ALLOWANCEREVERSAL FOR POSSIBLE LOSSES
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 5134 50. EMPLOYEE BENEFITS continued
Pension Plan continued
b. Four defined benefit pension funds, Dana Pensiun Pemberi Kerja Program Pensiun Manfaat Pasti DPPK-PPMP which were derived from the respective pension plans of the ex-legacy Merged
Banks, namely Dana Pensiun Bank Mandiri Satu or DPBMS BBD, DPBMD BDN, DPBMT Bank Exim and DPBME Bapindo. The regulations of the respective pension plans were approved by
the Minister o f Finance of the Republic of Indonesia’s through its decision letters No. KEP-
394KM.0171999, No. KEP-395KM.0171999,
No. KEP-396KM.0171999 and
No. KEP- 397KM.0171999 all dated 15 November 1999. Based on the approval from shareholders No. S-
923M-MBU2003 dated 6 March 2003, Bank Mandiri has adjusted pension benefits for each Pension Fund. Such approval has been incorporated in each of the Pension Fund’s Regulations
Peraturan Dana Pensiun PDP which have been approved by the Minister of Finance of the Republic of Indonesia based on its decision letters No. KEP115KM.62003 for PDP DPBMS,
No. KEP116KM.62003 for PDP DPBMD, No. KEP117KM.62003 for PDP DPBMT, and No. KEP118KM.62003 for DPBME, all dated 31 March 2003.
The members of the defined benefit pension plans are the employees from the legacy banks who have rendered three or more services years at the time of merger and are comprise of active
employees of the Bank, former employee those who have resigned and did not transfer their beneficial right to other pension plan and pensioners.
Based on the decision of the General Meeting of Shareholders dated 28 May 2007, Bank Mandiri increased the pension benefit from each of the Pension Plans. The decision was stated in each
Pension Plan Regulation and has been approved by the Minister of Finance of the Republic of Indonesia with decision letter No. KEP-144KM.102007 DPBMS; No. KEP-145KM.102007
DPBMD; No. KEP-146KM.102007 DPBMT and No. KEP-147KM.102007 DPBME, all dated 20 July 2007.
Based on the approval of the General Meeting of Shareholders AGM on 17 May 2010, Bank Mandiri increased the retirement benefits of each pension fund. Decision to increase pension
benefits was set forth in the Regulation of Pension Fund respectively and approved by the Minister of Finance Decree No. KEP-441KM.102010 dated 10 August 2010 DPBMS; No. KEP-
442KM.102010 dated 10 August 2010 DPBMD; No. KEP-443KM.102010 dated 10 August 2010 DPBMT and No. KEP-444KM.102010 dated 10 August 2010 DPBME.
Based on the approval of the General Meeting of Shareholders AGM on 23 May 2011, Bank Mandiri increased the retirement benefits of each pension fund. Decision to increase pension
benefits was set forth in the Regulation of Pension Fund respectively and has been approved by the Minister of Finance Decree No. KEP-588KM.102011 dated 20 July 2011 DPBMS; No. KEP-
589KM.102011 dated 20 July 2011 DPBMD; No. KEP-590KM.102011 dated 20 July 2011 DPBMT and No. KEP-591KM.102011 dated 20 July 2011 DPBME.
Based on the approval of the General Meeting of Shareholders AGM on 2 April 2013, Bank Mandiri increased the retirement benefits of each pension fund. Decision to increase pension
benefits was set forth in the Regulation of Pension Fund respectively and has been approved by the Minister of Finance Decree No. KEP-349NB.12013 dated 14 June 2013 DPBMS; No. KEP-
350NB.12013 dated 14 June 2013 DPBMD; No. KEP-351NB.12013 dated 14 June 2013 DPBMT and No. KEP-352NB.12013 dated 14 June 2013 DPBME.
