Transactions with related parties continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF JUNE 30, 2013 UNAUDITED AND FOR SIX MONTHS PERIOD ENDED WITH COMPARATIVE FIGURES AS OF DECEMBER 31, 2012 AUDITED AND FOR SIX MONTHS PERIOD ENDED JUNE 30, 2012 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated 22

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

k. Intangible assets continued

Intangible assets are stated at cost less accumulated amortization and impairment, if any. Intangible assets are amortized over their useful lives. The Company and subsidiaries estimate the recoverable value of their intangible assets. When the carrying amount of an asset exceeds its estimated recoverable amount, the asset is written-down to its estimated recoverable amount. Intangible assets are amortized using the straight-line method, based on the estimated useful lives of the assets as follows: Years License 10 Other intangible assets 2-20 Intangible asset is derecognized when no further economic benefits are expected, neither from further use nor from disposal. The difference between the carrying amount and the net proceeds received from disposal is recognized in the consolidated statement of comprehensive income.

l. Property and equipment - direct acquisitions

Property and equipment directly acquired are stated at cost, less accumulated depreciation and impairment losses. The cost of the assets includes: a purchase price, b any costs directly attributable to bringing the asset to its location and condition and c the initial estimate of the costs of dismantling and is removing the item and restoring the site on which it is located. Each part of an item of property and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately. Property and equipment, except land, are depreciated using the straight-line method, based on the estimated useful lives of the assets as follows: Years Buildings 20-40 Leasehold improvements 3-7 Switching equipment 5-15 Telegraph, telex and data communication equipment 5-15 Transmission installation and equipment 5-25 Satellite, earth station and equipment 3-20 Cable network 5-25 Power supply 3-10 Data processing equipment 3-10 Other telecommunications peripherals 5 Office equipment 2-5 Vehicles Customer Premise Equipment CPE 5-8 10 Other equipment 5 Depreciation method, useful life and residual value of an asset are reviewed at least at each financial year-end and adjusted if appropriate. The residual value of an asset is the estimated amount that the Company and subsidiaries would currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected at the end of its useful life. The Company and subsidiaries determined the residual value of property and equipment amounting to Rp1.