PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2014 and for the Six Months Period Then Ended unaudited
Figures in tables are expressedin billions of rupiah, unless otherwise stated
53
11. PROPERTY AND EQUIPMENT continued
c. Others continued vi The Company and subsidiaries own several pieces of land rights located throughout
Indonesia with Building Use Rights “Hak Guna Bangunan” or “HGB” for a period of 10 – 45 years which will expire between 2014 and 2053. Management believes that there will
be no issue in obtaining the extension of the land rights when they expire.
vii As of June 30, 2014, the Company and subsidiaries’ property and equipment except land rights, with net carrying amount of Rp78,121 billion were insured against fire, theft,
earthquake and other specified risks, with a maximum loss claim of Rp6,139 billion, US7,469 million, EUROnil million, SGD21.55 million and HKD18.61 million, and on a first
loss basis of Rp6,815 billion including business recovery of Rp324 billion with the Automatic Reinstatement of Loss Clause. In addition, Telkom-1 and Telkom-2 were insured separately
for US3.41 million and US28.55 million, respectively. Management believes that the insurance coverage is adequate to cover potential losses from the insured risks.
viii As of June 30, 2014, the percentage of completion of property under construction was around 44.42 of the total contract value, with estimated dates of completion between
July 2014 and December 2015. The balance of property under construction mainly consists of buildings, transmission installation and equipment, cable network and power supply.
Management believes that there is no impediment to the completion of the construction in progress.
ix All assets owned by the Company have been pledged as collateral for bonds Note 20a. Certain property and equipment of the Company’s subsidiaries with gross carrying value
amounting to Rp6,205 billion have been pledged as collateral under lending agreements Notes 17 and 21.
x As of June 30, 2014 and December 31, 2013 the cost of fully depreciated property and equipment of the Company and subsidiaries that are still used in operations amounted to
Rp38,963 billion and Rp40,791 billion. The Company and subsidiaries are currently performing modernization of network assets to replace the fully depreciated property and
equipment.
xi The Company and Telkomsel entered into several agreements with PT Profesional Telekomunikasi Indonesia, PT Tower Bersama Infrastructure Tbk, PT Solusindo Kreasi
Pratama, PT Prima Media Selaras, PT Naragita Dinamika Komunika and other tower providers to lease spaces in telecommunication towers slot and sites of the towers for a
period of 10 years. The Company and Telkomsel may extend the lease period based on the agreement by both parties. In addition, the Company and subsidiaries also have lease
commitments for property and equipment under RSA, transmission installation and equipment, data processing equipment, office equipment, vehicles and CPE assets with the
option to purchase certain leased assets at the end of the lease terms.
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2014 and for the Six Months Period Then Ended unaudited
Figures in tables are expressedin billions of rupiah, unless otherwise stated
54
11. PROPERTY AND EQUIPMENT continued
