PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2015 and for the year then ended Expressed in millions of Rupiah, unless otherwise stated
69
3. USE OF CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS continued Key sources of estimation uncertainty continued
e. Deferred tax assets
Deferred tax assets are recognized for all deductible temporary differences, as long as it is likely that taxable income will be available so that the temporary differences can be used. Significant
estimates by management is required in determining the amount of deferred tax assets that can be recognized, based on current usage and the level of taxable income and future tax planning
strategies. Banks do not take into account some of the benefits of deferred tax assets as management believes that deferred tax assets will not be recoverable in the future.
f. Depreciation and estimated useful life of fixed assets
Cost of acquisition of fixed assets are depreciated using the straight-line method based on their estimated economic useful life. Bank management estimates the useful lives of the assets
between 5 five to 20 twenty years.
Changes in the level of usage and technological developments could affect the economic useful lives and residual value of assets, and therefore future depreciation charges may be revised.
The carrying value of fixed assets Bank disclosed in Note 18.
g. Impairment of non-financial assets
Bank Mandiri and its subsidiaries assess impairment of non-financial assets whenever events or changes in circumstances indicate that the carrying value of non-financial assets cannot be
recovered. Important factors that could cause impairment of non-financial assets are as follows:
a Performance is not achieved significantly against expectations of historical or projected operating results in the future;
b A significant change in the way the use of the asset or the overall business strategy; and c Industry or economic trends are significantly negative.
Management of the Bank and Subsidiaries recognize an impairment loss if the carrying amount of the asset exceeds its recoverable amount. Recoverable amount is the higher value between the
fair value minus costs of disposal with the use value of the asset or cash-generating unit. Estimated recoverable amount for individual assets or, if not possible, for the cash-generating unit
in which the asset forming part of the unit.
Accounting considerations are important in applying accounting policies the Bank and Subsidiaries
Accounting considerations are important in applying accounting policies the Bank and Subsidiaries include:
Going Concern
Bank and Subsidiaries Management has assessed the ability of the Bank and Subsidiaries to continue its business continuity and believes that the Bank and Subsidiaries have the resources to
continue their business in the future. In addition, management is not aware of any material uncertainties that may cause significant doubt on the ability of the Bank and Subsidiaries to
maintain its viability. Therefore, the consolidated financial statements have been prepared on the basis of a going concern.
Classification of financial assets and liabilities
Management of the Bank and Subsidiaries determine the classification of the assets and certain liabilities as financial assets and financial liabilities by considering if the definitions set SFAS
No. 55 Revised 2014 have been met. Accordingly, financial assets and financial liabilities are recognized in accordance with the accounting policy of the Bank and Subsidiaries as disclosed in
Note 2.c.E.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2015 and for the year then ended Expressed in millions of Rupiah, unless otherwise stated
70
4. CURRENT ACCOUNTS WITH BANK INDONESIA December 31, December 31,
2015 2014
Rupiah 44,557,520
40,379,267 United States Dollar Note 61B.v
11,756,796 10,219,573
56,314,316 50,598,840
As of December 31, 2015 and 2014, the Bank’s Minimum Statutory Reserve complies with Bank Indonesia BI Regulation No. 1310PBI2011 dated February 9, 2011, which latest amended by BI
Regulation No. 1721PBI2015 dated November 26, 2015 regarding the latest amendment of Bank Indonesia Regulation No. 1515PBI2013 regarding Minimum Statutory Reserve of Commercial Banks
in Rupiah and foreign currencies which are as follows:
December 31, December 31, 2015
2014
Rupiah - Primary Minimum Statutory Reserve
7.50 8.00
- Secondary Minimum Statutory Reserve 4.00
4.00 Foreign Currencies
8.00 8.00
Primary Minimum Statutory Reserve liabilities Rupiah as of December 1, 2015 decrease from 8.00 to 7.50.
Primary Minimum Statutory Reserve is a minimum reserve that should be maintained by the Bank in the Current Accounts with Bank Indonesia. Secondary Minimum Statutory Reserve is the minimum
reserves that should be maintained by the Bank, comprises of Certificates of Bank Indonesia SBI, Certificate of Bank Indonesia Deposit SDBI, Treasury Bills andor Excess Reserve, which is
determined by Bank Indonesia. Minimum Statutory Reserve on Loan to Funding Ratio LFR is the Minimum Statutory Reserve that should be maintained by the Bank in the form of Current Account with
Bank Indonesia, if the Banks LFR below the minimum of LFR targeted by Bank Indonesia 78 and if the Banks LFR above the maximum of LFR targeted by Bank Indonesia 92 given that the Capital
Adequacy Ratio below BI requirement of 14. LFR is a ratio of loan to third parties issued by the bank in Rupiah and foreign currency, not include
loan to other banks, towards: a. Third Party Funds that includes current accounts, saving accounts, and time deposits in Rupiah and
foreign currencies, excluding interbank funds; and b. Marketable securities in Rupiah and foreign currencies that meet certain requirements issued by the
Bank for obtaining capital. Based on Bank Indonesia BI Regulation No. 1711PBI2015 dated June 25, 2015, the citation of
Loan to Deposit Ratio LDR on Bank Indonesia BI Regulation No. 1515PBI2013 has been changed into Loan to Funding Ratio LFR since August 3, 2015 and calculation of Minimum Statutory
Reserve of LFR has become effective since August 3, 2015. Excess Reserve is an excess Bank’s balance of the Rupiah Account of Primary Minimum Statutory
Reserve and Minimum Statutory Reserve on Loan to Funding Ratio that should be maintained in Bank Indonesia.
