NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued JUNE 30, 2012 UNAUDITED AND DECEMBER 31, 2011 AUDITED
AND SIX MONTHS PERIOD ENDED JUNE 30, 2012 AND 2011 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated
28
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued u. Financial instruments continued
i. Financial assets continued
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 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 June 30, 2012 and December 31, 2011.
d. Available-for-sale financial assets Available-for-sale investments are non-derivative financial assets that are intended to be
held for indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, exchange rates or that are not classified as loans and
receivables, held-to-maturity investments or financial assets at fair value through profit or loss. Available for sale financial assets consist of available for sale securities which are
recorded as available-for sale financial assets.
The Company and its subsidiaries use settlement date accounting for regular purchases and sales of financial assets.
Investments in available-for-sale securities and trading securities are stated at fair value. Unrealized holding gains or losses on available-for-sale securities are excluded from
income of the current period and are reported as a separate component in the equity section until realized. Realized gains or losses from the sale of available-for-sale
securities are recognized in the consolidated statements of comprehensive income, and are determined on a specific-identification basis. A decline in the fair value of any
available-for-sale securities below cost that is deemed to be other-than-temporary and is charged to the consolidated statements of comprehensive income.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued JUNE 30, 2012 UNAUDITED AND DECEMBER 31, 2011 AUDITED
AND SIX MONTHS PERIOD ENDED JUNE 30, 2012 AND 2011 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated
29
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued u. Financial instruments continued
i. Financial assets continued
d. Available-for-sale financial assets continued Gains or losses arising from changes in fair value of the trading securities are presented
in the income statement within other expensesincome in the period in which they arise. ii. Financial liabilties
The Company and its subsidiaries classify their financial liabilities as i financial liabilities at fair value through profit or loss or ii financial liabilities measured at amortized cost.
The Company’s financial liabilities include trade payables, other payables, accrued expenses, loans, bonds and notes.
a. Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss are financial liabilities classified as
held for trading. A financial liability 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.
No financial liabilities were categorized as held for trading as of June 30, 2012 and December 31, 2011.
b. Financial liabilities measured at amortized cost Financial liabilities that are not classified as at fair value through profit and loss fall into
this category and are measured at amortized cost. Financial liabilities measured at amortized cost are among other things, trade payables, other payables, accrued
expenses, loans, bonds and notes.
iii. Offsetting financial instruments Financial assets and liabilities are offset and the net amount is reported in the statement of
financial position when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability
simultaneously.
v. Treasury Stock Reacquired Company’s stock is accounted for at its reacquisition cost and classified as “Treasury
Stock” and presented as a deduction to equity. The cost of treasury stock sold is accounted for using the weighted average method. The difference resulting from the cost and the proceeds from
the sale of treasury stock is credited to “Additional Paid-in Capital”.
