NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued JUNE 30, 2012 UNAUDITED AND DECEMBER 31, 2011 AUDITED
AND SIX MONTHS PERIOD ENDED JUNE 30, 2012 AND 2011 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated
37
5. INVENTORIES continued
The cost of inventories recognised as expense and included in operations, maintenance, and telecommunication services expenses Note 27 as of June 30, 2012 and December 31, 2011
amounted to Rp.359 billion and Rp.818 billion, respectively. Management believes that the provision is adequate to cover losses from declines in inventory value
due to obsolescence. Certain inventories of the Company’s subsidiaries have been pledged as collateral for lending
agreements Notes 15 and 19. As of June 30, 2012 and December 31, 2011 , modules and components held by the Company and
its subsidiaries have been insured against fire, theft, all industrial risks, loss risk during delivery and other specific risks with the total sum insured as of June 30, 2012 and December 31, 2011 is
amounting to Rp.241 billion and Rp.235 billion, respectively. Management believes that the insurance coverage is adequate to cover potential losses of the
insured inventories.
6. ADVANCES AND PREPAID EXPENSES
June 30, December 31,
2012 2011
Frequency license Notes 40c.i and 40c.iii 1,354
2,211 Rental
848 530
Salaries 454
201 Advances
215 184
Others each below Rp.50 billion 158
168
Total 3,029
3,294
Refer to Note 36 for details of related party transactions. 7. ASSETS HELD FOR SALE
This account represents the carrying amount of Telkomsel’s equipment to be exchanged with equipment of Nokia Siemens Network Oy “NSN Oy” and PT Huawei Tech Investment “PT
Huawei”. The amount will be used as a part of the settlement for acquisition of equipment from those companies.
In 2012, the Telkomsel’s equipment with a net carrying amount of Rp.403 billion were exchanged to NSN Oy and PT Huawei.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued JUNE 30, 2012 UNAUDITED AND DECEMBER 31, 2011 AUDITED
AND SIX MONTHS PERIOD ENDED JUNE 30, 2012 AND 2011 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated
38
8. LONG-TERM INVESTMENTS
June 30, 2012 Share of
loss Percentage
profit of of
Beginning associated Translation
Ending ownership balance company Dividend adjustment
balance Long-term investments
in associated companies:
Scicom
a
29.71 101
1 3
9 88
Patrakom
b
40.00 43
1 -
- 44
PT Melon Indonesia “Melon”
c
51.00 44
3 -
- 41
CSM
d
25.00 26
- -
- 26
PSN
e
22.38 -
- -
- -
214 3
3 9
199
Other long-term investments 21
- -
- 21
235 3
3 9
220 December 31, 2011
Share of loss
Percentage profit of
of Beginning
associated Translation Ending
ownership balance Addition company adjustment balance
Long-term investments in associated companies:
Scicom
a
29.71 109
1 7
101 Melon
c
51.00 51
7 -
- 44
Patrakom
b
40.00 40
4 1
- 43
CSM
d
25.00 33
6 -
1 26
PSN
e
22.38 -
- -
- -
233 10
8 1
214
Other long-term investments 21
- -
- 21
254 10
8 1
235
a
Scicom is engaged in providing call center services in Malaysia.
b
Patrakom is engaged in providing satellite communication system services, related services and facilities to companies in the petroleum industry.
c
Melon is engaged in providing Digital Content Exchange Hub services “DCEH”. As a result of the existence of substantive participating rights held by the other venturer over the significant financial
and operating policies of Melon, Metra does not have control over Melon.
d
CSM is engaged in providing Very Small Aperture Terminal “VSAT”, network application services and consulting services on telecommunications technology and related facilities.
e
PSN is engaged in providing satellite transponder leasing and satellite-based communication services in the Asia Pacific region. The Company’s share in losses in PSN has exceeded the
carrying amount of its investment since 2001, accordingly, the investment value has been reduced to Rp.nil.
