ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES continued FINANCIAL RISK MANAGEMENT continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2015 and for the Year Then Ended Figures in tables are expressed in billions of Rupiah, unless otherwise stated 130

42. FINANCIAL RISK MANAGEMENT continued

2. Fair value of financial assets and financial liabilities continued b. Classification and fair value continued December 31, 2014 Other Total Loans and Available for financial carrying Fair Trading receivables sale liabilities amount value Trade and other payables - - - 12,476 12,476 12,476 Accrued expenses - - - 5,211 5,211 5,211 Loans and other borrowings Short-term bank loans - - - 1,810 1,810 1,810 Long-term bank loans - - - 11,930 11,930 11,787 Obligation under finance lease - - - 4,789 4,789 4,789 Bonds and notes - - - 3,308 3,308 3,355 Two-step loans - - - 1,615 1,615 1,650 Total financial liabilities - - - 41,139 41,139 41,078 c. Fair value hierarchy The table below presents the recorded amount of financial assets measured at fair value and limited mutual funds participation unit for debt-based securities where the Net Asset Value PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2015 and for the Year Then Ended Figures in tables are expressed in billions of Rupiah, unless otherwise stated 131

42. FINANCIAL RISK MANAGEMENT continued

2. Fair value of financial assets and financial liabilities continued c. Fair value hierarchy continued Available-for-sale financial assets primarily consist of mutual funds, and Corporate and Government bonds. Corporate and Government bonds are stated at fair value by reference to prices of similar securities at the reporting date. As they are not actively traded in an established market, these securities are classified as level 2. Financial asset at fair value through profit or loss represents the Put Option on the 20 remaining ownership in Indonusa which was received as part of the divestment considerations. Since the fair value is not observable and valuation technique is used to determine the fair value, this financial asset is classified as level 3. Mutual funds actively traded in an established market are stated at fair value using quoted market price and classified within level 1. The valuation of the mutual funds invested in Corporate and Government bonds and put option requires significant management judgment due to the absence of quoted market prices, the inherent lack of liquidity and the long-term nature of such assets. As these investments are subject to restrictions on redemption such as transfer restrictions and initial lock-up periods and observable activity for the investments is limited, these investments are therefore classified within level 3 of the fair value hierarchy. Management considers, among other assumptions, the valuation and quoted price of the arrangement of the mutual funds. Reconciliations of the beginning and ending balances for items measured at fair value using significant unobservable inputs level 3 as of December 31, 2015 and 2014 are as follows: 2015 2014 Beginning balance 290 297 Unrealized loss - recognized in consolidated statement of profit or loss and other comprehensive income 118 7 Ending balance 172 290 43. CAPITAL MANAGEMENT The capital structure of the Group is as follows: 2014 2015 As restated Amount Portion Amount Portion Short-term debts 602 0.55 1,810 1.98 Long-term debts 34,010 30.99 21,642 23.74 Total debts 34,612 31.54 23,452 25.72 Equity attributable to owners of the parent company 75,136 68.46 67,721 74.28 Total 109,748 100.00 91,173 100.00 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2015 and for the Year Then Ended Figures in tables are expressed in billions of Rupiah, unless otherwise stated 132

43. CAPITAL MANAGEMENT continued

The Group