Promotion and Marketing Increasing the Capacities of Development Partners

255

8. Increasing the Capacities of Development Partners

Assistance to Development Partners was totally carried out by all components of the Company including the Commissioner of the Company in the form of grants. The activities included promotion and development through training programs and visits in the spirit of exchanging views on business development and motivation.

a. Promotion and Marketing

The Company provided development assistance in the form of promotion and marketing by including Development Partners in various exhibitions both nationally and internationally. An example is the Sail Tomini Exhibition. The Company also helped the promotion of Development Partners 256 Table of Contents APPENDICES DEFINITIONS 3G The generic term for third generation mobile telecommunications technology. 3G offers high speed connections to cellular phones and other mobile devices, enabling video conference and other applications requiring broadband connectivity to the internet. 3.5G A grouping of disparate mobile telephony and data technologies designed to provide better performance than 3G systems, as an interim step towards deployment of full 4G capability. 4GLTE A fourth generation super fast internet network technology based on Internet Protocol IP that makes the process of data transfer much faster and stable. Adjusted EBITDA Adjusted EBITDA is defined as earnings before interest, tax, depreciation and amortization. Adjusted EBITDA and other related ratios in this Annual Report serve as additional indicators on our performance and liquidity, which is a non-GAAP financial measure. ADS American Depositary Share also known as an American Depositary Receipt, or an 257 BSS Base Station Subsystem, the section of a cellular telephone network responsible for handling traffic and signaling between a mobile phone and the network switching subsystem. A BSS is composed of two parts: the BTS and the BSC. BTS Base Transceiver Station, equipment that transmits and receives radio telephony signals to and from other telecommunication systems. BWA Broadband Wireless Access, a technology that provides high speed wireless internet access or computer networking access over a wide area. CDMA Code Division Multiple Access, a transmission technology where each transmission is sent over multiple frequencies and a unique code is assigned to each data or voice transmission, allowing multiple users to share the same frequency spectrum. CPE Customer Premises Equipment, any handset, receiver, set-top box or other equipment used by the consumer of wireless, fixed line or broadband services, which is the property of the network operator and located on the customer premises. DCS Digital Communication System, a mobile cellular system using GSM technology operating in the 1.8 GHz frequency band. Defined Benefit Pension Plan A type of pension plan in which an employer promises a specified monthly benefit on retirement that is predetermined by a formula based on the employee 258 E1 The backbone transmission unit which operates over two separate sets of wires, usually twisted pair cable. E1 data rate is 2,048 Mbps full duplex, which is divided into 32 timeslots. Earth Station The antenna and associated equipment used to receive or transmit telecommunication signals via satellite. EDGE Enhanced Data rates for GSM Evolution, a digital mobile phone technology that allows improved data transmission rates as a backward-compatible extension of GSM. Edutainment Education and Entertainment. Fixed Line Fixed wireline and fixed wireless. Fixed Wireless The local wireless transmission link using a cellular, microwave, or radio technology to connect customers at a fixed location to the local telephone exchange. Fixed Wireline A fixed wire or cable path linking a subscriber at a fixed location to a local exchange, usually with an individual phone number. FTTH Fiber To The Home are the implementation of fiber optic network that reaches up to customer point or known as customer premise. Gateway A peripheral that bridges a packet based network IP and a circuit based network PSTN. Gb Gigabyte, a unit of information used, for example, to quantify computer memory or storage capacity. Gbps Gigabyte per second, the average number of bits, characters, or blocks per unit time passing between equipment in a data transmission system. This is typically measured in multiples of the unit bit per second or byte per second. GHz Gigahertz. The hertz symbol Hz, the international standard unit of frequency defined as the number of cycles per second of a periodic phenomenon. GMS General Meeting of Shareholders, which may be an Annual General Meeting of Shareholders 259 Homepass A connection with access to fixed line voice, IPTV and broadband services. IDD International Direct Dialing, a service that allows a subscriber to make an international call without the assistance or intervention of an operator from any telephone terminal. IMT-2000 International Mobile Telecommunications-2000, a body of