PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED continued SEPTEMBER 30, 2007 AND 2008,
AND NINE MONTHS PERIOD ENDED SEPTEMBER 30, 2007 AND 2008 Figures in tables are presented in millions of Rupiah, unless otherwise stated
28
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued s. Income tax continued
Amendment to taxation obligations are recorded when an assessment is received or if appealed against, when the results of the appeal are determined.
t. Derivative instruments
Derivative transactions are accounted for in accordance with PSAK 55, “Accounting for Derivative Instruments and Hedging Activities” which requires that all derivative instruments be recognized
in the financial statements at fair value. To qualify for hedge accounting, PSAK 55 requires certain criteria to be met, including formal documentations at the inception of the hedge.
Changes in the fair values of derivative instruments that do not qualify for hedge accounting are recognized in the consolidated statements of income. If a derivative instrument is designated and
qualifies for hedge accounting the assets or liabilities shall be adjusted. The changes in fair values of derivative instruments are recognized in the consolidated statements of income or
consolidated statement of changes in stockholder’s equity depending on the type and effectiveness of hedge transaction.
u. Treasury Stock
Reacquired Company’s stock is accounted for at its reacquisition cost and classified as “Treasury Stock” and presented as deduction in stockholders’ equity. The cost of treasury stock sold is
accounted for using the weighted average method. The difference resulting from the cost and the proceeds from the sale of treasury stock is credited to “Paid-in Capital”.
v. Dividends
Dividend distribution to the Company’s stockholders is recognized as liability in the Company’s consolidated financial statements in the period in which the dividends are approved by the
Company’s stockholders. For interim dividends, the Company recognized it as liability based on the Board of Director’s decision with the approval from the Board of Commissioners.
w. Earnings per share and earnings per ADS
Basic earnings per share are computed by dividing net income by the weighted average number of shares outstanding during the year. Net income per ADS is computed by multiplying basic
earnings per share by 40, the number of shares represented by each ADS.
x. Segment information
The Company and its subsidiaries segment information is presented based upon identified business segments. A business segment is a distinguishable unit that provides different products
and services and is managed separately. Business segment information is consistent with operating information routinely reported to the Companys chief operating decision maker.
y. Use of estimates
The preparation of the consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures
of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant items subject
to such estimates and assumptions include the carrying amount of property, plant and equipment and intangible assets, the valuation allowance for receivables and obligations related to employee
benefits. Actual results could differ from those estimates.
PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED continued SEPTEMBER 30, 2007 AND 2008,
AND NINE MONTHS PERIOD ENDED SEPTEMBER 30, 2007 AND 2008 Figures in tables are presented in millions of Rupiah, unless otherwise stated
29
3. TRANSLATION OF RUPIAH INTO UNITED STATES DOLLARS
The consolidated financial statements are stated in Indonesian Rupiah “Rupiah”. The translations of Indonesian Rupiah amounts into U.S. Dollars are included solely for the convenience of the readers
and have been made using the average of the market buy and sell rates of Rp.9,430 to US1 as published by Reuters on September 30, 2008. The convenience translations should not be construed
as representations that the Indonesian Rupiah amounts have been, could have been, or could in the future be, converted into United States Dollars at this or any other rate of exchange.
4. ACQUISITIONS OF SIGMA
On February 21, 2008, Metra and Sigma’s stockholders, PT Sigma Citra Harmoni and Trozenin Management Plc signed an Amendment to the Sales and Purchase of Shares Agreement which
authorized Metra to acquire 80 of the outstanding common stock of Sigma for US35.2 million or equivalent to Rp.331,052 million.
The acquisition of Sigma has been accounted for using the purchase method of accounting, which purchase price were allocated to fair value of the acquired assets and assumed liabilities. The
allocation of the acquisition cost was as follows:
Rp.
Purchase consideration 331,052
Fair value of net assets acquired: - Current assets
120,369 - Fixed assets
65,511 - Goodwill
37,924 - Intangible assets
256,354 - Other non-current assets
30,935 - Current liabilities
64,172 - Long-term liabilities
30,308 - Deferred tax liabilities
85,561
Fair value of net assets as at February 22, 2008 331,052
The fair value of acquired assets and recognized liabilities was determined by an independent appraisal. The intangible assets represent long-term contract, software and trademark Note 14.
The Company’s consolidated results of operations has included the operating results of Sigma since March 1, 2008 being the nearest convenient consolidated balance sheet date.