As at 31 December 2013 and 2012, the provision for pension benefit obligation are calculated by the independent actuary as shown in the independent actuarial report of PT Dayamandiri
Dharmakonsilindo dated 13 January 2014 for the year ended 31 December 2013 and the independent actuarial report of PT Dayamandiri Dharmakonsilindo dated 21 January 2013 for the
year ended on 31 December 2012. The assumptions used for the years ended 31 December 2013 and 2012 are as follows:
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 5135 50. EMPLOYEE BENEFITS continued
Pension Plan continued
DPBMS DPBMD
DPBMT DPBME
Discount rate 9.15 per annum
2012: 6.40 9.15 per annum
2012: 6.40 9.15 per annum
2012: 6.40 9.15 per annum
2012: 6.40 Expected rate of
return on pension plan assets
9.50 per annum 2012: 8.75
9.00 per annum 2012: 9.25
8.50 per annum 2012: 8.00
9.00 per annum 2012: 8.00
Working period used As at 31 July 1999
As at 31 July 1999 As at 31 July 1999
As at 31 July 1999 Pensionable salary
PhDP used Last month salary of 31
July 1999, which adjusted on 31 December 2002
Last month salary of 31 July 1999, which adjusted on 31
December 2002 Last month salary of 31 July
1999, which adjusted on 31 December 2002
Last month salary of 31 July 1999, which adjusted
on 31 December 2002 Expected rates of
PhDP increase Nil
Nil Nil
Nil Mortality Rate Table
2013 and 2012: Indonesian Mortality Table
2011 TMI III for employee and former employee and
Group Annuity Mortality 1983 GAM ’83 for
pensioners 2013 and 2012:
Indonesian Mortality Table 2011 TMI III for employee
and former employee and Group Annuity Mortality
1983 GAM ’83 for pensioners
2013 and 2012: Indonesian Mortality Table
2011 TMI III for employee and former employee and
Group Annuity Mortality 1983 GAM ’83 for
pensioners 2013 and 2012:
Indonesian Mortality Table 2011 TMI III for employee
and former employee and Group Annuity Mortality
1983 GAM ’83 for pensioners
Turnover rate 2013 and 2012:
5.00 for employees’ age of 25 and decreasing linearly
by 0.167 each year up to 0.00 age 55 and after
2013 and 2012: 5.00 for employees’ age of
25 and decreasing linearly by 0.167 each year up to
0.00 age 55 and after 2013 and 2012:
5.00 for employees’ age of 25 and decreasing linearly
by 0.167 each year up to 0.00 age 55 and after
2013 and 2012: 5.00 for employees’ age of
25 and decreasing linearly by 0.167 each year up to
0.00 age 55 and after Disability rate
2013 and 2012: 10.00 of TMI III
2013 and 2012: 10.00 of TMI III
2013 and 2012: 10.00 of TMI III
2013 and 2012: 10.00 of TMI III
Actuarial method Projected Unit Credit
Projected Unit Credit Projected Unit Credit
Projected Unit Credit Normal retirement age
48 years to 56 years depending on the
grades 56 years for all
grades 56 years for all
grades 56 years for all
grades Maximum defined
benefit amount 80.00 of PhDP
80.00 of PhDP 62.50 of PhDP
75.00 of PhDP Expected rate of
pension benefit increase
Nil Nil
Nil 2.00 per year
Tax rates - average 2013 and 2012:
3.00 of pension benefit 2013 and 2012:
3.00 of pension benefit 2013 and 2012:
3.00 of pension benefit 2013 and 2012:
3.00 of pension benefit
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 5136 50. EMPLOYEE BENEFITS continued
Pension Plan continued
The projected benefit obligations and fair value of plan assets as at 31 December 2013, based on independent actuarial report, are as follows:
DPBMS DPBMD
DPBMT DPBME
Projected benefit obligations
1,215,780 1,472,346
589,041 422,773
Fair value of plan assets 1,540,476
1,770,137 816,426
551,037 Funded Status
324,696 297,791
227,385 128,264
Unrecognised past service cost
- -
- -
Unrecognised actuarial gains
279,941 268,790
213,160 65,822
Surplus based on SFAS No. 24
44,755 29,001
14,225 62,442
Asset ceiling -
- -
-
Pension Plan Program Assets recognised in
statements of financial position
- -
- -
There are no unrecognised accumulated actuarial loss-net nor unrecognised past service cost and there are no present value of available future refunds or reductions of future contributions.
There are no plan assets recognised in the statements of financial position because the requirements under SFAS No. 24 regarding “Employee Benefits” are not
fulfilled.
