CASH DIVIDENDS AND GENERAL RESERVE PENSION AND OTHER POST-EMPLOYMENT BENEFITS

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2016 and for the Year Then Ended Figures in tables are expressed in billions of Rupiah, unless otherwise stated 81

29. PENSION AND OTHER POST-EMPLOYMENT BENEFITS continued a. Pension benefit costs continued

i. The Company continued a. Funded pension plan continued The expected return is determined based on market expectation for returns over the entire life of the obligation by considering the portfolio mix of the plan assets. The actual return on plan assets was Rp2,600 billion and Rp332 billion for the years ended December 31, 2016 and 2015, respectively. Based on the Company’s policy issued on January 14, 2014 regarding Dapen’s Funding Policy, the Company will not contribute to Dapen when Dapen’s Funding Sufficiency Ratio FSR is above 105. Based on Dapen’s financial statement as of December 31, 2016, Dapen’s FSR is above 105. Therefore, the Company does not expect to contribute to the defined benefit pension plan in 2016. Based on the Company ’s policy issued on July 1, 2014 regarding Pension Regulation by Dana Pensiun Telkom, there is an increase in monthly benefits given to the pensioners, widowwidower or the children of participants who stopped working before the end of June, 2002. During 2015, the Company made settlements to pensioners, widowwidower or the children of participant who has monthly pension benefits under Rp1,500,000 and choose to withdraw their pension benefits in lump sum. Based on the Company ’s policy issued on June 24, 2016 regarding Pension Regulation by Dana Pensiun Telkom, widowwidower or the children of participants who enrolled before April 20, 1992, will receive increase in monthly pension benefits from 60 to 75 of pension benefits received by the pensioners which effective starting from January 1, 2016. In addition, the Company provide other benefits to increase the pensioner ’s welfare which only provided in 2016. The Company provide other benefit of Rp6 million to monthly pension beneficiaries who retired before end of June 2002 and other benefit of Rp3 million to monthly pension beneficiaries who retired starting from the end of June 2002 until the end of May 2016. The movements of the prepaid pension benefit cost during the years ended December 31, 2016 and 2015 are as follows: 2016 2015 Prepaid pension benefit cost at beginning of year 1,329 1,170 Net periodic pension benefit cost 640 27 Actuarial gain losses recognized in OCI 1,680 1,666 Asset ceiling recognized in OCI - 357 Return on plan assets excluding amount included in net interest expense 1,188 1,837 Prepaid pension benefit cost at end of year 197 1,329 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2016 and for the Year Then Ended Figures in tables are expressed in billions of Rupiah, unless otherwise stated 82

29. PENSION AND OTHER POST-EMPLOYMENT BENEFITS continued a. Pension benefit costs continued