PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2003, April 30, 2003 and December 31, 2002 Expressed in millions of Rupiah, unless otherwise stated
14
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
a. Basis of Preparation of the Consolidated Financial Statements continued The consolidated financial statements have been prepared on the historical cost and accrual basis
of accounting, except for trading and available for sale securities and Government Bonds and derivative receivables and payables which are stated at fair value, hedge bonds which are stated
at indexed value, certain investments in shares of stock which are accounted for under the equity method, and certain premises and equipment which have been revalued.
The consolidated statements of cash flows are presented under the direct method which classifies cash receipts and payments on the basis of operating, investing and financing activities. For the
purpose of the consolidated statements of cash flows, cash equivalents include cash on hand, current accounts with Bank Indonesia and current accounts with other banks.
b. Principles of Consolidation The consolidated financial statements include the financial statements of Bank Mandiri and its
majority-owned or controlled Subsidiaries. Significant inter-company balances and transactions have been eliminated.
Subsidiaries included in the consolidated financial statements are as follows:
Percentage of Ownership December 31,
April 30, December 31,
Name of Subsidiary Nature of Business
Domicile 2003
2003 2002
Bank Mandiri Europe Limited BMEL Commercial Banking
London 100.00
100.00 100.00
PT AXA Mandiri Financial Services formerly PT Asuransi Jiwa Mandiri Insurance
Jakarta 49.00 100.00
100.00 PT Bank Syariah Mandiri BSM
Syariah Banking Jakarta
99.99 99.99
99.99 PT Usaha Gedung Bank Dagang
Negara Property
Management Jakarta 99.00 99.00 99.00
PT Bumi Daya Plaza Property Management
Jakarta 93.33
93.33 93.33
PT Mandiri Sekuritas Investment Banking
Jakarta 95.68 95.68
91.87 51 interest has been sold to National Mutual Fund International Pty. Ltd., a member of the AXA Group effective on November 5, 2003,
therefore the financial statements of PT AXA Mandiri Financial Services formerly PT Asuransi Jiwa Mandiri as of December 31, 2003 were not consolidated see Note below.
BMEL was incorporated on June 22, 1999 under the Companies Act 1985 of the United Kingdom. It was established from the conversion of Bank Exim London Branch to a subsidiary effective
July 31, 1999. BMEL was mandated to act as a commercial bank to represent the interests of Bank Mandiri. The registered office of BMEL is in London, United Kingdom. In July 2002, the Bank
injected additional paid-up capital of US22 million into BMEL.
PT AXA Mandiri Financial Services formerly PT Asuransi Jiwa Mandiri was established in the Republic of Indonesia on September 30, 1991 based on notarial deed No. 179 of Muhani
Salim, S.H. dated September 30, 1991 with the name of PT Asuransi Jiwa Staco Raharja. Based on the Extraordinary General Shareholders’ Meeting held on January 31, 2002, the name of the
Company was changed from PT Asuransi Jiwa Staco Raharja to PT Asuransi Jiwa Mandiri. In accordance with Article 3 of the Company’s Articles of Association, the Company is engaged in life
insurance activities. In order to strengthen the Company’s capital structure prior to a proposed joint venture with National Mutual Fund International Pty. Ltd., a member of the AXA Group, on
September 20, 2002 and October 24, 2003 PT Asuransi Jiwa Mandiri’s paid up capital was increased by Rp10,000 and Rp28,600, respectively, as a result of the Bank’s increased investment
in the Company. On November 5, 2003, National Mutual Fund International Pty. Ltd. acquired 51 of the share ownership in the Company from Bank Mandiri. On November 5, 2003, Bank Mandiri
and National Mutual Fund International Pty. Ltd. contributed to an increase in the paid up capital of PT Asuransi Jiwa Mandiri in the amount of Rp7,777 and Rp8,095, respectively. Since then, the
Company’s name has changed from PT Asuransi Jiwa Mandiri to PT AXA Mandiri Financial Services Note 58f.
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2003, April 30, 2003 and December 31, 2002 Expressed in millions of Rupiah, unless otherwise stated
15
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
b. Principles of Consolidation continued PT Bank Syariah Mandiri BSM, was established in the Republic of Indonesia on August 10, 1973
under the name of PT Bank Susila Bhakti, a subsidiary of BDN, based on notarial deed No. 146 of R. Soeratman. The Company’s name was changed several times, the latest of which changes was
based on notarial act No. 23 of Sutjipto, S.H. dated September 8, 1999, whereby its name was changed to PT Bank Syariah Mandiri. The Company is engaged in banking activities in
accordance with “Syariah” banking principles.
PT Usaha Gedung Bank Dagang Negara was established in the Republic of Indonesia on October 29, 1971 based on notarial deed No. 104 of Abdul Latief, S.H. dated October 29, 1971.
The Company is engaged in property management and office rental activities, which involve the Company and its Subsidiaries’ offices, and other offices. It owns 75 of the share capital of
PT Pengelola Harta Tetap Mandiri PHTM, a company primarily established to manage and sell the non-core fixed assets of Bank Mandiri, and 25 of the share capital of PT Pengelola
Investama Mandiri PIM, a company primarily established to manage the investments in shares of stock of Bank Mandiri.
PT Bumi Daya Plaza was established in the Republic of Indonesia based on notarial deed No. 33 of Ny. Subagyo Reksodipuro, S.H. dated December 22, 1978. The Company is engaged in
property management and rental activities. It owns 75 of the share capital of PIM and 25 of the share capital of PHTM.
PT Mandiri Sekuritas was established in the Republic of Indonesia on July 31, 2000 based on notarial deed No. 116 of Ny. Vita Buena, S.H. replacing Sutjipto, S.H. It was established through
the merger of PT Bumi Daya Sekuritas, PT Exim Sekuritas and PT Merincorp Securindo. The merger was approved by the Minister of Laws and Regulations of the Republic of Indonesia on
August 25, 2000 based on decision letter No. C-18762 HT.01.01-TH.2000. The Bank injected additional paid-up capital of Rp300 billion full amount and Rp300 billion full amount into the
Company in December 2002 and April 2003, respectively, resulting in an increase in the percentage of the Bank’s ownership from 28.49 to 95.68.
The total assets of the Subsidiaries as of December 31, 2003, April 30, 2003 and December 31, 2002 prior to elimination amounted to Rp6,069,839, Rp4,254,717 and Rp3,371,193 or 2.43,
1.63 and 1.35 of the total consolidated assets, respectively.
For consolidation purposes, the financial statements of the overseas branches and overseas subsidiary of Bank Mandiri are translated into Rupiah on the following basis:
1 Assets, liabilities, commitments and contingencies - using the middle rates as published by
Bank Indonesia at the balance sheet date. 2
Revenues, expenses, gains and losses - using the average middle rates during each month in the financial reporting period.
3 Shareholders’ equity accounts - using historical rates.
4 Statements of cash flows - using the middle rates as published by Bank Indonesia at the
balance sheet date, except for profit and loss statement balances which are translated using the average middle rates and shareholders’ equity balances which are translated using
historical rates.
The resulting net translation adjustment is presented as “Differences Arising from Translation of Foreign Currency Financial Statements” under the Shareholders’ Equity section of the
consolidated balance sheets.