specifications provided by the International Telecommunication Union. Application services include wide area wireless voice telephone, mobile internet access, video calls and mobile TV, all in a mobile environment. Installed Lines Complete lines fully built-out to the distribution point and ready to be connected to subscribers. Interconnection The physical linking of a carrier 260 Metro Ethernet Bridge or relationship between locations that are apart geographically, this network connects LAN customers at several different locations. MHz Megahertz, a unit of measure of frequency equal to one million cycles per second. Mobile Broadband The marketing term for wireless internet access through a portable modem, mobile phone, USB Wireless Modem or other mobile devices. MoCI The Ministry of Communication and Information, to which regulatory responsibility over telecommunications was transferred from the Ministry of Communication 261 PKLN Tim Pinjaman Komersial Luar Negeri , or Foreign Commercial Loan Coordinating Team, an inter-agency team of the Government charged with, among others, considering requests of Indonesian State-Owned Enterprises such as us for consent to obtain foreign commercial loans. POWL Public Offering Without Listing. Premium SMS Premium Short Message Service, a text messaging service component of phone, web, or mobile communication systems, using standardized communications protocols that allow the exchange of short text messages between fixed line or mobile phone devices. PSTN Public Switched Telephone Network, a telephone network operated and maintained by us and the KSO Units for us and on our behalf. Pulse The unit in the calculation of telephone charge. Radio Frequency Spectrum The part of the electromagnetic spectrum corresponding to radio frequencies, i.e. frequencies lower than around 300 GHz or, equivalently, wavelengths longer than about 1 mm. RIO Reference Interconnection Offer, a regulatory term covering all facilities, including interconnection tariffs, technical facilities and administrative issues offered by one telecommunications operator to other telecommunications operator for interconnection access. RMJ Regional Metro Junction, an inter-city cable network installation service in one regional regionprovince. Roaming A general term referring to the extension of connectivity service in a location that is different from the home location where the service was registered. Satellite Transponder Radio relay equipment embedded in a satellite that receives signals from earth and amplifies and transmits the signal back to the earth. SCCS Submarine Communications Cable System, a cable laid on the sea bed between land-based stations to carry telecommunication signals across stretches of ocean. SME Small and Medium Enterprise. SMS Short Messaging Service, a technology allowing the exchange of text messages between mobile phones and between fixed wireless phones. SOE State-Owned Enterprise, a Government-owned corporation, state-owned company, state-owned entity, state enterprise, publicly owned corporation, Government business enterprise, or parastatal, a legal entity created by a Government to undertake commercial activities on behalf of an owner Government. 262 Softswitch A central device in a telephone network that connects calls from one phone line to another, entirely by means of software running on a computer system. This work was formerly carried out by hardware, with physical switchboards to route the calls. STM-1 Synchronous Transport Module level-1, the SDH ITU-T fiber optic network transmission standard with a bit rate of 155.52 Mbps. The other standards are STM-4, STM-16 and STM-64. Switch A mechanical, electrical or electronic device that opens or closes circuits, completes or breaks an electrical path, or selects paths or circuits, used to route traffic in a telecommunications network. Terra Router Terra Router or terabit router on the theory allows the network capacity on a scale of terabits 1 terabit = 1 million gigabits. TIMES Telecommunication, Information, Media, Edutainment and Service. TPE a normalized way to refer to transponder bandwidth it simple means how many transponders would be used if the same total bandwidths used only 36 Mt transponder 1 TPE = 36 MHz. UMTS Universal Mobile Telephone System, one of the 3G mobile systems being developed within the ITU 263 Statement of the Member of Board of Commissioners and Directors Regarding Responsibility for Annual Reporting 2015 Perusahaan Perseroan Persero PT Telekomunikasi Indonesia Tbk We hereby that all information has been fully disclosed in Annual Report 2015 Perusahaan Perseroan Persero PT Telekomunikasi Indonesia Tbk and we are solely responsible for the accuracy of the content. This statement is considered to be true and correct. Jakarta, March 28, 2016 Board of Commissioners Hendri Saparini President Commissioner Hadiyanto Commissioner Dolfie Othniel Fredric Palit Commissioner Margiyono Darsasumarja Commissioner Parikesit Suprapto Independent Commissioner Rinaldi Firmansyah Independent Commissioner

