INVENTORIES March 2016 FS ENGLISH Q1 2016

40 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the Three Months Period Ended March 31, 2016 and 2015 unaudited Figures in tables are expressed in billions of Rupiah, unless otherwise stated Table of Contents

6. INVENTORIES March

31, 2016

December 31, 2015 Components 351 342 SIM cards, set top boxes, and blank prepaid vouchers 130 131 Others 117 96 Total 598 569 Provision for obsolescence Components 14 14 SIM cards, set top boxes and blank prepaid vouchers 27 27 Others - Total 41 41 Net 557 528 Movements in the provision for obsolescence are as follows: March 31, 2016 December 31, 2015 Beginning balance 41 43 Provision recognized during the year - 2 Inventory write off - 4 Ending balance 41 41 The inventories recognized as expense and included in operations, maintenance, and telecommunication service expenses as of March 31, 2016 and 2015 amounted to Rp478 billion and Rp442 billion, respectively Note 24. 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 amounting to Rp268 billion have been pledged as collateral under lending agreements Notes 15 and 16c. As of March 31, 2016 and December 31, 2015, modules and components held by the Group with book value amounting to Rp218 billion and Rp219 billion, respectively, has been insured against fire, theft, and other specific risks. Modules are recorded as part of property and equipment. Total sum insured as of March 31, 2016 and December 31, 2015 amounted to Rp291 billion, respectively. Management believes that the insurance coverage is adequate to cover potential losses of inventories arising from the insured risks. 41 PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the Three Months Period Ended March 31, 2016 and 2015 unaudited Figures in tables are expressed in billions of Rupiah, unless otherwise stated Table of Contents

7. ADVANCES AND PREPAID EXPENSES March