PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2006 With comparative figures for 2005
Expressed in rupiah, unless otherwise stated
52
25. DERIVATIVE INSTRUMENTS continued
As of December 31, 2006 and 2005, the Company recognized the net liabilities on the above derivative instruments at fair value of Rp3,738,655,113 and Rp14,030,194,787, respectively, which
are presented as “Derivative Liabilities - Net” in the consolidated balance sheets. The loss arising from the derivative transactions during the year amounting to Rp43,433,189,826
was recorded as part of “Foreign Exchange Gain - Net” presented in the 2006 consolidated statement of income.
26. LITIGATION
On February 24, 2004, Ati binti Sadim dkk “Plaintiffs”, who represented themselves as the heirs of the owners of land with an area of 2,665,044 square meters located in Cipulus and Pasir Kores, Lulut
Village - West Java, filed a lawsuit against the Company for alleged unfair practices employed by the Company in acquiring the aforementioned land, specifically for the following reasons:
·
The land price is too low and inappropriate.
·
The purchase price was determined only by the Company.
·
The Company did not involve the Plaintiffs in the land measurement process.
· The Company has not paid the price for land with an area of approximately 934,111 square meters
of which it has taken possession. The total loss being claimed by the Plaintiffs due to their inability to use the land for a 30-year period
amounted to Rp41,103,585,000. Based on the decision of the District Court of Cibinong the “Court” dated August 16, 2004, the Court
rejected all of the above claims. The Plaintiffs submitted an appeal to the High Court of West Java. On March 22, 2005, the High Court of West Java confirmed the decision of the District Court of Cibinong to
reject all of the above claims. On June 27, 2005, the Plaintiffs submitted an appeal to the Supreme Court, and as of January 22, 2007
the independent auditors’ report date, the Supreme Court has not rendered its decision on the case.
27. ECONOMIC CONDITIONS The operations of the Company and its Subsidiaries may be affected by future economic conditions in
Indonesia that may contribute to volatility in currency values and negatively impact economic growth. Economic improvements and sustained recovery are dependent upon several factors, such as fiscal
and monetary actions being undertaken by the Government and others, actions that are beyond the control of the Company and its Subsidiaries.
28. MONETARY ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES
As of December 31, 2006, the Company and Subsidiaries have monetary assets and liabilities denominated in foreign currencies as follows:
PT INDOCEMENT TUNGGAL PRAKARSA Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2006 With comparative figures for 2005
Expressed in rupiah, unless otherwise stated
53
28. MONETARY ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES continued
