Contractual Obligation Cash Flows from Financing Activities Net cash flows used in financing activities totaled Rp13,327
A. Purpose of the Commitment As of December 31, 2014, we had material commitments
for capital expenditures under certain contractual arrangements of Rp16,195 billion, principally relating to procurement and installation of the broadband network, transmission equipment and cable system. These include for cooper wire access modernization through Trade InTrade Off method project, Luwuk- Tutuyan Cabel System project, Outside Plant Fiber To The Home OSP FTTH project, Sulawesi Maluku Papua Cable System SMPCS project, expansion and Maintenance Support MS Service for Metro Ethernet Platform ALU project, expansion of DWDN platform ALU project, WIFI CISCO project, IP Radio Equipment for Backhaul Node-B project, Cabel System for Broadband Network Division 2014 project, Telkom-3 Subtitution T3S Satelite System project. Our subsidiary, Telkomsel, has material commitment for capital expenditures related , among others, the combined 2G and 3G CS Core Network Rollout project, 2G BSS and 3G UTRAN Rollout agreement for the provision of 2G GSM BSS and 3G UMTS Radio Access Network project, Next Generation Convergence “NGC” IP RAN Rollout and Technical Support project, Maintenance and procurement of equipment and related service agreement for NGC Core Transport Rollout and Technical Support project, Online Charging System “OCS” and Service Control Points “SCP” System Solution Development project, OCS dan CSP technical support project, Customer Relationship Management dan Contact Center Solutions project, CS Core System Rollout dan CS Core System Technical Support project, OSDSS Solution project, GGSN service complex rollout project, Gateway GPRS Support Node Service Complex technical support project. 135 2014 Annual Report PT Telkom Indonesia Tbk Persero In addition, PT Graha Sarana Duta “TelkomProperty” dan Telin also have material commitment for capital expenditure, facade Unitized System Telkom Landmark Tower project, Development of Infomedia’s building project , Operational Supporting System, Base Sub Station project, Value Added System, System Rollout, Radio Access Network dan Core System Rollout project. For more detailed discussion regarding our material commitments for capital expenditures, see Note 41 to our Consolidated Financial Statements.B. Source of Funds We have historically funded our capital expenditures
primarily with cash generated from operations. In 2014, we expect that our capital expenditure to revenue ratio will be approximately in the range of 25-30. We expect that of the total increase in amount of capital expenditure in 2014 over 2013, the most significant proportions will be allocated broadband services with a portion of the increase allocated to our subsidiaries. We expect to fund the above commitments with our internal and external source of funds. We expect to fund the above commitments with our internal and external sources of funds. See explanation on “Capital Expenditures”.C. Denomination of Currency As of December 31, 2014, details of material commitment
for capital investment by currency are as follows: Currencies Amounts in Foreign Currencies in millions Equivalent in Rupiah in billions Rupiah 9.837 US Dollar 512 6.349 Euro 0.35 5 SGD 0.40 4 16,195D. Planned Actions to Mitigate Foreign Exchange Risks
We are exposed to foreign exchange risk on sales, purchases and borrowings transactions that are denominated in foreign currencies, primarily in US Dollars and Japanese Yen. Nevertheless, our exposure to foreign exchange rates risk is not material. Management provides written policy for foreign currency risk management mainly through time deposits placements and hedging to cover foreign currency risk exposures for the time range of 3 up to 12 months. Increasing risks of foreign currency exchange rates on our obligations are expected to be offset by time deposits and receivables in foreign currencies that are equal to at least 25 of the outstanding current liabilities. For detail discussion on material commitments for capital investment, exchange rate and interest rate see Notes 41 and 44 to our Consolidated Financial Statements. MATERIAL INFORMATIONS OF INVESTMENT, ExPANSION, DIVESTMENT, ACQUISITION AND DEBTCAPITAL RESTRUCTURE In 2014, we did some activities related to investments, divestments, acquisitions and debtcapital restructuring. The activities are as follows:A. Investment -