P. Pamela Johanna Waluyo

Independent Commissioner Board of Directors Alex J. Sinaga President Director Heri Sunaryadi Director of Finance Muhammad Awaluddin Director of Enterprise Business Service Indra Utoyo Director of Innovation Strategic Portfolio Dian Rachmawan Director of Consumer Abdus Somad Arief Director of Network IT Solution Herdy Rosadi Harman Director of Human Capital Management Honesti Basyir Director of Wholesale International Service Perusahaan Perseroan Persero PT Telekomunikasi Indonesia Tbk Pusat Pengelolaan Program Kemitraan Dan Program Bina Lingkungan Community Development Center Financial statements as of December 31, 2015 for the year then ended with independent auditors ’ report PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk PUSAT PENGELOLAAN PROGRAM KEMITRAAN DAN PROGRAM BINA LINGKUNGAN COMMUNITY DEVELOPMENT CENTER FINANCIAL STATEMENTS AS OF DECEMBER 31, 2015 AND FOR THE YEAR THEN ENDED WITH INDEPENDENT AUDITORS ’ REPORT Table of Contents Page SGM CDC The original report included herein is in Indonesian language. Independent Auditors ’ Report Report No. RPC-103PSS2016DAU The Shareholders, Board of Commissioners and Directors Perusahaan Perseroan Persero PT Telekomunikasi Indonesia Tbk Management of Pusat Pengelolaan Program Kemitraan dan Program Bina Lingkungan Community Development Center Perusahaan Perseroan Persero PT Telekomunikasi Indonesia Tbk We have audited the accompanying financial statements of Pusat Pengelolaan Program Kemitraan dan Program Bina Lingkungan Community Development Center Perusahaan Perseroan Persero PT Telekomunikasi Indonesia Tbk The original report included herein is in Indonesian language. Independent Auditors ’ Report continued Report RPC-103PSS2016DAU continued An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors 1 The original financial statements included herein are in Indonesian language. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA TBK PUSAT PENGELOLAAN PROGRAM KEMITRAAN DAN PROGRAM BINA LINGKUNGAN COMMUNITY DEVELOPMENT CENTER STATEMENT OF FINANCIAL POSITION December 31, 2015 Expressed in Rupiah Table of Contents Notes December 31, 2014 December 31, 2015 ASSETS Cash and Cash Equivalents 2b,4 164.471.231.080 119.512.444.975 Loan to other Foster SOE or Distributing Partners net of allowance for impairment losses of Rp11,444,509,078 2014: Rp11,607,929,078 2c,2d,5 10.486.580.000 4.999.999.996 Loan to Foster Partners net of allowance for impairment losses of Rp109,770,010,235 2014: Rp93,864,820,863 2c,2d,6a,6b 412.697.815.866 458.634.533.531 Fixed Asset Not in Use 7 - - Troubled Loan net of allowance for impairment losses of Rp82,673,017,234 2014: Rp77,773,183,407 2f,8 - - TOTAL ASSETS 587.655.626.946 583.146.978.502 LIABILITIES AND NET ASSETS LIABILITIES Other Current Liabilities 2j,9 - 10.972.947.055 Accrued Expenses 10 879.175.000 Unidentified Installments 2h,11 121.047.323 467.059.449 Overpayment of Installments 2i,12 1.313.285.449 158.652.706 Other Payables 2j,13 467.720.000 119.546.500 TOTAL LIABILITIES 2.781.227.772 11.718.205.710 NET ASSETS Unrestricted Net Assets 2k,14 584.874.399.174 571.428.772.792 TOTAL NET ASSETS 584.874.399.174 571.428.772.792 TOTAL LIABILITIES AND NET ASSETS 587.655.626.946 583.146.978.502 The accompanying notes form an integral part of these financial statements taken as a whole. 