PENSION AND OTHER POST-EMPLOYMENT BENEFITS 2014

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 92 34. PENSION AND OTHER POST-EMPLOYMENT BENEFITS continued b. Pension benefit costs provisions continued ii Telkomsel Telkomsel provides a defined benefit pension plan to its employees. Under this plan, employees are entitled to pension benefits based on their latest basic salary or take-home pay and the number of years of their service. PT Asuransi Jiwasraya “Jiwasraya”, a state-owned life insurance company, manages the plan under an annuity insurance contract. Until 2004, the employees contributed 5 of their monthly salaries to the plan and Telkomsel contributed any remaining amount required to fund the plan. Starting 2005, the entire contributions are fully made by Telkomsel. Telkomsel’s contributions to Jiwasraya amounted to Rp98 billion and RpNil for the years ended December 31, 2014 and 2013, respectively. The following table presents the change in projected pension benefits obligation, change in pension plan assets, funded status of the pension plan and net amount recognized in the Company’s consolidated statement of financial position for the years ended December 31, 2014 and 2013 of its defined benefit pension plan: 2014 2013 Change in projected pension benefits obligation Projected pension benefits obligation at beginning of year 899 1,472 Service cost 74 130 Interest cost 81 88 Actuarial losses gains 234 789 Expected pension benefits paid 7 2 Projected pension benefits obligation at end of year 1,281 899 Changes in pension plan asset Fair value of pension plan assets at beginning of year 439 666 Expected return on pension plan assets 40 40 Employers contributions 98 - Actuarial gains losses 67 265 Expected pension benefits paid 7 2 Fair value of pension plan assets at end of year 637 439 Funded status 644 460 Unrecognized items in the consolidated statement of financial position: Prior service costs Net actuarial losses gains 18 153 Pension benefit costs provisions 626 613 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 93 34. PENSION AND OTHER POST-EMPLOYMENT BENEFITS continued b. Pension benefit costs provisions continued ii Telkomsel continued The components of the net periodic pension costs are as follows: 2014 2013 Service costs 74 130 Interest costs 81 88 Expected return on pension plan assets 40 40 Amortization of past service costs 1 1 Actuarial gain losses recognized 5 15 Net periodic pension costs Note 27 111 194 The net periodic pension costs for the pension plan was calculated based on actuary measurement date as of December 31, 2014 and 2013, with reports dated February 5, 2015 and February 20, 2014, respectively, by TWP, an independent actuary in association with TW. The principal actuarial assumptions used by the independent actuary based on the measurement date as of December 31, 2014 and 2013, are as follows: 2014 2013 Discount rate 8.25 9.00 Expected long-term return on plan assets 8.25 9.00 Rate of compensation increases 6.50 6.50 Historical information 2014 2013 2012 2011 2010 Present value of funded defined benefit obligation 1,281 899 1,472 1,237 663 Fair value of plan assets 637 439 666 458 246 Deficit in the plan 644 460 806 779 417 Experience adjustments arising on plan liabilities 55 43 71 44 9 Experience adjustments arising on plan assets 67 265 139 192 49

c. Other post-employment benefits provisions

The Company provides other post-retirement benefits in the form of cash paid to employees on their retirement or termination. These benefits consist of final housing allowance “Biaya Fasilitas Perumahan Terakhir” or “BFPT” and home passage leave “Biaya Perjalanan Pensiun dan Purnabhakti” or “BPP”. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 94 34. PENSION AND OTHER POST-EMPLOYMENT BENEFITS continued c. Other post-employment benefits provisions lanjutan Movements of the other post-employment benefit costs provisions for the years ended December 31, 2014 and 2013: 2014 2013 Other post-employment benefit costs provisions at beginning of year 349 310 Other post-employment benefit costs 61 66 Other post-employment benefits paid by the Company 34 27 Net other post-employment benefit costs provisions at end of year 376 349 The principal actuarial assumptions used by the independent actuary as of December 31, 2014 and 2013 are as follows: 2014 2013 Discount rate 8.50 9.00 Rate of compensation increases 8.00 8.00 Components of the total periodic other post-employment benefit costs for the years ended December 31, 2014 and 2013: 2014 2013 Service costs 9 11 Interest costs 38 30 Amortization of past service costs 7 7 Actuarial losses recognized 7 18 Other post-employment benefit costs Note 27 61 66 Historical information: 2014 2013 2012 2011 2010 Present value of funded defined benefit obligation 488 450 508 462 409 Deficit in the plan 488 450 508 462 409 Experience adjustments arising on plan liabilities 12 7 5 13 11

d. Obligation under the Labor Law provisions

Under Law No. 13 Year 2003, the Group is required to provide minimum pension benefit, if not covered yet by the sponsored pension plans, to their employees upon retirement age. The total related obligation recognized as of December 31, 2014 and 2013 amounted to Rp239 billion and Rp189 billion, respectively. The related employee benefit costs charged to expense amounted to Rp54 billion and Rp17 billion for the years ended December 31, 2014 and 2013, respectively. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 95

35. LONG SERVICE AWARDS “LSA”

Telkomsel and Patrakom provides certain cash awards or certain number of days leave benefits to its employees based on the employees’ length of service requirements, including LSA and LSL. LSA are either paid at the time the employees reach certain years during employment, or at the time of termination. LSL are either certain number of days leave benefit or cash, subject to approval by management, provided to employees who meet the requisite number of years of service and with a certain minimum age. The obligation with respect to these awards was determined based on an actuarial valuation using the Projected Unit Credit method, and amounted to Rp410 billion and Rp336 billion as of December 31, 2014 and 2013, respectively. The related benefit costs charged to expense amounted to Rp115 billion and Rp19 billion for the years ended December 31, 2014 and 2013, respectively Note 27. 36. POST-EMPLOYMENT HEALTH CARE BENEFITS PROVISIONS The Company provides a post-employment health care benefits to all of its employees hired before November 1, 1995 who have worked for the Company for 20 years or more when they retire, and to their eligible dependents. The requirement to work for 20 years does not apply to employees who retired prior to June 3, 1995. The employees hired by the Company starting from November 1, 1995 are no longer entitled to this plan. The plan is managed by Yakes. The defined contribution post- employment health care benefits is provided to employees hired with permanent status on or after November 1, 1995 or employees with terms of service less than 20 years at the time of retirement. The Company’s contribution amounted to Rp15 billion and Rp17 billion for the years ended December 31, 2014 and 2013, respectively. The following table presents the change in the projected post-employment health care benefits obligation, change in post-employment health care benefits plan assets, funded status of the post- employment health care benefits plan and net amount recognized in the Company’s consolidated statement of financial position as of December 31, 2014 and 2013: 2014 2013 Change in projected post-employment health care benefits obligation Projected post-employment health care benefits obligation at beginning of year 10,653 13,162 Service costs 45 70 Interest costs 942 813 Actuarial losses gains 237 3,099 Expected post-employment health care benefits paid 373 293 Projected post-employment health care benefits obligation at end of year 11,504 10,653