On August 29, 2014, Telkom Metra entered into a shareholders agreement with Telstra Holding Singapore Pte. Ltd. to establish a joint venture known as PT TeltraNet Application Solutions Teltranet. Telkom Metra acquired ownership of 51 or US4,29 million of the total issued share capital US8,43 million, but Telkom Metra was not have control in determining the financial and operating policies of Teltranet. Teltranet engaged in services and communication systems. 136 2014 Annual Report PT Telkom Indonesia Tbk Persero FINANCIAL AND PERF ORMANCE HIGHLIGHT MANA GEMENT REPOR T PREF A GENERAL INF ORMA TION OF TELK OM INDONE SIA MANA GEMENT’S DISCUSSION AND ANAL Y SIS CORPORA TE GO VERNANCE SOCIAL AND ENVIRONMENT AL RE SPONSIBILITY APPENDICE SParts
» Telkomsel Double Digit Revenue Growth Indonesia Digital Network IDN 2015 International Expansion
» Parenting Strategy : Strategic guidance
» Shareholders with Ownership More Than 5 MainControlling Shareholder
» Ownership of Stocks by Directors and Commissioners
» Shareholders with Less than 5 Ownership
» Proportion of Common Stock Held in Indonesia and Abroad List of the 20 Biggest Public Shareholders
» Employee Stock Ownership Program
» Chronology of Bonds Purchases of Equity Securities by The Issuer and Affiliated Purchasers
» Sekretariat of President AR TELKOM 2014 ENG
» Director Human Capital AR TELKOM 2014 ENG
» Director of Consumer Service
» Directorate of Wholesale International Business Service
» Director of Innovations AR TELKOM 2014 ENG
» Direktur Enterprise Business AR TELKOM 2014 ENG
» Director of Finance AR TELKOM 2014 ENG
» Department of Corporate AR TELKOM 2014 ENG
» Internal Auditor AR TELKOM 2014 ENG
» Department of Project AR TELKOM 2014 ENG
» Finance Billing Collection Center FBCC
» Human Capital Center AR TELKOM 2014 ENG
» Telkom Corporate University Center
» Supply Center AR TELKOM 2014 ENG
» Innovation Design Center IDeC
» Community Development Center CDC
» Human Resource Assessment Service Assesment Center
» ITSS Division AR TELKOM 2014 ENG
» Enterprise Service Division AR TELKOM 2014 ENG
» Business Service Division AR TELKOM 2014 ENG
» Wholesale Service Division AR TELKOM 2014 ENG
» Broadband Division AR TELKOM 2014 ENG
» Wireless Broadband Division AR TELKOM 2014 ENG
» Network of Broadband Division
» Witel of Central Java of Eastern North
» Witel of Southern Central Java
» Witel Yogyakarta AR TELKOM 2014 ENG
» Witel of Central Java of Eastern South
» Regional Division V East Java
» Witel of East Java of Central East
» Witel of East Java of Southern East
» Witel of Central East Borneo
» Witel of Northern East Borneo
» Witel of Southern East Borneo
» Regional Division VII Eastern Indonesia Area
» Witel of SouthSulawesi AR TELKOM 2014 ENG
» Witel of Western South Sulawesi
» Witel of North Sulawesi North Maluku
» Witel of Maluku AR TELKOM 2014 ENG
» Witel of Papua AR TELKOM 2014 ENG
» PT Telekomunikasi Selular Telkomsel
» PT Telekomunikasi Indonesia Internasional Telin
» Telin Singapore AR TELKOM 2014 ENG
» Telin Hong Kong AR TELKOM 2014 ENG
» Telin Timor-Leste AR TELKOM 2014 ENG
» Telkom Australia AR TELKOM 2014 ENG
» Telkom Macau AR TELKOM 2014 ENG
» Telkom Taiwan AR TELKOM 2014 ENG
» Telin Malaysia AR TELKOM 2014 ENG
» Telkom USA AR TELKOM 2014 ENG
» Telin Branch Office in Myanmar
» PT Multimedia Nusantara Metra
» PT Infrastruktur Telekomunikasi Indonesia
» PT Dayamitra Telekomunikasi Mitratel
» PT Infomedia Nusantara AR TELKOM 2014 ENG
» PT MD Media AR TELKOM 2014 ENG
» PT Sigma Cipta Caraka Telkom Sigma
» PT Administrasi Medika AdMedika
» PT Finnet Indonesia AR TELKOM 2014 ENG
» PT Melon Indonesia AR TELKOM 2014 ENG
» Telkom Property PT Graha Sarana Duta
» PT Telkom Akses AR TELKOM 2014 ENG
» Fixed Wireline Services AR TELKOM 2014 ENG
» Fixed Broadband AR TELKOM 2014 ENG
» Cellular Services AR TELKOM 2014 ENG
» Fixed Wireless Services AR TELKOM 2014 ENG
» Interconnection Services AR TELKOM 2014 ENG
» Network Services AR TELKOM 2014 ENG
» Satellite AR TELKOM 2014 ENG
» Platform Services, which includes Managed
» Digital Advertising is a commercial service for the
» Contact centers AR TELKOM 2014 ENG
» Partnership Stores AR TELKOM 2014 ENG
» Authorized dealers and retail outlets
» Account Management Teams AR TELKOM 2014 ENG
» Telkom Solution Houses AR TELKOM 2014 ENG
» SME Centers AR TELKOM 2014 ENG
» Social Media AR TELKOM 2014 ENG
» Liabilities dan Equity a. Current Liabilities
» Revenues Total revenues increased by Rp6,729 billion, or 8.1, from
» Expenses Total expenses increased by Rp3,693 billion, or 6.4,
» Net Income per Share Net income per share increased by Rp2,4, or 1.6, from
» Revenues Total revenues increased by Rp5,824 billion, or 7.5,
» Expenses Total expenses increased by Rp3,695 billion, or 6.8,
» Income Tax Expense Income tax expense decreased by Rp993 billion, or
» Profit for the Year Attributable to Owners of the Parent Company