The projected benefit obligations and fair value of plan assets as at 31 December 2012, based on independent actuarial report, are as follow:
DPBMS DPBMD
DPBMT DPBME
Projected benefit obligations
1,193,395 1,485,326
610,097 436,301
Fair value of plan assets 1,688,723
1,879,761 833,891
610,795 Funded Status
495,328 394,435
223,794 174,494
Unrecognised past service cost
- -
- -
Unrecognised actuarial gains
369,619 221,405
190,852 63,214
Surplus based on SFAS No. 24
125,709 173,030
32,942 111,280
Asset ceiling -
- -
-
Pension Plan Program Assets recognised in
statements of financial position
- -
- -
There are no unrecognised accumulated actuarial loss-net nor unrecognised past service cost and there are no present value of available future refunds or reductions of future contributions.
There are no plan assets recognised in the statements of financial position because the requirements under SFAS No. 24 regarding “Employee Benefits” are not
fulfilled.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 5137 50. EMPLOYEE BENEFITS continued
Labor Law No. 132003
Bank Mandiri has implemented an accounting policy for employment benefits SFAS 24 to recognise provision for employee service entitlements. As at 31 December 2013 and 2012 the Group
recognised a provision for employee services entitlements in accordance with Labor Law No. 132003 amounting to Rp1,965,656 including compensation benefits for employees who have resigned which
compensation have not yet been paid and excluded from actuarial calculation amounted to Rp8,240 and Rp Rp1,635,427 including compensation benefits for employees who have resigned which
compensation have not yet been paid and excluded from actuarial calculation amounted to Rp8,240 based on the estimated post employment benefit in the independent actuarial reports Note 34.
Provision for employee service entitlements as at 31 December 2013 and 2012 are estimated using the employees service entitlements calculation for the years ended 31 December 2013 and 2012 as
shown in the independent actuarial reports of PT Dayamandiri Dharmakonsilindo dated 13 January 2014 for the year ended 31 December 2013 and the independent actuarial reports of PT Dayamandiri
Dharmakonsilindo dated 21 January 2013 for the year ended 31 December 2012. The assumptions used by the actuary for the year ended 31 December 2013 and 2012 are as follows:
a. Discount rate is 8.65 per annum 2012: 5.45 per annum. b. Expected rate of annual salary increase is 9.50 2012: 8.50 per annum.
c. Mortality rate table used is Indonesia Mortality Table 2011 or TMI III. d. Turnover rate is 5
for employees’ age of 25 and decreasing linearly by 0.167 each year up to 0 at age 55.
e. Actuarial method is projected unit credit method. f. Normal retirement age is 56 years.
g. Disability rate is 10 of TMI III. Reconciliations between the provision for post employment benefits presented in the statements of
financial position and statements of income, based on independent actuarial report, are as follows Bank Mandiri only:
2013 2012
Present value of obligations 1,597,813
1,757,767 Unrecognised past service cost
21,952 38,537
Unrecognised actuarial gainslosses 140,547
348,134
Provision for post employment benefits presented in statements of financial position
1,716,408 1,448,170
Current service cost 209,180
144,609 Interest cost
96,467 90,499
Amortisation of unrecognised past service cost 5,142
1,138 Amortisation of unrecognised actuarial gainslosses
16,494 15,285
Recognition of past service cost - vested 119
-
Cost of Pension benefits 327,402
249,255
Reconciliations of provision for post employment benefits are as follows:
2013 2012
Bank Mandiri Beginning balance of provision for post employment benefits
1,448,170 1,273,102
Expenses during the year 327,402
249,255 Payments of benefits
59,164 74,187
Provision for post employment benefits Bank Mandiri 1,716,408
1,448,170 Subsidiaries
Provision for post employment benefits
241,008 179,017
Total provision for post employment benefits 1,957,416
1,627,187
As at 31 December 2013 and 2012, the amount does not include unpaid severance for resigned employees amounting to Rp8,240 and Rp8,240 respectively, which was excluded from actuarial computation.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 5138 50. EMPLOYEE BENEFITS continued
Labor Law No. 132003 continued The present value of funded benefit obligations, fair value of plan assets and the surplus on the
program for the last five years, which are Bank Mandiri only:
2013 2012
2011 2010
2009
Present value of defined benefit obligations 1,597,813
1,757,767 1,547,952
1,262,717 947,923
Fair value of plan assets -
- -
- -
Deficit program 1,597,813
1,757,767 1,547,952
1,262,717 947,923
Experience adjustments on liabilities program 24,497
93,991 127,820
58,912 94,130
Experience adjustments on plan assets -
- -
- -