PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of March 31, 2014 and for three months period then ended unaudited
Figures in tables are expressed in billions of rupiah, unless otherwise stated
31
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued u. Financial instruments
The Company and subsidiaries classify financial instruments into financial assets and financial liabilities. Financial assets and liabilities are recognized initially at fair value including transaction
costs. These are subsequently measured either at fair value or amortized cost using the effective interest rate method in accordance with their classification.
i. Financial assets
The Company and subsidiaries classify their financial assets as i financial assets at fair value through profit or loss, ii loans and receivables, iii held-to-maturity financial assets or
iv available-for-sale financial assets. The classification depends on the purpose for which the financial assets are acquired. Management determines the classification of financial assets at
initial recognition.
Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace regular way trades are
recognized on the trade date, i.e., the date that the Company and subsidiaries commit to purchase or sell the assets.
The Company’s financial assets include cash and cash equivalents, other current financial assets, trade receivables and other receivables, long-term investments, advances and other
non-current financial assets.
a. Financial assets at fair value through profit or loss Financial assets at fair value through profit or loss are financial assets classified as held
for trading. A financial asset is classified as held for trading if it is acquired principally for the purpose of selling or repurchasing it in the near term and for which there is evidence
of a recent actual pattern of short-term profit taking. Gains or losses arising from changes in fair value of the trading securities are presented as other expensesincome in
consolidated statement of comprehensive income in the period in which they arise.Financial asset measured at fair value through profit loss consists of derivative
asset-put option which is recognized as part of other current financial assets.
b. Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market. Loans and receivables consist of, among other things, cash and cash equivalents, trade receivables, other receivables,
other current financial assets and other non-current financial assets.
These are initially recognized at fair value including transaction costs and subsequently measured at amortized cost, using the effective interest method.
c. Held-to-maturity financial assets Held-to-maturity investments are non-derivative financial assets with fixed or determinable
payments and fixed maturities that management has the positive intention and ability to hold to maturity, other than:
a those that the Company upon initial recognition designates as assets at fair value through profit or loss;
b those that the Company designates as available for sale; and c those that meet the definition of loans and receivables.
No financial assets were classified as held-to-maturity financial assets as of March 31, 2014 and December 31, 2013.
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of March 31, 2014 and for three months period then ended unaudited
Figures in tables are expressed in billions of rupiah, unless otherwise stated
32
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued u. Financial instruments continued