1 The original financial statements included herein are in Indonesian language. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA TBK PUSAT PENGELOLAAN PROGRAM KEMITRAAN DAN PROGRAM BINA LINGKUNGAN COMMUNITY DEVELOPMENT CENTER STATEMENT OF ACTIVITIES For the Year Ended December 31, 2015 Expressed in Rupiah Table of Contents Year Ended December 31, Notes 2014 2015 CHANGES IN UNRESTRICTED NET ASSETS REVENUE Loan Administration Service Income 15 38.881.631.441 17.874.573.518 Interest Income on Partnership Program 16a 9.656.400.307 1.566.703.122 Community Development Program 16b 7.139.747.899 3.048.273.583 Other Income 17 5.238.893.226 31.206.191 TOTAL REVENUE 60.916.672.873 22.520.756.414 EXPENSES Fostering Partnership Funds 18 15.294.716.793 6.014.476.847 Community Development Funds Distribution 19 - - Empowerment Expenses 20 5.101.507.680 2.289.880.645 General and Administration Expenses 21 12.985.184.323 5.584.101.195 Allowance for Impairment of Loan, net 6e 30.628.234.796 20.641.603.199 Rent Expenses 22 2.821.557.515 1.436.320.910 TOTAL EXPENSES 66.831.201.107 35.966.382.796 DECREASE IN UNRESTRICTED NET ASSETS FOR THE YEAR 5.914.528.234 13.445.626.382 DECREASE IN RESTRICTED NET ASSETS FOR THE YEAR - - DECREASE IN NET ASSETS FOR THE YEAR 5.914.528.234 13.445.626.382 AT BEGINNING OF YEAR 590.788.927.408 584.874.399.174 NET ASSETS AT END OF YEAR 584.874.399.174 571.428.772.792 The accompanying notes form an integral part of these financial statements taken as a whole. 1 The original financial statements included herein are in Indonesian language. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA TBK PUSAT PENGELOLAAN PROGRAM KEMITRAAN DAN PROGRAM BINA LINGKUNGAN COMMUNITY DEVELOPMENT CENTER STATEMENT OF CASH FLOWS For the Year Ended December 31, 2015 Expressed in Rupiah Table of Contents Year Ended December 31, 2014 2015 OPERATING ACTIVITIES Decrease in Net Assets for the year 5.914.528.235 13.445.626.382 Adjustments Allowance for Impairment of Loan, net 30.628.234.796 20.641.603.199 Other Income 1.825.352.893 - Change in asset and liability Loan to other Foster SOE or Distributing Partners 8.345.175.617 5.650.000.004 Loan to Fosters Partners 203.144.856.947 66.741.740.864 Other Receivable 847.074.513 - Other Current Liabilities - 10.972.947.055 Accrued Expense 879.175.000 879.175.000 Unidentified Installment 51.509.983 346.012.126 Overpayment of Installment 49.282.432 1.154.632.743 Other Payables 38.252.218.616 348.173.500 NET CASH FLOWS USED TO OPERATING ACTIVITIES 225.125.420.448 44.958.786.105 DECREASE IN CASH AND CASH EQUIVALENTS 225.125.420.448 44.958.786.105 CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 389.596.651.528 164.471.231.080 CASH AND CASH EQUIVALENTS AT END OF YEAR 164.471.231.080 119.512.444.975 The accompanying notes form an integral part of these financial statements taken as a whole. 1 The original financial statements included herein are in Indonesian language. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA TBK PUSAT PENGELOLAAN PROGRAM KEMITRAAN DAN PROGRAM BINA LINGKUNGAN COMMUNITY DEVELOPMENT CENTER NOTES TO THE FINANCIAL STATEMENTS December 31, 2015 and Year then Ended Expressed in Rupiah Table of Contents

1. INFORMATION OF COMMUNITY DEVELOPMENT CENTER UNIT