PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2012 AND FOR THE YEAR THEN ENDED
WITH COMPARATIVE FIGURES AS OF DECEMBER 31, 2011 AND FOR THE YEAR THEN ENDED AND AS OF JANUARY 1, 2011
Figures in tables are presented in billions of Rupiah, unless otherwise stated
114
44. FINANCIAL RISK MANAGEMENT continued
1. Financial risk management continued b. Market price risk
The Company and subsidiaries are exposed to changes in debt and equity market prices related to available-for-sale investments carried at fair value. Gains and losses arising from
changes in the fair value of available-for-sale investments are recognized in equity. The performance of the Company and subsidiaries’ available-for-sale investments are
monitored periodically, together with a regular assesment of their relevance to the Company and subsidiaries’ long-term strategic plans.
As of December 31, 2012, management considered the price risk for its available-for-sale investments to be immaterial in terms of the possible impact on profit or loss and total equity
from a reasonably possible change in fair value.
c. Interest rate risk Interest rate fluctuation is monitored to minimize any negative impact to financial position.
Borrowings at variable interest rates expose the Company and subsidiaries to interest rate risk Notes 16, 17, 18, 19 and 20. To measure market risk pertaining to fluctuations in
interest rates, the Company and subsidiaries primarily use interest margin and maturity profile of the financial assets and liabilities based on changing schedule of the interest rate.
At reporting date, the interest rate profile of the Company and subsidiaries’ interest-bearing borrowings was as follows:
2012 2011
Fixed rate borrowings 7,025
5,409 Variable rate borrowings
12,250 12,462
Sensitivity analysis for variable rate borrowings At December 31, 2012, a change of 25 basis points in interest rates of variable rate
borrowings would have increased decreased equity and profit or loss by Rp31 billion, respectively. This analysis assumes that all other variables, in particular foreign currency
rates, remain constant.
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2012 AND FOR THE YEAR THEN ENDED
WITH COMPARATIVE FIGURES AS OF DECEMBER 31, 2011 AND FOR THE YEAR THEN ENDED AND AS OF JANUARY 1, 2011
Figures in tables are presented in billions of Rupiah, unless otherwise stated
115
44. FINANCIAL RISK MANAGEMENT continued
1. Financial risk management continued d. Credit risk
The following table presents the maximum exposure to credit risk of the Company and subsidiaries’ financial assets:
2012 2011
Cash and cash equivalents 13,118
9,634 Other current financial assets
4,338 373
Trade and other receivables, net 5,409
5,250 Long-term investments
21 21
Advances and other non-current assets 614
218
Total 23,500
15,496
The Company and subsidiaries are exposed to credit risk primarily from trade receivables and other receivables. The credit risk is managed by continuous monitoring of outstanding
balances and collection of trade and other receivables.
Trade and other receivables do not include any major concentration of credit risk by customer. Each of the top three customers account for less than 1 of the trade receivables
as at December 31, 2012. Management is confident in its ability to continue to control and sustain minimal exposure to
credit risk given that the Company and subsidiaries have provided sufficient provision for impairment of receivables to cover incurred loss arising from uncollectible receivables based
on existing historical data on credit losses.
e. Liquidity risk Liquidity risk arises in situations where the Company and subsidiaries have difficulties in
fulfilling financial liabilities when they become due. Prudent liquidity risk management implies maintaining sufficient cash and cash equivalents in
order to meet the Company and subsidiaries’ financial obligations. The Company and subsidiaries continuously perform an analysis to monitor financial position ratios, among
other things, liquidity ratios, debt equity ratios against debt covenant requirements.
The following is the maturity profile of the Company and subsidiaries’ financial liabilities:
Carrying Contractual 2017 and
amount cash flows 2013
2014 2015
2016 thereafter
December 31, 2012 Trade and other payables
7,456 7,456
7,456 -
- -
- Accrued expenses
6,163 6,163
6,163 -
- -
- Loans and other borrowings
Bank loans 11,295
12,585 5,118
3,869 2,518
602 478
Obligations under finance leases
2,324 3,172
652 548
398 354
1,220 Two-step loans
1,987 2,462
283 277
270 263
1,369 Bonds and notes
3,669 5,462
757 505
1,287 203
2,710
Total 32,894
37,300 20,429
5,199 4,473
1,422 5,777
