COST OF REVENUE 2009 OPERATING EXPENSES a.

Adaro Energy Annual Report 2009 185 www.adaro.com PT ADARO ENERGY Tbk AND SUBSIDIARIES Schedule 547 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2009 AND 2008 Expressed in million Rupiah, unless otherwise stated

34. TAXATION continued b.

Recoverable taxes continued In 2008, the Government of Indonesia through the Financial and Development Supervisory Board “BPKP” commenced an audit to resolve this dispute on VAT paid offsetting royalties payable for the period from 2001 to 2007. However, as at the date of this report, the formal result of this audit has not been issued by the Government of Indonesia. In September 2008, Adaro has placed a fund amounting to Rp 150,000 as a deposit in relation to the settlement of this dispute. In August 2009, BPKP continued its audit in relation to VAT and sales tax for the fiscal periods prior to 2001, as well as the 2008 fiscal period. As at the date of this report, the audit is still ongoing. Management is of the opinion that the audit result will not have a material impact on the Groups financial position and cash flow. Vehicle fuel tax Pajak Bahan Bakar Kendaraan Bermotor“PBBKB” receivable represents the balance of PBBKB that may b e compensated by the Goverment of Indonesia, since PBBKB is a new tax according to the provisions of the CCA..

c. Taxes payable

2009 2008 The Company Income tax articles 23 and 26 9,103 37 Final tax article 42 2,011 - Income tax article 21 197 876 VAT output - 365 11,311 1,278 Subsidiaries Corporate income tax 2,183,082 1,115,479 VAT 28,105 156 Income tax articles 23 and 26 20,075 28,946 Income tax article 21 9,049 5,214 Final tax article 42 436 124 Income tax article 15 - 17 2,240,747 1,149,936 2,252,058 1,151,214

d. Income tax expense

2009 2008 The Company Current - - Deferred 9,293 9,268 9,293 9,268 Subsidiaries Current 4,162,623 1,635,581 Deferred 52,815 42,873 4,109,808 1,592,708 Consolidated Current 4,162,623 1,635,581 Deferred 43,522 33,605 4,119,101 1,601,976 186 Adaro Energy Annual Report 2009 From Us to Y ou Running Adaro Management Report Owning Adaro Governing Adaro Financial Report Contact Us Corporate Social Responsibility Adaro in Summary www.adaro.com PT ADARO ENERGY Tbk AND SUBSIDIARIES Schedule 548 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2009 AND 2008 Expressed in million Rupiah, unless otherwise stated

34. TAXATION continued d.

Income tax expense continued The reconciliation between profit before income tax and estimated taxable income is as follows: 2009 2008 Consolidated profit before income tax 8,578,381 2,924,704 Profit before income tax - subsidiaries 8,607,008 2,811,424 Adjusted for consolidation elimination 4,403,541 694,235 Profit before income tax - the Company 4,374,914 807,515 Temporary difference: Provision for employee benefits 4,026 - Permanent difference: Income subject to final tax 11,586 6,397 Income from investments in subsidiaries and associates 4,398,839 754,755 Gain from sale of investments in subsidiaries - 38,279 Non-deductible expenses 27,622 8,124 4,382,803 791,307 Taxable lossincome - the Company before use of tax loss carried forward 3,863 16,208 Tax loss used - 16,208 Taxable loss - the Company 3,863 - Current income tax - the Company - - Current income tax - subsidiaries 4,162,623 1,635,581 Consolidated current income tax 4,162,623 1,635,581 Current income tax of subsidiaries, after accounting for extraordinary item refer to Note 40, was as follows: 2009 2008 Current income tax from ordinary activity 4,162,623 1,635,581 Current income tax - extraordinary item - 304,970 Total current income tax 4,162,623 1,330,611 Current income tax computations are based on estimated taxable income. The amounts may be adjusted when Annual Tax Returns are filed with the tax office. The Company’s tax losses carried forward, which can be offset against future taxable income for periods of five years, were incurred in the following fiscal periods: Year Total 2006 6,073 2007 26,533 2009 3,863 36,469 The reconciliation between income tax expense and the theoretical tax amount on the Company’s profit before income tax using currently enacted tax rates is as follows: 2009 2008 Consolidated profit before income tax 8,578,381 2,924,704 Profit before income tax - subsidiaries 8,607,008 2,811,424 Adjusted for consolidation elimination 4,403,541 694,235 Profit before income tax - the Company 4,374,914 807,515