PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2014 and for the Six Months Period Then Ended unaudited
Figures in tables are expressedin billions of rupiah, unless otherwise stated
84
34. RETIREMENT BENEFIT AND OTHER POST RETIREMENT BENEFIT OBLIGATIONS
continued a. Prepaid pension benefit costs continued
The movements of the prepaid pension benefit costs during six months period ended June 30, 2014 and for the year ended December 31, 2013 are as follows:
June 30, December 31,
2014 2013
Prepaid pension benefit costs at beginning of period 927
1,031 Net periodic pension costs less amounts
charged to subsidiaries 15
265 Amounts charged to subsidiaries
under contractual agreement -
21 Employer’s contributions
- 182
Prepaid pension benefit costs at end of period 942
927
As of June 30, 2014 and December 31, 2013, pension plan assets mainly consisted of :
June 30, December 31,
2014 2013
Government bonds 37.81
40.30 Indonesian equity securities
22.84 21.97
Corporate bonds 19.18
21.19 Others
20.17 16.54
Total 100.00
100.00
Pension plan assets also include Series B shares issued by the Company with fair values totaling Rp334 billion and Rp336 billion, representing 1.86 and 2.00 of total plan assets as of
June 30, 2014 and December 31, 2013, respectively, and bonds issued by the Company with fair values totaling Rp151 billion representing 0.84 and 0.90 of total plan assets as of June 30,
2014 and December 31, 2013, respectively.
The actuarial valuation for the defined benefit pension plan and the other post-retirement benefits Notes 34b and 34c was performed based on the measurement date as of December 31, 2013
and 2012, with reports dated February 28, 2014 and February 28, 2013, respectively, by PT Towers Watson Purbajaga “TWP”, an independent actuary in association with Towers
Watson “TW” formerly Watson Wyatt Worldwide. The principal actuarial assumptions used by the independent actuary as of December 31, 2013 and 2012 are as follows:
December 31, December 31, 2013
2012
Discount rate 9.00
6.25 Expected long-term return on pension plan assets
9.75 8.25
Rate of compensation increases 8.00
8.00 The components of net periodic pension costs are as follows:
34. RETIREMENT BENEFIT AND OTHER POST RETIREMENT BENEFIT OBLIGATIONS
PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2014 and for the Six Months Period Then Ended unaudited
Figures in tables are expressedin billions of rupiah, unless otherwise stated
85
continued a. Prepaid pension benefit costs continued
June 30, December 31,
2014 2013
Service costs 95
450 Interest costs
654 1,183
Expected return on pension plan assets 803
1,485 Amortization of prior service costs
39 139
Net periodic pension costs 15
287 Amount charged to subsidiaries
under contractual agreements -
21
Net periodic pension costs less amounts charged to subsidiaries Note 27
15 266
b. Pension benefit costs provisions
i The Company The Company sponsors unfunded defined benefit pension plans and a defined contribution
pension plan for its employees. The defined contribution pension plan is provided to employees hired with permanent status
on or after July 1, 2002. The plan is managed by Financial Institutions Pension Fund “Dana Pensiun Lembaga Keuangan” or “DPLK”. The Company’s contribution to DPLK is determined
based on a certain percentage of the participants’ salaries and amounted to Rp3 billion and Rp6 billion for six months period ended June 30, 2014 and for the year ended
December 31, 2013, respectively.
Since 2007, the Company has provided pension benefit based on uniformulation for both participants prior to and from April 20, 1992 effective for employees retiring beginning
February 1, 2009. The change in benefit had increased the Company’s obligations by Rp699 billion, which is amortized over 9.9 years until 2016. In 2010, the Company replaced
the uniformulation with Manfaat Pensiun Sekaligus “MPS”. MPS is given to those employees reaching retirement age, upon death or upon being disabled starting from February 1, 2009.
The change in benefit had increased the Company’s obligations by Rp435 billion, which is amortized over 8.63 years until 2018.
The Company also provides benefits to employees during a pre-retirement period in which they are inactive for 6 months prior to their normal retirement age of 56 years, known as pre-
retirement benefits “Masa Persiapan Pensiun” or “MPP”. During the pre-retirement period, the employees still receive benefits provided to active employees, which include, but are not
limited to, regular salary, health care, annual leave, bonus and other benefits. Since 2012, the Company has issued a new requirement for MPP effective for employees retiring beginning
April 1, 2012, whereby the employee is required to file a request for MPP and if the employee does not file the request, he or she is required to work until the retirement date.
34. RETIREMENT BENEFIT AND OTHER POST RETIREMENT BENEFIT OBLIGATIONS
