Changes in Accounting Policies

Catatan atas Laporan Keuangan untuk 31 Desember 2005 dan 2004 PT International Nickel Indonesia Tbk Notes to the Financial Statements December 31, 2005 and 2004 PT International Nickel Indonesia Tbk 14 Pada tahun 2005, Perseroan juga mengubah kebijakan akuntansi untuk program imbalan manfaat pasti sebagai bagian dari penerapan Pernyataan Standar AKuntansi Keuangan PSAK 24 Revisi 2004 “Imbalan Kerja”. Menurut standar yang terbaru, Perseroan diwajibkan untuk mengakui semua imbalan kerja yang berlaku termasuk imbalan jangka pendek, imbalan paska kerja, imbalan jangka panjang lainnya, pesangon and imbalan kompensasi saham. Sebelumnya, Perseroan mengakui kewajiban imbalan kerja berdasarkan mana yang lebih tinggi antara kewajiban pension dan kewajiban menurut Undang – Undang Tenaga Kerja No. 132003 lihat Catatan 3.

3. Penyajian Kembali Laporan Keuangan

Seperti diungkapkan dalam Catatan 2.16, pada tahun 2005 Perseroan telah mengubah kebijakan akuntansi untuk penyusutan Aktiva Tetap, pelepasan Aktiva Tetap dan penerapan PSAK 24 Revisi 2004 “Imbalan Kerja”. Laporan Keuangan komparatif untuk tahun yang berakhir pada tanggal 31 Desember 2004 telah disajikan kembali sebagai berikut: In 2005, the Company also changed its accounting policy for its employee defined benefit plans following a 2004 revision of Statement of Accounting Standard PSAK 24 – Revised 2004 “Employee Benefits”. Under the new standard, the Company is required to recognize all applicable employee benefits including short term benefits, post employment benefits, other long term benefits, termination benefits and equity compensation benefits. Previously, the Company recognized its liability based on the benefit obligation provided under the Company’s existing pension program and the Labor Law No. 132003, whichever was higher refer to Note 3.

3. Restatements of Financial Statements

As disclosed in Note 2.16, during 2005 the Company changed its accounting policies for depreciation of Property, Plant and Equipment and the disposal of Property, Plant and Equipment and adopted PSAK 24 Revised 2004 “Employee Benefits”. The comparative financial statements as at and for the year ended December 31, 2004 have been restated as follows: Sebelum Setelah Penyajian Penyajian Kembali Kembali Penyesuaian Before After Adjustments Restatements Restatements Dalam ribuan Dollar AS US, in thousands Neraca Balance Sheets Aktiva Tetap, bersih 1.035.652 1.152.064 116.412 Property, Plant and Equipment, net Kewajiban Pajak Tangguhan 170.127 200.353 30.226 Deferred Tax Liabilities Kewajiban Imbalan Kerja 905 17.889 16.984 Provision for Employee Benefits Saldo Laba 633.854 703.056 69.202 Retained Earnings Laporan Laba Rugi Statements of Earnings Laba Kotor 399.799 434.906 35.107 Gross profit Beban Pajak Penghasilan 114.151 122.441 8.290 Income Tax Expense Laba Bersih 265.088 284.431 19.343 Net Earnings Termasuk sejumlah 7.475 dollar AS di reklasifikasi sebagai pendapatanbeban lain untuk tujuan penyajian komparatif lihat Catatan 37 Includes an amount of US 7,475 which has been reclasified as other incomeexpense for comparative purposes refer to Note 37

4. Kas dan Setara Kas

31 Desember 2005 2004 December 31 Dalam ribuan Dolar AS US, in thousands Kas 30 31 Cash on Hand Bank: Cash in Bank: Denominasi dalam Rupiah Denominated in Rupiah Bank Mandiri Persero Tbk 167 2.272 Bank Mandiri Persero Tbk Citigroup N.A. 585 317 Citigroup N. A. Bank Rakyat Indonesia Persero Tbk 711 960 Bank Rakyat Indonesia Persero Tbk Lainnya 187 81 Others Denominasi dalam Dolar AS Denominated in US Dollars JP Morgan Chase Bank 988 813 JP Morgan Chase Bank Citigroup N.A. 19.680 19.222 Citigroup N. A. Lainnya 755 1 Others Denominasi dalam Dolar Singapura Denominated in Singapore Dollars Citigroup N.A. 47 168 Citigroup N. A. Denominasi dalam Dolar Kanada Denominated in Canadian Dollars Citigroup N.A. 4 6 Citigroup N. A. 23.124 23.840

4. Cash and Cash equivalents

Catatan atas Laporan Keuangan untuk 31 Desember 2005 dan 2004 PT International Nickel Indonesia Tbk Notes to the Financial Statements December 31, 2005 and 2004 PT International Nickel Indonesia Tbk 15

5. Piutang Usaha

The average of interest rates on the above Time Deposits are as follows: 31 Desember 2005 2004 December 31 Dalam ribuan Dolar AS US, in thousands Deposito Berjangka Time Deposits Denominasi dalam Dolar AS Denominated in US Dollars JP Morgan Chase Bank 159.828 204.881 JP Morgan Chase Bank UFJ Bank 66.165 64.240 UFJ Bank Denominasi dalam Rupiah Denominated in Rupiah Bank Mandiri Persero Tbk 36 63 Bank Mandiri Persero Tbk Jumlah Deposito Berjangka 226.029 269.184 Total Time Deposits Jumlah Kas dan Setara Kas 249.183 293.055 Total Cash and Cash Equivalents Rata-rata suku bunga Deposito Berjangka di atas adalah: Deposito Dolar AS 3,3 1,3 US Dollar Deposits Deposito Rupiah 8,5 5,8 Rupiah Deposits 31 Desember 2005 2004 December 31 Dalam ribuan Dolar AS US, in thousands Pihak yang mempunyai hubungan istimewa 82.944 63.119 Related parties Analisis umur piutang usaha adalah sebagai berikut: 31 Desember 2005 2004 December 31 Dalam ribuan Dolar AS US, in thousands Lancar 82.944 63.119 Current Jumlah 82.944 63.119 Total

5. Trade Receivables

Aging analysis of Trade Receivables is as follows: Jumlah piutang diatas adalah lancar sesuai dengan termin pembayaran seperti disepakati dalam kontrak penjualan. Berdasarkan hasil penelaahan keadaan akun piutang masing- masing pelanggan pada akhir tahun, manajemen Perseroan berkeyakinan bahwa tidak diperlukan adanya penyisihan piutang ragu-ragu untuk menutup kemungkinan kerugian atas tidak tertagihnya piutang usaha. Piutang ini telah dijadikan agunan pinjaman bank seperti dijelaskan dalam Catatan 12. Lihat Catatan 30 untuk rincian saldo dan transaksi pihak yang memiliki hubungan istimewa. All amounts are current within the payment terms as set out in the sales contract. Based on a review of the status of the individual accounts receivable at the end of the year, the Company’s management believes that no allowance for doubtful accounts is necessary to provide for losses from the potential non-collection of these accounts. These receivables have been pledged as collateral for bank loans as described in Note 12. Refer to Note 30 for details of related party balances and transactions.