PT SUMMARECON AGUNG Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of June 30, 2017 and for the Six-Month Periods Then Ended Expressed in thousands of Indonesian Rupiah, unless otherwise stated
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONTINUED r. Foreign currency transactions and balances
The company’s consolidated financial statements are presented in Rupiah, which is also the Parent Company’s functional currency. Each subsidiary determine its own functional currency and items included in the financial
statements of each entity are measured using that functional currency. Transaction in foreign currencies are initialy recorded by the Group at their respective functional currency rates
prevailing at the date of transaction. Monetary assets and liabilities denominated in foreign currencies are adjusted to reflect the average of the selling and buying rates of exchange prevailing at the last banking transaction date of the
period, as published by Bank Indonesia and any resulting gains or losses are credited or changed to operations of the current period.
As of June 30, 2017 and December 31, 2016, the rates of exchange used were as follows:
Foreign Currencies June 30, 2017
Full Amount December 31, 2016
Full Amount
1 European euro Euro 14,875
14,162 1 United States dollar US
13,319 13,436
1 Singapura dollar Sin 9,591
9,299 Transactions in other foreign currencies are considered not significant.
s. Provisions
A provision is recognized when the Group has a present obligation legal or constructive where, as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation
and a reliable estimate can be made of the amount of the obligation. All of the provisions are reviewed at each reporting date and adjusted to reflect the current best estimate. If it is no
longer probable that an outflow of resources embodying economic benefits will be required to settle the obligations, the provisions are reversed.
t. Income tax
The Group has adopted PSAK 46 Revised 2014, “Income Tax”. Final Tax
Tax regulation in Indonesia determined that certain taxable income is subject to final tax. Final tax applied to the gross value of transactions is applied even when the parties carrying the transaction recognizing losses.
By applying the revised PSAK, the Group has decided to present all of the final tax arising from sales of landplots, houses and shops as separate line item.
The difference between the carrying amount of a revalued asset and its tax base is a temporary difference and gives rise to a deferred tax liability or asset, except for certain asset such as land, which realization is taxed with final tax on
gross value of transaction. According to Law No. 12 year 1994, the value of the transfer is the highest value among the values under the Deed of
Assignment and the Tax Object Sales Value of related land andor buildings. Based on Government Regulation PP No. 5 dated March 23, 2002, income from shopping center rental is subjected
to a final tax of 10, except for income on rental contracts signed prior to such regulation which is subject to 6. On November 4, 2008, the President of the Republic of Indonesia and the Minister of Law and Human Rights signed
Government Regulation No. 712008 PP No. 712008 on “the third changes on PP No. 481994 regarding payment of income tax on income from transfer rights on land andor building”. This regulation provides that, effective January
1, 2009, the income of a taxpayer from transactions of transferring rights on land andor building, is subjected to final tax of 5 from the sales or transfer, which has been replaced by Government Regulation PP No. 342016 dated
August 8, 2016, effective since September 8, 2016, income from the transfer of land or buildings are subjected to final tax amounting to 2.5 of the value of the sale or transfer.
PT SUMMARECON AGUNG Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of June 30, 2017 and for the Six-Month Periods Then Ended Expressed in thousands of Indonesian Rupiah, unless otherwise stated
25
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONTINUED t. Income tax continued
