These consolidated financial statements are originally issued in Bahasa.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2015 and for the year then ended Expressed in millions of Rupiah, unless otherwise stated
50
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
l. Other receivables - trade transactions
Other receivables - trade transactions represent receivables resulting from contracts for trade- related facilities given to customers, which will be reimbursed on maturity.
Other receivables - trade transactions are classified as financial assets in loans and receivables. Refer to Note 2c for the accounting policy of loans and receivables.
m. Securities purchasedsold under resalerepurchase agreements
Securities purchased under resale agreements are presented as assets in the consolidated statement of financial position at the agreed resale price less unamortised interest income and
allowance for impairment losses. The difference between the purchase price and the agreed selling price is treated as deferred unamortised interest income and amortised as income over
the period, commencing from the acquisition date to the resale date using the effective interest rate method.
Securities purchased under resale agreements are classified as financial assets in loans and receivables. Refer to Note 2c for the accounting policy of loans and receivables.
Securities sold under repurchase agreements are presented as liabilities in the consolidated statement of financial position at the agreed repurchase price net of the unamortised prepaid
interest. The difference between the selling price and the agreed repurchase price is treated as prepaid interest and recognised as interest expense over the period, commencing from the selling
date to the repurchase date using effective interest rate method.
Securities sold under repurchase agreements are classified as financial liabilities at amortised cost. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost.
n. Derivative receivables and derivative payables
All derivative instruments including foreign currency transactions for funding and trading purposes are recognised in the consolidated statement of financial position at their fair values.
Fair value is determined based on market value using Reuters rate at reporting date or discounted cash flow method.
Derivative receivables are presented at the amount of unrealised gain from derivative contracts, less allowance for impairment losses. Derivative payables are presented at the amount of
unrealised loss from derivative contracts.
Gains or losses from derivative contracts are presented in the consolidated financial statements based on its purpose designated upon acquisition, as 1 fair value hedge, 2 cash flow hedge, 3
net investment in a foreign operation hedge, and 4 trading instruments as follows:
1. Gain or loss on a derivative contract designated and qualifies as a fair value hedging
instrument and the gain or loss arising from the changes in fair value of hedged assets and liabilities is recognised as gain or loss that can be set off one another during the same
accounting periodyear. Any difference representing hedge ineffectiveness is directly recognised as gain or loss in current year.
2. The effective portion arising from gain or loss of derivative contracts, designated as a cash
flow hedge instruments is reported as other comprehensive income. The hedge ineffective portion is recognised as a gain or loss in the current year.
These consolidated financial statements are originally issued in Bahasa.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2015 and for the year then ended Expressed in millions of Rupiah, unless otherwise stated
51
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
n. Derivative receivables and derivative payables continued
3. Gain or loss arising from derivative contract that is designated as a net investment hedge in a
foreign operation is reported as other comprehensive income, as long as the transactions are effectively recognised as hedge transactions.
4. Gain or loss arising from derivative contract that is not designated as a hedging instrument or
derivative contract that does not qualify as a hedging instrument is recognised as gain or loss in current year.
Derivative receivables are classified as financial assets at fair value through profit or loss, meanwhile derivative payables are classified as financial liabilities at fair value through profit or
loss. Refer to Note 2c for the accounting policy of financial assets and liabilities at fair value through profit or loss.
o. Loans and sharia receivablesfinancing
Loans represent agreement to provide cash or cash equivalent based on agreements with borrowers, where borrowers are required to repay their debts with interest after a specified period,
and matured trade finance facilities which have not been settled within 15 days.
Syndicated loans, direct financing and joint financing, and channeling loans are stated at their outstanding balances in proportion to the risks borne by the Bank and its Subsidiaries.
Included in loans are financing by Bank Syariah Mandiri “BSM”, a Subsidiary, in the form of sharia receivables, sharia financing and funds of Qardh.
Brief explanation for each type of sharia financing is as follows: Mudharabah financing is a co-operation for certain project between first party malik, shahibul mal
or Subsidiary as owner of fund and second party amil, mudharib or debtors as fund manager whereas the profit sharing will be shared in accordance with percentage as stated in the
agreement, meanwhile losses will be borne by the Subsidiary except if the second party does negligence, error or violate the agreement. Mudharabah financing is stated at the outstanding
financing balance less allowance for possible losses.
Musyarakah financing is a co-operation between two or more parties in a certain business wherein each party provides a portion of fund on condition that the profit shall be shared based on the
agreement, whereas losses shall be borne in accordance with the portion of the fund of each party. Permanent musyarakah is musyarakah in which the fund portion of each partner is stated
explicitly in the contract and remains the same until the contract expires. Declining musyarakah musyarakah mutanaqisha is musyarakah in which the fund portion of the Bank will be transferred
in several stages to the other partner, resulting in the declining of fund portion of the Bank and, at the end of contract, the other partner will become the sole owner of the business. Musyarakah
financing is stated at the outstanding financing balance less allowance for possible losses.
Ijarah receivables are the financing on the availability of fund in relation to transferring the right to use and benefit of a good and service based on rental transaction which was not followed by
transfer of the goods ownership to the lessee. Ijarah muntahiyah bittamlik is an agreement on the availability of fund in relation to transferring the use right and benefit of a good or service based on
rental transaction with an option to transfer the ownership of goods to the lessee. Ijarah receivables are recognised at due date at the amount of it lease income not yet received and
presented at its net realisable value, which is the outstanding balance of the receivables.
