that may be used as instruments of payment, and which may be withdrawn at any time by cheque, automated teller machine card ATM or other orders of payment or transfers. Saving deposits represent deposits of customers that may only be withdrawn over the counter and via ATMs or funds transfers by SMS Banking, Phone Banking and Internet Banking when certain agreed conditions are met, but which may not be withdrawn by cheque or other equivalent instruments. Time deposits represent customers deposits that may only be withdrawn after a certain time based on the agreement between the depositor and the Bank. These are stated at amortised cost in the certificates between the Bank and the holders of time deposits. Included in demand deposits are wadiah demand and saving deposits. Wadiah demand deposits can be used as payment instruments and can be withdrawn any time using cheque and bilyet giro. Wadiah demand and saving deposits earn bonus based on Bank’s policy. Wadiah saving and demand deposits are stated at the Bank’s liability amount. Deposits from customers are classified as financial liabilities at amortised cost. Incremental costs directly attributable to acquistion of deposits from customers are included in the amount of deposits and amortised over the expected life of the deposits. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost.

y. Deposits from Other Banks

Deposits from other banks represent liabilities to local and overseas banks, in the form of demand deposits, saving deposits, inter-bank call money with original maturities of 90 days or less and time deposits. Deposits from other banks are recorded as liability to other banks. Included in the deposits from other banks are sharia deposits in form of wadiah deposits, and Certificates Mudharabah Investment Bank SIMA. SIMA is an investment certificate issued by the BSM which adopts profit sharing practice and in form of placement among banks. SIMA financing period ranges from 1 – 6 months. Deposits from other banks are classified as financial liabilities at amortised cost. Incremental costs directly attributable to acquistion of deposits from other banks are included in the amount of deposits and amortised over the expected life of the deposits. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost. PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2011 AND 2010 Expressed in millions of Rupiah, unless otherwise stated Appendix 543 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

z. Liability for Future Policy Benefits and Liability to Unit-Linked Holders

Subsidiary’s liability for future policy benefits is stated in the consolidated statement of financial position balance sheet as other liabilities in accordance with the actuarial calculation. Increases or decreases in liability for future policy benefit are recognised as an expense or income in the current year consolidated statement of income. Liability to unit-linked policyholders is classified as financial liabilities at fair value through profit or loss. Refer to Note 2c for the accounting policy of financial liabilities at fair value through profit or loss. Funds received from customers for non-sharia unit-linked products are reported as gross premiums in the consolidated statement of income. Subsidiary’s liabilities to non-sharia unit-linked policyholders are recognised in the consolidated statement of financial position balance sheet for the amount received net of the portion of premium representing the Subsidiary’s revenue, with a corresponding income statement recognition for the increase in liabilities to non-sharia unit-linked policyholders. Any interest, gain or loss due to increases or decreases in market value of investments are recorded as income or expense, with a corresponding recognition of increase or decrease in liability to non- sharia unit-linked policyholders in the consolidated statement of income and liability to non-sharia unit-linked policyholders in the consolidated statement of financial position balance sheet. Funds received from customers for sharia unit-linked products is recognized as liabilities to sharia unit-linked policyholders in the consolidated statement of financial position balance sheet for the amount received net of the Subsidiary’s fee ujrah portion in managing the revenue from unit-linked products. aa. Marketable Securities Issued Marketable securities issued by the Bank and its Subsidiaries, include floating rate notes, medium- term notes and travelers’ cheques, are initially measured at fair value plus directly attributable transaction costs. Subsequently transactions costs are amortised using the effective interest rate up to the maturity of marketable securities issued. Marketable securities issued are classified as financial liabilities at amortised cost. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost. ab. Fund Borrowings Fund borrowings represent funds received from other banks, Bank Indonesia or other parties with the obligation of repayment in accordance with the requirements of the loan agreement. Fund borrowings are initially measured at fair value plus directly attributable transaction costs. Fund borrowings are classified as financial liabilities at amortised cost. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost.