PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2008 and 2007 Expressed in millions of Rupiah, unless otherwise stated
85
27. TAXATION continued c. Tax expense - current continued
Under the Indonesian taxation laws, Bank Mandiri and its Subsidiaries submit tax return on the basis of self assessment. The tax authorities may assess or amend taxes within 5 years after the date of
the tax filings. In September 2008, the Government announced the changes of Law No. 7 Year 1983 regarding
“Income Tax” which will be effective on January 1, 2009 which is Law No. 36 Year 2008 regarding revision for the fourth time of Law No. 7 Year 1983 on Income Tax. The revised Law stipulates
changes in corporate tax rate from a marginal tax rate to a single rate of 28 for fiscal year 2009 and 25 for fiscal year 2010 onwards.
d. Tax expense - deferred
The reconciliation between estimated income tax expense, calculated using applicable tax rates based on commercial income before tax expense, and estimated income tax as reported in the
statements of income for the years ended December 31, 2008 and 2007 are as follows:
2008 2007
Consolidated income before tax expense and minority interests 8,068,560
6,333,383 Less: Income before tax expense of Subsidiaries after elimination
141,244 134,525
Income before tax expense and minority interests - Bank Mandiri only 7,927,316
6,198,858 Estimated income tax expense based on standard statutory rates
2,378,177 1,859,640
Decreaseincrease of deferred tax from changes of taxes rates and recognition of temporary difference not recognized in prior years
184,952 -
Tax effect of permanent differences: Non-deductible expenses
56,861 15,731
Losses from Hong Kong branch 18,710
- Others
10,640 4,537
Recovery of credit 34,845
27,274 236,318
7,006
Tax expense - Bank Mandiri only 2,614,495
1,852,634 Tax expense - Subsidiaries
138,749 133,258
Tax expense - consolidated 2,753,244
1,985,892 Less: Current tax expense - consolidated
4,711,894 2,686,154
Deferred tax benefit - Consolidated 1,958,650
700,262
PT BANK MANDIRI PERSERO TBK. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Years Ended December 31, 2008 and 2007 Expressed in millions of Rupiah, unless otherwise stated
86
27. TAXATION continued e. Deferred Tax Assets
The tax effects from temporary differences between commercial and tax bases are as follows:
2008 2007
Bank Mandiri Deferred tax assets:
Loans write-offs 3,605,776
2,276,445 Allowance for possible losses on earning assets other than loans
872,525 659,274
Allowance for possible loan losses 777,476
429,374 Provision for personnel expenses
665,157 599,122
Estimated losses on commitments and contingencies 87,889
140,394 Allowance for possible losses arising from legal cases-net of provision
for deferred tax asset of Rp24,253 and Rp38,926 for the years ended December 31, 2008 and 2007
25,073 22,614
Provision for abandoned properties 10,641
13,833 Provision for repossessed assets
6,675 7,150
Accumulated losses arising from difference in net realizable value of abandoned properties
5,963 8,774
Accumulated losses arising from difference in net realizable value of repossessed assets
2,926 3,135
Unrealized loss for securities and Government Recapitalization Bonds available for sale
66,233 1,521
Deferred tax assets 6,126,334
4,161,636 Deferred tax liabilities:
Net book value of premises and equipment 44,464 81,161
Mark to market of securities - 7
Net deferred tax assets - Bank Mandiri only 6,081,870
4,080,468 Net deferred tax assets - Subsidiaries
42,049 15,979
Total consolidated deferred tax assets - net 6,123,919
4,096,447
Deferred tax assets is calculated using applicable tax rate or substantially enacted tax rate at balance sheet dates.
28. OTHER LIABILITIES
2008 2007
Rupiah: Provision for post-employment benefits Note 42
925,002 784,938
Provision for free-of service period benefits Note 42 794,159
655,489 Accrued bonus, employee incentives, leave and holiday
775,927 647,930
Payable to customer 483,824
557,822 Guarantee deposits
466,130 527,347
Unearned Income 368,933
351,257 Provision for possible losses on legal cases Note 56d 157,560
204,611 Others
1,897,308 2,681,784
Total Rupiah 5,868,843
6,411,178 Foreign Currency:
Guarantee deposits 440,451
565,340 Unearned Income
198,791 199,043
Provision for possible losses on legal cases Note 56d 18,756
1,131 Obligation under capital lease
2,248 -
Inter-branch accounts - net -
159,328 Others
1,470,279 2,288,011
Total Foreign Currency 2,130,525
3,212,853 7,999,368
9,624,031