» Cash Flows from Operating Activities Net cash provided by operating activities in 2014 was
» Cash Flows from Investing Activities Net cash flows used in investing activities in 2014 was
» Cash Flows from Financing Activities Net cash flows used in financing activities was Rp10,083
» Cash Flows from Operating Activities Net cash provided by operating activities in 2013 was
» Cash Flows from Investing Activities Net cash flows used in investing activities in 2013 was
» Internal Liquidity Sources To fulfill our obligations, we rely primarily on our internal
» External Liquidity Sources Our primary external sources of liquidity are short and
» Outstanding Liquidity Sources We had undrawn loan facilities which include the following
» Purpose of the Commitment As of December 31, 2014, we had material commitments
» Source of Funds We have historically funded our capital expenditures
» Denomination of Currency As of December 31, 2014, details of material commitment
» Planned Actions to Mitigate Foreign Exchange Risks
» Expansion - On January 16, 2014, we establish 100 ownership
» Acquisition - On September 25, 2014, Telkom Australia Telin through
» Employee benefits Under PSAK, the actuarial gains or losses are recognized
» Land rights Under PSAK, land rights are recorded as part of property
» Related party transactions Under Bapepam - LK OJK Regulation No. VIII.G.7
» Indonesian Taxation DebtCapital Restructure
» Dividends Dividends declared by us out of retained earnings and
» Capital Gains The sale or transfer of common stock through the IDX
» Stamp Duty Stock transactions in Indonesia are subject to stamp
» Threshold Passive Foreign Investment Company “PFIC” Classification Matters
» Dividends Any cash distributions paid by us out of earnings and
» PFIC Considerations If we were to be classified as a PFIC in any taxable year,
» Backup Withholding Tax and Information Reporting Requirements
» Telecommunications Law AR TELKOM 2014 ENG
» Telecommunications Regulators AR TELKOM 2014 ENG
» C l a ss i f i c at i o n a n d L i ce n s i n g o f Telecommunications Providers
» Introduction of Competition in the Indonesian Telecommunications Industry
» DLD Services AR TELKOM 2014 ENG
» IDD Services AR TELKOM 2014 ENG
» Limited Mobility Wireless Services
» Interconnection AR TELKOM 2014 ENG
» Consumer Protection AR TELKOM 2014 ENG
» Telecommunication Regulatory Charges AR TELKOM 2014 ENG
» Telecommunications Towers AR TELKOM 2014 ENG
» Telkom’s Shareholders AR TELKOM 2014 ENG
» Realization of General Meeting of Shareholders GMS
» President Director as CEO of Telkom Group
» Director of Network, IT Solution “NITS”
» Director of Human Capital Management “HCM”
» Director of Wholesale International Service “WINS”
» Nomination and Remuneration Committee The composition of the Nomination and Remuneration
» Audit Committee The composition of the Audit Committee as determined
» The Planning and Risk Evaluation and Monitoring Committee “KEMPR”
» Nomination and Remuneration Committee Duties and responsibilities of the Nomination and
» The Audit Committee Based on the Audit Committee Charter, in general, the
» Report of the Nomination and Remuneration Committee in 2014
» Report of the Audit Committee in 2014
» Corporate Strategic Scenario “CSS” KEMPR has monitored the implementation of RJPP CSS
» Annual Business Budget Plan In carrying RKAP 2014, the Board of Commissioners has
» Enterprise Risk Management “Enterprise Risk Management”
» Measures of Directors that require approval from the Board of Commissioners
» Work Meeting KEMPR In 2014 KEMPR held 10 committee meetings.
» Bayu Katon Management Report On Internal Control Over Financial Reporting
» Efforts to provide value added to the management of the company
» Enterprise Risk Management ERM Telkom realizes that risk management is an integral part
» Political and Social Risks Current political and social events in Indonesia may
» Macro Economic Risks AR TELKOM 2014 ENG
» Disaster Risks AR TELKOM 2014 ENG
» Risks Related to Our Business
» Operational Risks A material failure in the continuing operations of our
» Financial Risks We are exposed to interest rate risk
» Legal and Compliance Risks If we are found liable for price fixing by the Indonesian
» Regulation Risks We operate in a legal and regulatory environment that
» Risks Related to Our Fixed Telecommunication Business
» Competition Risks Related to Our Cellular Business Telkomsel
» QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
» Foreign Exchange Controls Indonesia operates a liberal foreign exchange system
» Exchange Rate Risk We are exposed to foreign exchange risk on sales,
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