PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2011 AND 2010
Expressed in millions of Rupiah, unless otherwise stated
Appendix 538 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
q. Net Investment in Finance Lease
Net investment in finance lease is a finance lease receivable plus the amount of residual value to be received at the end of the lease financing decreased by unearned lease income, security deposits
and the allowance for doubtful accounts. The difference between the gross lease receivable and the present value of the lease receivables is recognized as unearned lease income. Unearned lease
income is allocated to current year consolidated statement of income based on a constant rate of return on net investment using the effective interest rate.
The lessee have the right financing option to purchase the leased asset at the end of the lease period at a price mutually agreed upon at the commencement of the agreement.
Early termination is treated as a cancellation of an existing contracts and the resulting gain or loss is credited or charged to the current year consolidated statement of income at the transaction date.
Net investment in finance leases are classified as loans and receivables. Refer to Note 2c to the accounting policy for loans and receivables.
r. Fixed Assets and Leased Assets
i. Fixed assets Fixed assets except for land is stated at cost less accumulated depreciation and impairment
losses. Such cost includes the cost of replacing part of the fixed assets when that cost is incurred, if the recognition criteria are met. Likewise, when a major inspection is performed, its cost is
recognised in the carrying amount of the fixed assets as a replacement if the recognition criteria are satisfied. All other repairs and maintenance costs that do not have future economics benefit
are recognised in the consolidated statement of income as incurred.
Depreciation and amortisation is calculated using the straight-line method over the estimated useful lives of the assets as follows:
Years Buildings
20 Furniture, fixtures, office equipment and computer equipmentsoftware and vehicles
4-5 Fixed assets are derecognised upon disposal or when no future economic benefits are expected
from their use or disposal. Any gain or loss arising from derecognition of the asset calculated as the difference between the net disposal proceeds and the carrying amount of the asset is
included in consolidated statement of income in the year the asset is derecognised.
The asset’s residual values, useful lives and methods of depreciation are reviewed, and adjusted prospectively if appropriate, at each financial year end.
Construction in progress is stated at cost and is presented as part of fixed assets. Accumulated costs are reclassified to the appropriate fixed assets account when the assets are substantially
complete and are ready for their intended use.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2011 AND 2010
Expressed in millions of Rupiah, unless otherwise stated
Appendix 539 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
r. Fixed Assets and Leased Assets continued
