PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2016 and For the Nine-Month Period Then Ended unaudited
Figures in tables are expressed in billions of rupiah, unless otherwise stated
42
9. PROPERTY AND EQUIPMENT continued
January 1, 2015
Additions Deductions
Reclassifications Translations
December 31, 2015
At cost: Directly acquired assets
Land rights 1,184
86 -
- 1,270
Buildings 4,571
263 -
1,199 6,033
Leasehold improvements 943
41 151
203 1,036
Switching equipment 19,208
126 66
555 19,823
Telegrap, telex and data communication equipment 6
870 -
- 876
Transmission installation and equipment 107,573
4,278 2,318
9,514 119,047
Satellite, earth station and equipment 7,927
93 1
127 8,146
Cable network 33,114
4,458 227
542 37,887
Power supply 12,776
381 92
757 13,822
Data processing equipment 10,242
408 58
759 11,351
Other telecommunications peripherals 602
37 -
7 632
Office equipment 951
150 46
7 1,062
Vehicles 346
135 2
4 475
Other equipment 99
- -
- 99
Property under construction 3,853
14,623 -
13,896 4,580
Assets under finance lease
Transmission installation and equipment 5,882
260 202
- 5,940
Data processing equipment 102
- 39
- 63
Office equipment 21
52 -
- 73
Vehicles 44
50 -
- 94
CPE assets 22
- -
- 22
Power supply -
90 -
- 90
RSA assets 252
- -
- 252
Total 209,718
26,401 3,202
244 232,673
January 1, 2015
Additions Deductions
Reclassifications Translations
December 31, 2015
Accumulated depreciation and impairment losses: Directly acquired assets
Buildings 1,954
183 -
4 2,141
Leasehold improvements 669
105 151
- 623
Switching equipment 13,861
1,441 62
17 15,223
Telegraph, telex and data communication equipment 4
- -
- 4
Transmission installation and equipment 54,764
10,575 2,290
14 63,063
Satellite, earth station and equipment 6,099
607 1
1 6,706
Cable network 18,762
1,327 225
340 19,524
Power supply 7,978
1,250 85
29 9,114
Data processing equipment 7,624
940 58
3 8,503
Other telecommunications peripherals 322
70 -
7 385
Office equipment 659
107 45
8 713
Vehicles 113
57 1
3 166
Other equipment 97
2 -
- 99
Assets under finance lease
Transmission installation and equipment 1,681
848 202
- 2,327
Data processing equipment 79
13 39
- 53
Office equipment 6
45 -
- 51
Vehicles 5
8 -
- 13
CPE assets 15
2 -
- 17
Power supply -
18 -
- 18
RSA assets 217
13 -
- 230
Total 114,909
17,611 3,159
388 128,973
Net Book Value 94,809
103,700
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2016 and For the Nine-Month Period Then Ended unaudited
Figures in tables are expressed in billions of rupiah, unless otherwise stated
43
9. PROPERTY AND EQUIPMENT continued
a. Gain on disposal or sale of property and equipment
2016 2015
Proceeds from sale of property and equipment 735
313 Net book value
17 26
Gain on disposal or sale of property and equipment 718
287
b. Asset impairment As of December 31, 2015 and 2014, the CGUs that independently generate cash inflows were fixed
wireline, fixed wireless, cellular and others. In 2014, the Group decided to cease its fixed wireless business no later than December 15, 2015.
The Company assessed the recoverable amount to be Rp549 billion and determined that the assets for fixed wireless CGU were further impaired by Rp805 billion. The recoverable amount has been
determined based on VIU calculation using the most recent cash flows projection approved by management. The cash flows projection included cash inflows from the continuing use of the assets
during the remaining service period and projected net cash flows to be received for the disposal of the assets for fixed wireless CGU at the end of service period. Projected net cash flows to be
received for the disposal of the assets was determined based on cost approach, adjusted for physical, technological and economic obsolescence. Management applied a pre-tax discount rate
of 13.5 derived from the Company’s post-tax weighted average cost of capital and benchmarked to externally available data. In addition, management also applied technological and economic
obsolescence rate of 30 based on the Company’s internal data, due to the lack of comparable market data because of the nature of the assets. The determination of VIU calculation is most
sensitive to technological and economic obsolescence rate assumption. An increase in technological and economic obsolescence rate to 40 would result in a further impairment of
Rp70 billion. Loss on impairment of assets was recognized within “Depreciation and Amortization” in the
consolidated statement of profit or loss and other comprehensive income. In connection with the restructuring of fixed wireless business Note 35c.ii, the Company
accelerated its depreciation of fixed wireless assets. As of December 31, 2015, all of the Company’s fixed wireless assets have been fully depreciated.
Management believes that there is no indication of impairment in the assets of other CGUs as of December 31, 2015.
c. Others i
Interest capitalized to property under construction amounted to Rp423 billion and Rp302 billion for the nine-month periods ended September 30, 2016 and 2015, respectively. The
capitalization rate used to determine the amount of borrowing costs eligible for capitalization ranged from 7.42 to 11.00 and 9.74 to 18.31 for the nine-month periode ended
September 30, 2016 and 2015, respectively.
ii No foreign exchange loss was capitalized as part of property under construction for the nine- month periods ended September 30, 2016 and for the year ended December 31, 2015.
