PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED continued JUNE 30, 2009 AND 2010
SIX MONTHS PERIOD ENDED JUNE 30, 2009 AND 2010 Figures in tables are presented in millions of Rupiah, unless otherwise stated
24
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued k. Property, plant and equipment - direct acquisitions continued
Spare parts and servicing equipment are carried as inventory and recognized in profit or loss as consumed. Major spare parts and stand-by equipment that are expected to be used for more than
12 months are recorded as part of property, plant and equipment.
When assets are retired or otherwise disposed of, their cost 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 consolidated statement of income.
Certain computer hardware cannot be used without the availability of certain computer software. In such circumstance, the computer software is recorded as part of the computer hardware. If any
computer software is independent from its computer hardware, it is recorded as part of intangible assets.
The cost of maintenance and repairs is charged to the consolidated statement of income as incurred. Significant renewals and betterments are capitalized.
Property under construction is stated at cost until construction is completed, at which time it is reclassified to the specific property, plant and equipment account to which it relates. During the
construction period until the property is ready for its intended use or sale, borrowing costs, which include interest expense and foreign currency 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 construction
has been completed and the asset is ready for its intended use.
Equipment temporarily unused is reclassified into equipment not used in operation and depreciated over their estimated useful life using straight-line method.
l. Property, plant and equipment under finance leases
Since January 1, 2008, the Company and its subsidiaries have adopted PSAK 30 Revised 2007, “Lease” “PSAK 30R”, which became effective for financial statement periods beginning
on or after January 1, 2008.
Based on PSAK 30R, a lease is classified as a finance lease or operating lease based on the substance not the form of the contract. Property, plant and equipment under finance lease is
recognized if the lease transfers substantially all the risks and rewards incidental to ownership. Statement of Financial Accounting Standards Interpretation Interpretasi Pernyataan Standar
Akuntansi Keuangan or “ISAK” 8, “Determining Whether an Arrangement Contains a Lease and Further Discussion on Transitional Provisions of PSAK 30 Revised 2007”, requires the
Company and its subsidiaries to apply PSAK 30R retrospectively to all lease transactions since the commencing dates of the related agreement or prospectively as if the standard applied since
the beginning of reporting periods. The Company has decided to select the prospective application. The cumulative effect was charged to the 2008 consolidated income statements as
the impact of the standard to the prior year was insignificant.
PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED continued JUNE 30, 2009 AND 2010
SIX MONTHS PERIOD ENDED JUNE 30, 2009 AND 2010 Figures in tables are presented in millions of Rupiah, unless otherwise stated
25
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued l. Property, plant and equipment under finance leases continued
Finance leases are recognized as assets and liabilities in the balance sheets as the amounts equal to the fair value of the leased property or, if lower, the present value of the minimum lease
payments. Any initial direct costs of the Company and its subsidiaries are added to the amount recognized as an asset.
Minimum lease payments shall be apportioned between the finance charge and the reduction of the outstanding liability. The finance charge shall be allocated to each period during the lease
term so as to produce a constant periodic rate of interest on the remaining balance of the liability. Contingent rents shall be charged as expenses in the periods in which they are incurred.
Leased assets are depreciated using the same method over the shorter of the lease term and their economic useful life.
Leasing arrangements that do not meet the above criteria are accounted for as operating leases for which payments are charged as an expense on the straight-line basis over the lease period.
m. Revenue-Sharing Arrangements RSA
Previously, the Company records assets under RSA as “Property, plant and equipment under RSA” and credited the “Unearned income on RSA” which was presented in the liabilities section
amounted to the cost spent by the investor as agreed in the agreements between the Company and investor. With the abolition of PSAK 35 Note 2q.viii, RSA transaction is recorded in
accordance with PSAK 30 Revised 2007. “RSA liabilities under capital lease” is recognized as the substitute of “Unearned income on RSA” amounted to the estimated present value of the
payment to investors.
Property, plant and equipment under RSA are depreciated using the straight-line method based on the estimated useful life of each asset. At the end of the revenue-sharing period, the property,
plant and equipment under RSA is reclassified to the “Property, plant and equipment” account.
All revenues received from RSA is recognized as part of revenues from operating, while part of revenues provided to the investors is recorded as interest expense and presented as deduction of
RSA liabilities.
n. Joint Operation Schemes “Kerja Sama Operasi” or “KSO”
Revenues from KSO include amortization of unearned initial investor payments, Minimum Telkom Revenues “MTR” and the Companys share of Distributable KSO Revenues “DKSOR”.
Unearned initial investor payments received are recorded net of all direct costs incurred in connection with the KSO agreement and are amortized using the straight-line method over the
KSO period of 15 years starting from January 1, 1996.
