PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2016 and for the Year Then Ended
Figures in tables are expressed in billions of Rupiah, unless otherwise stated Table of Content
37. FINANCIAL RISK MANAGEMENT continued
1. Fair value of financial assets and financial liabilities continued b. Fair Value continued
Fair value measurement at reporting date using
2015 Carrying
value Fair Value
Quoted prices in active
markets for identical assets
or liabilities level 1
Significant other
observable inputs
level 2 Significant
unobservable inputs
level 3 Financial assets measured at fair value
Available-for-sale investment 160
160 55
105 -
Fair value through profit or loss 172
172 -
- 172
Total 332
332 55
105 172
Financial liabilities for whichfair value are disclosed
Interest-bearing loans and other borrowings Two-step loans
1,520 1,538
- -
1,538 Bonds and notes
9,548 9,541
8,972 -
569 Long-term bank loans
18,362 18,314
- -
18,314 Obligation under finance lease
4,580 4,580
- -
4,580
Total 34,010
33,973 8,972
- 25,001
Available-for-sale financial assets primarily consist of mutual funds, and Corporate and Government bonds. Mutual funds actively traded in an established market are stated at Fair
Value using quoted market price and classified within level 1. Corporate and Government bonds are stated at fair value by reference to prices of similar securities at the reporting date.
Valuation of put option needs significant judgement from management because there is no market price quotation and lack of comparable instruments available in the market.As they are
not actively traded in an established market, these securities are classified as level 2. Financial asset at fair value through profit or loss represents the Put Option on the 20
remaining ownership in Indonusa which was received as part of the divestment considerations. The valuation of put option requires significant management judgement due to
the absence of quoted market prices and the lack of comparable instruments in the market. As the put option is subject to restrictions on redemption such as transfer restrictions and initial
lock-up periods and observable activity for the investment is limited, this investment is therefore classified within level 3 of the fair value hierarchy.
Reconciliations of the beginning and ending balances for items measured at fair value using significant unobservable inputs level 3 as of December 31, 2016 and 2015 are as follows:
2016 2015
Beginning balance 172
290 Unrealized loss - recognized in the consolidated statements of profit or
loss and other comprehensive income 172
118
Ending balance -
172
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2016 and for the Year Then Ended
Figures in tables are expressed in billions of Rupiah, unless otherwise stated Table of Content
37. FINANCIAL RISK MANAGEMENT continued
