PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2011 AND 2010
Expressed in millions of Rupiah, unless otherwise stated
Appendix 516 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
b. Changes in accounting policies in current year continued
b.iv. SFAS 25 Revised 2009 – “Accounting Policies, Changes in Accounting Estimates and Errors” continued
Allowance for impairment losses on financial guarantee contracts and commitments continued
Determination of allowance for impairment losses on financial guarantee contracts with credit risk and commitments are classified into five categories with the minimum percentage of
allowance for impairment losses as follows:
Minimum percentage of allowance Classification
for impairment losses Pass
1 Special mention
5 Substandard
15 Doubtful
50 Loss
100 The above percentages are applied to commitments and contingencies unused committed
loan facilities, letter of credits and bank guarantee, less collateral value, except for commitments and contingencies categorised as pass, where the rates are applied directly to
the outstanding balance of commitment and contingencies.
Allowance for impairment losses on non-earning assets Starting from 1 January 2011, the Bank determines allowance for possible losses on foreclosed
assets and abandoned properties at the lower of the carrying amount and fair value less costs to sell.
Prior 1 January 2011, the determination of allowance for impairment losses on foreclosed assets and abandoned properties was calculated by the bank in accordance with Bank
Indonesia regulation as follows:
Period Current
Up to 1 year Substandard
More than 1 year up to 3 years Doubtful
More than 3 years up to 5 years Loss
More than 5 years Starting from 1 January 2011, the Bank determines allowance for impairment losses on inter-
office accounts and suspense accounts at the lower of carrying amount and recoverable amount.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2011 AND 2010
Expressed in millions of Rupiah, unless otherwise stated
Appendix 517 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
b. Changes in accounting policies in current year continued
b.iv. SFAS 25 Revised 2009 – “Accounting Policies, Changes in Accounting Estimates and Errors” continued
Allowance for impairment losses on non-earning assets continued Prior 1 January 2011, the Bank determined allowance for impairment losses on inter-office
accounts and suspense accounts as follows: Period
Current Up to 180 days
Loss More than 180 days
The above changes on the determination of allowance for impairment losses represent changes in accounting policy which should generally be applied retrospectively and requiring
restatements of prior years’ results. However, as the impacts of the change in respect of prior years’ results are not material, no restatements were made and the impacts of the change are
charged to the current year consolidated statement of comprehensive income.
b.v. SFAS 7 Revised 2010 – “Related Party Disclosures” Starting from 1 January 2011, a government related entity-entity that is controlled, jointly
controlled or significantly influenced by the Government of Republic Indonesia is considered as a related party. The comparative information has been represented to conform with the revised
standard refer to Note 51.
Prior to 1 January 2011, all government – related entities were not considered as related parties.
Refer to Note 2f for definition and accounting policy for transaction with related party. b.vi. SFAS 4 Revised 2009 – “Consolidated and Separate Financial Statements”
Starting from 1 January 2011, the Bank implemented SFAS 4 Revised 2009 on the parent company only financial statements, which presents the Bank’s investments in subsidiaries
under the cost method. Previously, the Bank’s investments in subsidiaries was presented under the equity method. The comparative information has been restated refer to page 611.
c. Financial instruments A. Financial assets
