PT SUMMARECON AGUNG Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AS OF JUNE 30, 2013 AND DECEMBER 31, 2012, 2011 AND 2010 AND FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2013 AND 2012 UNAUDITED
AND YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010 Expressed in thousands of rupiah, unless otherwise stated
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39. SIGNIFICANT AGREEMENTS AND COMMITMENTS continued
v. On July 30, 2009, SCK entered into a joint operation, known as KSO Summarecon Lakeview KSO-SL, with TGS and LK. Under the terms of the agreement, the parties agreed to collaborate
to develop an area known as East Business Unit Land belonging to TGS. KSO-SL has been appointed as the sole party to develop, sell and manage the East Business Unit Land for a period
of 10 years until April 29, 2019. The parties agreed that the net profit of the joint operation shall be distributed to the parties in the following manner: 10 to TGS, 45 to LK and 45 to SCK.
However, loss from the KSO operations, if any, shall be borne by SCK and LK in their respective proportions. Subsequently, on March 17, 2010, the parties agreed to change the percentages of
profit sharing to become: 5 to TGS, 40 to LK and 55 to SCK.
w. The Company and SCK entered into agreements with each of BCA, OCBC, Permata, BII, Danamon, Mandiri, CIMB, Panin, UOB and BNI whereby these banks agreed to provide housing
and apartment loans to the customers of the Company and KSO Summarecon Serpong. The Company and SCK are required to provide collateral in the form of corporate guarantees and
time deposits to temporarily secure the customers’ loans until such time the Company and KSO Summarecon Serpong submit to the respective banks the related certificates of ownership of the
land and buildings purchased by the customers Note 14.
SCK entered into the above agreements on behalf of KSO Summarecon Serpong a joint operation Note 39x.
x. Based on notarial deed No. 39 dated July 21, 2004 of Dewi Himijati Tandika, S.H., SCK entered into a joint operation known as KSO Summarecon Serpong under an agreement with PT
Jakartabaru Cosmopolitan JBC. Under the agreement, both parties agreed to collaborate in developing 400 hectares of land belonging to JBC in Perumahan Gading Serpong Permai,
Tangerang. KSO Summarecon Serpong has been appointed as the only party which will plan, release, expand and operate the land, while SCK has been appointed to handle the management
of the joint operation and identify financing sources for its operations. Income or loss from operations will be distributed at 70 to SCK and 30 to JBC. This agreement is valid for a period
of 10 years until July 20, 2014.
The obligations of JBC in relation to this joint operation include the following, among others: • Provide land to be managed and developed by the parties in KSO Summarecon Serpong
• Take responsibility for solving disputes arising from the land development, if any • Provide the labor requirements of KSO Summarecon Serpong
• Permit SCK to utilize the location license owned by JBC and acquire land ownership over the
undeveloped land • Allow SCK to utilize infrastructure located on the land
• Assist SCK in obtaining the rights over the remaining land by signing the release of land ownership agreements with the individual land owners.
The obligations of SCK in relation to this joint operation include the following, among others: • Provide financing for land development
• Provide the labor requirements of KSO Summarecon Serpong • Acquire land ownership covered by the project.
PT SUMMARECON AGUNG Tbk AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AS OF JUNE 30, 2013 AND DECEMBER 31, 2012, 2011 AND 2010 AND FOR THE SIX-MONTH PERIODS ENDED JUNE 30, 2013 AND 2012 UNAUDITED
AND YEARS ENDED DECEMBER 31, 2012, 2011 AND 2010 Expressed in thousands of rupiah, unless otherwise stated
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39. SIGNIFICANT AGREEMENTS AND COMMITMENTS continued
The details of assets, liabilities, revenues and expenses of KSO Summarecon Serpong which were proportionally consolidated to SCK’s financial statements representing 70 sharing ratio are as
follows:
Total Before Elimination As of June 30, 2013 As of December 31 and for the Years then Ended
and for the Six-Month Period then Ended
2012 2011
2010
Assets 788,841,605
854,989,047 647,254,484
657,670,569 Liabilities
788,841,605 854,989,047
647,254,484 657,670,569
Revenues 163,718,844
311,590,369 705,244,872
439,126,779 Expenses
16,145,764 28,522,034
41,939,261 48,798,983
40. DERIVATIVE INSTRUMENTS
The Company is exposed to market risks, primarily changes in currency exchange rates and interest rates, and uses derivative instruments to hedge the risks in such exposures in connection with its risk
management activities. The Company does not hold or issue derivative instruments for trading purposes.
The Company entered into a Cross Currency Interest Rate Swap CCIRS transaction with PT Bank ANZ Indonesia to hedge the Company’s US5 million debt to Resona Note 15. Under the CCIRS, the
Company purchased U.S. dollars with a principal amount of US5 million from PT Bank ANZ Indonesia on August 31, 2006 for a fixed exchange rate of Rp9,085 to US1 with a maturity date on June 30,
2011. The Company agreed to pay the rupiah principal amortization amount at the fixed exchange rate according to the scheduled dates, and simultaneously receive the fixed U.S. dollar principal
amortization amount. PT Bank ANZ Indonesia agreed to pay the Company monthly interest in U.S.dollars computed at the interest rate of 1 month COLF + 2.30 per annum in 2011 and 2010, in
exchange for the Company paying monthly interest to PT Bank ANZ Indonesia in rupiah computed at the rate of 15.35 per annum on the outstanding principal amount. The interest payment period and
U.S. dollar interest receipts matched the interest payment period and U.S. dollar interest payment of the Resona loan. The rupiah principal paid by the Company amounted to Rp5,344,124 during 2011
and Rp10,688,248 during 2010 and simultaneously received the U.S dollar principal amounting to US 588,236 during 2011 and US1,176,472 during 2010. The Company recognized the net liability
on the CCIRS contract at market value of Rp201,204, which is presented as “Derivative Liability” in the consolidated statement of financial position as of December 31, 2010. The derivative liability was fully
paid in 2011.
The CCIRS instrument was not designated as a hedge for accounting purposes and accordingly, the change in the fair value of the CCIRS was recorded as a charge to “Gain Loss on Derivative
Instrument”, which is presented in the consolidated statements of comprehensive income.
In 2010, the Company was required to provide collateral in the form of time deposits for the CCIRS transaction Note 14.
