Employee benefits continued SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF JUNE 30, 2013 UNAUDITED AND FOR SIX MONTHS PERIOD ENDED WITH COMPARATIVE FIGURES AS OF DECEMBER 31, 2012 AUDITED AND FOR SIX MONTHS PERIOD ENDED JUNE 30, 2012 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated 32

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

u. Financial instruments continued

i. Financial assets continued c. Held-to-maturity financial assets Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that management has the positive intention and ability to hold to maturity, other than: a those that the Company upon initial recognition designates as at fair value through profit or loss; b those that the Company designates as available for sale; and c those that meet the definition of loans and receivables. No financial assets were classified as held-to-maturity financial assets as of June 30, 2013 and December 31, 2012. d. Available-for-sale financial assets Available-for-sale investments are non-derivative financial assets that are intended to be held for indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, exchange rates or that are not classified as loans and receivables, held-to-maturity investments or financial assets at fair value through profit or loss Available-for-sale financial assets consist of bonds and mutual funds which are recorded as other current financial assets. Available-for-sale securities are stated at fair value. Unrealized holding gains or losses on available-for-sale securities are excluded from income of the current period and are reported as a separate component in the equity section of the consolidated statements of financial position until realized. Realized gains or losses from the sale of available-for- sale securities are recognized in the consolidated statements of comprehensive income, and are determined on a specific identification basis. A decline in the fair value of any available-for-sale securities below cost that is deemed to be other-than-temporary is charged to the consolidated statements of comprehensive income. ii. Financial liabilities The Company and subsidiaries classify their financial liabilities as i financial liabilities at fair value through profit or loss or ii financial liabilities measured at amortized cost. The Company and subsidiaries financial liabilities include trade payables and other payables, accrued expenses, loans and other borrowings which consist of short-term bank loans, obligations under capital lease, two step loans, bonds and notes, and bank loans. a. Financial liabilities at fair value through profit or loss Financial liabilities at fair value through profit or loss are financial liabilities classified as held for trading. A financial liability is classified as held for trading if it is incurred principally for the purpose of selling or repurchasing them in the near term and for which there is evidence of a recent actual pattern of short-term profit taking. No financial liabilities were categorized as held for trading as of June 30, 2013 and December 31, 2012. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF JUNE 30, 2013 UNAUDITED AND FOR SIX MONTHS PERIOD ENDED WITH COMPARATIVE FIGURES AS OF DECEMBER 31, 2012 AUDITED AND FOR SIX MONTHS PERIOD ENDED JUNE 30, 2012 UNAUDITED Figures in tables are presented in billions of Rupiah, unless otherwise stated 33

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued