PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2013 AND 2012
Expressed in millions of Rupiah, unless otherwise stated
Appendix 539 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
z. Insurance Contract continued
Liability for future policy benefit continued Funds received from customers for non-sharia unit-linked products are reported as gross premiums
in the consolidated statements of comprehensive income. Liabilities to unit-linked policyholders are recognised in the consolidated statement of financial position computed based on unearned
premium reserves using daily method from the cost of insurance to cover mortality risk plus reserves for the accumulated invested fund of unit-linked policyholders. Prior to 1 January 2013, the liabilities
to unit-linked policyholders are recognised in the statements of financial position computed based on unearned premium reserves using aggregate basis at a minimum 40 of the cost of insurance to
cover mortality risk plus reserves for the accumulated invested fund of unit-lined policyholders. Any interest, gain or loss due to increases or decreases in market value of investments are recorded
as income or expense, with a corresponding recognition of increase in liability to unit-linked policyholders in the consolidated statements of comprehensive income and liability to unit-linked
policyholders in the consolidated statement of financial position. Funds received from customers for unit-linked products is recognised as liabilities to unit-linked
policyholders in the consolidated statement of financial position for the amount received net of the
portion representing the Subsidiary’s fees in managing the unit-linked product revenue.
aa. Marketable Securities Issued
Marketable securities issued by the Bank and its Subsidiaries, include bonds, subordinated notes, medium
term notes and travelers’ cheques, are initially measured at fair value plus directly attributable transaction costs. Subsequently transactions costs are amortised using the effective
interest rate up to the maturity of marketable securities issued. Marketable securities issued are classified as financial liabilities at amortised cost. Refer to Note 2c
for the accounting policy for financial liabilities at amortised cost.
ab. Fund Borrowings
Fund borrowings represent funds received from other banks, Bank Indonesia or other parties with the obligation of repayment in accordance with the requirements of the loan agreement.
Fund borrowings are initially measured at fair value minus directly attributable transaction costs. Fund borrowings are classified as financial liabilities at amortised cost. Refer to Note 2c for the
accounting policy for financial liabilities at amortised cost.
ac. Subordinated Loans
Subordinated loans are initially measured at fair value minus directly attributable transaction costs. Subsequently transactions costs are amortised using the effective interest rate up to the maturity of
subordinated loans. Subordinated loans are classified as financial liabilities at amortised cost. Refer to Note 2c for the
accounting policy for financial liabilities at amortised cost.
