CASH AND CASH EQUIVALENTS continued 2014

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 48

7. INVENTORIES 2014

2013 Components 279 272 SIM cards, RUIM cards, set top boxes, and blank prepaid vouchers 105 102 Others 133 157 Total 517 531 Provision for obsolescence Components 15 21 SIM cards, RUIM cards, set top boxes, and blank prepaid vouchers 28 1 Others - Total 43 22 Net 474 509 Movements in the provision for obsolescence are as follows: 2014 2013 Beginning balance 22 148 Provision reversal recognized during the year 39 29 Inventory write off 18 - Reclassification - 96 Divestment Note 3 - 1 Ending balance 43 22 The inventories recognized as expense and included in operations, maintenance, and telecommunication service expenses Note 28 as of December 31, 2014 and 2013 amounted to Rp1,031 billion and Rp752 billion, respectively. 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 Rp57 billion have been pledged as collateral under lending agreements Notes 17 and 21. As of December 31, 2014 and 2013, modules and components held by the Group has been insured against fire, theft, and other specific risks with book value amounting to Rp237 billion and Rp280 billion, respectively. Modules are recorded as part of property and equipment. Total sum insured as of December 31, 2014 and 2013 amounted to Rp266 billion and Rp261 billion, respectively. Management believes that the insurance coverage is adequate to cover potential losses of certain inventories which happens to the Group. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of December 31, 2014 and for the Year Then Ended Figures in tables are expressedin billions of Rupiah, unless otherwise stated 49

8. ADVANCES AND PREPAID EXPENSES 2014

2013 Frequency license Notes 41c.i and 41c.ii 2,699 2,330 Prepaid rental 983 744 Advances 410 297 Salaries 218 209 Deferred expense 51 124 Insurance 34 84 Others each below Rp75 billion 338 149 Total 4,733 3,937 Refer to Note 37 for details of related party transactions.

9. ASSET HELD FOR SALE

This account represents the carrying amount of Telkomsel’s equipment to be exchanged with equipment of Nokia Siemens Network Oy “NSN Oy” and PT Huawei Tech Investment “PT Huawei”. The amount will be used as part of the settlement for the acquisition of equipment from these companies. In 2014 and 2013, Telkomsel’s equipment with net carrying amount of Rp41 billion and Rp105 billion, respectively, are reclassified to asset held for sale Note 11c.vi. Asset held for sale is presented under personal segment Note 38.

10. LONG-TERM INVESTMENTS

2014 Share of net loss Percentage profit of of Beginning Addition associated Translation Ending ownership balance Deduction company adjustment balance Long-term investments in associated companies: Tiphone a 24.92 - 1,395 3 - 1,392 Indonusa b 20.00 189 32 - - 221 Teltranet c 51.00 - 52 - 52 PT Melon Indonesia “Melon” d 51.00 39 - 4 - 43 PT Integrasi Logistik Cipta Solusi “ILCS” e 49.00 37 - 1 - 38 Telin Malaysia f 49.00 18 8 19 1 6 CSM g 25.00 - - - - - PSN h 14.60 - - - - - Sub-total 283 1,487 17 1 1,752 Other long-term investments 21 6 - - 15 Total long-term investments 304 1,481 17 1 1,767