SIGNIFICANT COMMITMENTS AND AGREEMENTS continued

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 120

44. FINANCIAL RISK MANAGEMENT continued

1. Financial risk management continued d. Credit risk The following table presents the maximum exposure to credit risk of the Group’s financial assets: 2014 2013 Cash and cash equivalents 17,672 14,696 Other current financial assets 2,797 6,872 Trade and other receivables, net 6,848 6,421 Long-term investments 16 21 Advances and other non-current assets 546 685 Total 27,879 28,695 The Group is exposed to credit risk primarily from trade and other receivables. The credit risk is managed by continuous monitoring of outstanding balances and collection. Trade and other receivables do not have any major concentration risk whereas no customer receivable balances exceed 4 of trade receivables of December 31, 2014. Management is confident in its ability to continue to control and sustain minimal exposure to credit risk given that the Group has recognized sufficient provision for impairment of receivables to cover incurred loss arising from uncollectible receivables based on existing historical data on credit losses. e. Liquidity risk Liquidity risk arises in situations where the Group has difficulties in fulfilling financial liabilities when they become due. Prudent liquidity risk management implies maintaining sufficient cash in order to meet the Group’s financial obligations. The Group continuously performs an analysis to monitor financial position ratios, such as liquidity ratios and debt-to-equity ratios, against debt covenant requirements. The following is the maturity profile of the Group’s financial liabilities: Carrying Contractual 2019 and amount cash flows 2015 2016 2017 2018 thereafter December 31, 2014 Trade and other payables 11,944 11,944 11,944 - - - - Accrued expenses 5,211 5,211 5,211 - - - - Loans and other borrowings Bank loans 13,740 16,468 6,830 3,172 2,552 2,099 1,815 Obligations under finance leases 4,789 6,535 975 927 898 830 2,905 Bonds and notes 3,308 4,673 1,370 251 229 228 2,595 Two-step loans 1,615 1,944 282 274 264 230 894 Total 40,607 46,775 26,612 4,624 3,943 3,387 8,209 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 121

44. FINANCIAL RISK MANAGEMENT continued

1. Financial risk management continued e. Liquidity risk continued Carrying Contractual 2018 and amount cash flows 2014 2015 2016 2017 thereafter December 31, 2013 Trade and other payables 11,988 11,988 11,988 - - - - Accrued expenses 5,264 5,264 5,264 - - - - Loans and other borrowings Bank loans 10,023 11,618 5,028 3,264 1,248 980 1,098 Obligations under finance leases 4,969 6,904 1,070 885 847 813 3,289 Two-step loans 1,915 2,308 292 285 278 271 1,182 Bonds and notes 3,349 4,817 582 1,311 215 203 2,506 Total 37,508 42,899 24,224 5,745 2,588 2,267 8,075 The difference between the carrying amount and the contractual cash flows is interest value. 2. Fair value of financial assets and financial liabilities a. Fair value measurement Fair value is the amount for which an asset could be exchanged, or liability settled, in an arm’s length transaction. The Group determined the fair value measurement for disclosure purposes of each class of financial assets and financial liabilities based on the following methods and assumptions: i The fair values of short-term financial assets and financial liabilities with maturities of one year or less cash and cash equivalents, trade receivables, other receivables, other current assets, trade payables, other payables, accrued expenses, and short-term bank loans, long-term investments, advances and other non-current assets are considered to approximate their carrying amounts as the impact of discounting is not significant. ii Available-for-sale financial assets primarily consist of shares, mutual funds and Corporate and Government bonds. Shares and mutual funds actively traded in an established market are stated at fair value using quoted market price or, if unquoted, determined using a valuation technique. Corporate and Government bonds are stated at fair value by reference to prices of similar securities at the reporting date.