5. Date of Next Surveillance Visit Assessment Findings 1. Lead Assessor’s Summary and Recommendation for Certification

SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 3.04 Issue 04 Rev. 6 28of 117 21 Kornel Harahap Kelurahan Muara Ampolu Muara Ampolu 22 Sulaiaman Muara Upu Desa Bandar Hapinis 23 Eddi Sulam Siregar Desa Gunung Binanga Desa Gunung Binanga 24 Halomoan Kel. Pasar Sempurna Pasar Sempurna 25 Rahmat Kurnia Siregar Desa Marancar Godang Desa Marancar Godang 26 Abdul Majid Siregar Desa Huraba Desa Huraba 27 Sukijo Desa Perkebunan Pijorkoling Perkebunan Pijorkoling 28 Ali Hasbi Harahap Desa Huta Padang Desa Huta Padang 29 Ali Akbar Desa Pal – IV Desa Pal – IV 30 M. Faisal Desa Salambue Desa Salambue 31 Ali Imran Desa Sigulang Desa Sigulang 32 Rusli siregar Desa Huta Koje Desa Huta Koje 33 Nelson Gultom Desa Huta Limbong Desa Huta Limbong 34 Ahmad Rizal Desa Huta Lombang Desa Huta Lombang 35 Pardomuan Harahap Desa Manunggang Jae Desa Manunggang Jae 36 Wagito Desa Labuhan Labo Desa Labuhan Labo 37 Rahmar Harahap Desa Labuhan Rasoki Desa Labuhan Rasoki 38 Dames Pasaribu Desa Tarutung Baru Desa Tarutung Baru

B. 5. Date of Next Surveillance Visit

One 1 year after certification audit SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 3.04 Issue 04 Rev. 6 29of 117

C. Assessment Findings

C. 1. Lead Assessor’s Summary and Recommendation for Certification

The company applied to Sucofindo for RSPO certification on June 2010 with the scope of audit are Sei Baruhur Mill and its supply bases Sei BaruhurKSBAR and Sei KebaraKSKAR estates and Sisumut Mill with its supply bases SisumutKSSUT, Aek Nabara UtaraKANAU, BatangtoruKBGTU, HapesongKHPSG estates. This is the first RSPO audit conducted by the team. The preliminary and certification audit were conducted with the perception that the report will be issued only one. During the process, RSPO issued the standard there shoud be one report for one mill and its supply bases. The team tried to separate the issue of Sei Baruhur Mill and Sisumut mill with its supply bases. The assessment has been carried out 4 four times through field visit to head office, mill and estate for Sei Baruhur Mill, Sisumut Mill and their supply bases. The preliminary audit I was conducted on 31 October 2011 – 5 November 2011. The certification audit II was conducted on 28 November 2011 – 03 December 2011. First Follow-up audit III was conducted on 10 December 2012 – 12 December 2012 to see the area of Muara Opu and Muara Ampolu. Second Follow up audit IV was conducted on 22 July 2014 – 23 July 2014 to see the implementation of SCCS at Sisumut Mill. During preliminary and certification audit, a major non-conformity was found for Muara Opu and Muara Ampolu that company has planted area for 146,50 Ha without NPP and HCV assessment. The team then conducted follow up audit to visit the Muara Opu and Muara Ampolu and raised the major non conformity for this case. The team issued 4 four major non conformities. The team has reported and discusses this case to RSPO. As a result, PTPN III has been proposed HCV Remediation Plan to RSPO. Revisions of HCV Remediation Plan are on going process discussion with RSPO Biosdiversity and HCV Working Group BHCV WG. During audit, the Supply chain certification standard was not yet published so the team conducted another follow-up audit for SCCS on July 2014. During SCCS audit, the team has informed by the company that there is a changing of the scope of the certification. The Batangtoru Mill has built and operated since…. tolong diisi then all the FFBs from Batangtoru estate KBGTU and Hapesong estate KHPSG sent directly to Batangtoru Mill. In the timebound, Hapesong Mill with its supply bases Batangtoru estate, Hapesong estate will be certified in 2016. In this report, the issue of Batangtoru and hapesong estates still there because that information to be excluded from the scope obtained after the SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 3.04 Issue 04 Rev. 6 30of 117 report was made. Therefore, the scope of the certification has been agreed to be Sisumut Mill and its supply bases ie. Sisumut estateKSSUT and Aek Nabara Utara estateKANAU only. The public announcement for certification has published on RSPO website prior 30 days from the audit certification to give the opportunity to stakeholders for comments and feedback. There is no a grievance or complaints received from the stakeholders during 30 days of public consultation period. Team auditors also conducted separate meeting with village head, local community and union labor team. There are 7 NC major, 5 NC minor and 17 observations issued during preliminary audit. The company has followed up all NCRs. At certification audit, the team issued 1 NC major, 10 NC minor and 9 observations. The team conducted follow up audit specifically for estate Batangtoru to find out the evidences of Muara Opu and Muara Ampolu data. For the follow up audit, team issued 4 NC Major. During the separated audit SCCS which was conducted at head office, there are 2 major Non conformities and 1 observation issued. The company has followed up all NCRs issued during certification; follow up audit and SCCS audit. There are remaining 4 NC Minor and 11 Observations that will be seen in the next surveillance audit. For NC Major issued during Follow up audit has been handled by RSPO BHCV WG. There is commitment of management to make corrective action and for continuous improvement. PT. Perkebunan Nusantara III has demonstrated compliance with applicable law and regulations that relevant to Palm Oil operation. The holding group also showed compliance with partial certification, as per stated in Final RSPO certification system document, June 2007, section 4.2.4 The audit team found that Sisumut Mill and its supply bases KANAU and KSSUT estates of PT.Perkebunan Nusantara III is complying against RSPO P C approved for Indonesia. The management mill and estate showed the commitment to the implementation of the principles and criteria of the RSPO NI-INA. Therefore the recommendation of the Lead Auditor that Certificate of RSPO is awarded to PT. Sisumut Mill and its supply bases KANAU and KSSUT estates of Perkebunan Nusantara III. Signed : Tuti Suryani Sirait Date : 14 April 2014 SUCOFINDO INTERNATIONAL CERTIFICATION SERVICES Sucofindo ICS FRM 3.04 Issue 04 Rev. 6 31of 117

C. 2. Summary Of The Findings by Criteria