PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 516 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
c. Financial instruments continued A. Financial assets continued
a Financial assets at fair value through profit or loss continued
Financial instruments included in this category are recognised initially at fair value; transaction costs are taken directly to the consolidated statement of income. Gains and
losses arising from changes in fair value and sales of these financial instruments are included directly in the consolidated statement of comprehensive income and are reported
respectively as “Unrealised gainslosses from increasedecrease in fair value of financial instruments” and “Gainslosses from sale of financial instruments”. Interest income on
financial instruments held for trading are included in “Interest income”. 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, other than:
- those that the Group intends to sell immediately or in the short term, which are classified as held for trading, and those that the Group upon initial recognition designates as at fair
value through profit or loss; - those that the Group upon initial recognition designates as available for sale; or
- those for which the Group may not recover substantially all of its initial investment, other than because of loans and receivables deterioration.
Loans and receivables are initially recognised at fair value plus transaction costs and subsequently measured at amortised cost using the effective interest rate method. Income
on financial assets classified as loans and receivables is included in the consolidated statement
of income and is reported as “Interest income”. In the case of impairment, the impairment loss is reported as a deduction from the carrying value of the financial assets
classified as loan and receivables and recognised in the consolidated statement of income as “Allowance for impairment losses”.
c Held-to-maturity financial assets Held-to-maturity financial assets are non-derivative financial assets with fixed or
determinable payments and fixed maturities that the Group has the positive intention and ability to hold to maturity, other than:
- those that the Group upon initial recognition designates as at fair value through profit or loss;
- those that the Group designates as available for sale; and - those that meet the definition of loans and receivables.
Held-to-maturity financial assets are initially recognised at fair value including transaction costs and subsequently measured at amortised cost, using the effective interest method.
Interest income on held-to-maturity financial assets is included in the consolidated
statement of income and reported as “Interest income”. In the case of impairment, the impairment loss is reported as a deduction from the carrying value of the investment and
recognised in the consolidated f inancial statements as “Allowance for impairment losses”.
d Available-for-sale financial assets Available-for-sale are 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 or
financial assets at fair value through profit or loss.
