PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued SEPTEMBER 30, 2005 AND 2006, AND FOR THE NINE MONTHS PERIOD ENDED
SEPTEMBER 30, 2005 AND 2006 Figures in tables are presented in millions of Rupiah, unless otherwise stated
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
k. Property, plant and equipment – direct acquisitions
Property, plant and equipment directly acquired are stated at cost, except for certain revalued assets, less accumulated depreciation and impairment losses.
Property, plant and equipment, except land, are depreciated using the straight-line method, based on the estimated useful lives of the assets as follows:
Years
Buildings 20
Switching equipment 5—15
Telegraph, telex and data communication equipment 5—15
Transmission installation and equipment 5—20
Satellite, earth station and equipment 3—15
Cable network 5—15
Power supply 3—10
Data processing equipment 3—10
Other telecommunications peripherals 5
Office equipment 3—5
Vehicles 5—8
Other equipment 5
Land is stated at cost and is not depreciated. When the carrying amount of an asset exceeds its estimated recoverable amount, the asset is
written down to its estimated recoverable amount, which is determined based upon the greater of its net selling price or value in use.
The cost of maintenance and repairs is expensed as incurred. Expenditures, which extend the useful life of the asset or result in increased future economic benefits such as increase in capacity
or improvement in the quality of output or standard of performance, are capitalized and depreciated based on the remaining useful life.
When assets are retired or otherwise disposed of, their carrying values and the related accumulated depreciation are eliminated from the consolidated financial statements, and the resulting gains or
losses on the disposal or sale of property, plant and equipment are recognized in the statement of income.
Computer software used for data processing is included in the value of the associated hardware. Property under construction is stated at cost until construction is complete, at which time it is
reclassified to the specific property, plant and equipment account to which it relates. During the construction period, borrowing costs, which include interest expense and foreign exchange
differences incurred to finance the construction of the asset, are capitalized in proportion to the average amount of accumulated expenditures during the period. Capitalization of borrowing cost
ceases when the assets are ready for its intended use.
PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued SEPTEMBER 30, 2005 AND 2006, AND FOR THE NINE MONTHS PERIOD ENDED
SEPTEMBER 30, 2005 AND 2006 Figures in tables are presented in millions of Rupiah, unless otherwise stated
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
