TRADE ACCOUNTS RECEIVABLE continued

PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2004 AND 2005, AND FOR YEARS ENDED DECEMBER 31, 2004 AND 2005 Figures in tables are presented in millions of Rupiah, unless otherwise stated - 42

8. INVENTORIES

2004 2005 Components 53,611 50,520 Allowance for obsolescence 20,188 8,605 Net 33,423 41,915 Modules 88,259 103,520 Allowance for obsolescence 34,063 39,553 Net 54,196 63,967 SIM cards, RUIM cards and prepaid voucher blanks 115,948 114,634 Allowance for obsolescence 482 189 Net 115,466 114,445 Total 203,085 220,327 Movements in the allowance for obsolescence are as follows: 2004 2005 Beginning balance 40,489 54,733 Additions 14,800 10,968 Inventory write-off 556 17,354 Ending balance 54,733 48,347 Management believes that the allowance is adequate to cover probable losses from decline in inventory value due to obsolescence. At December 31, 2005, inventory held by a certain subsidiary was insured against fire, theft and other specified risks for US0.6 million. Management believes that the insurance amount is adequate to cover such risks. PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2004 AND 2005, AND FOR YEARS ENDED DECEMBER 31, 2004 AND 2005 Figures in tables are presented in millions of Rupiah, unless otherwise stated - 43

9. PREPAID EXPENSES

2004 2005 Rental 268,287 112,078 Salary 218,329 289,632 Frequency license - 275,359 Insurance 98,485 66,449 Telephone directory issuance cost 27,246 26,527 Other 15,722 7,824 Total 628,069 777,869

10. OTHER CURRENT ASSETS

2004 2005 Restricted time deposit - Bank Mandiri 44,608 159,537 As of December 31, 2004, the balance consists of the Company’s time deposits of US4.6 million Rp42,688 million pledged as collateral for credit facility obtained by Napsindo Note 20c and Rp1,920 million pledged as collateral for bank guarantees. As of December 31, 2005, the balance consists of the Company’s time deposits of US13.6 million Rp133,926 million and Rp25,611 million pledged as collateral for bank guarantees.