Subsidiaries and Associates continued PT Mandiri AXA General Insurance continued

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2012 AND 2011 Expressed in millions of Rupiah, unless otherwise stated Appendix 514 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued

a. Basis of Preparation of the Consolidated Financial Statements continued

All figures in the consolidated financial statements, are rounded and presented in million rupiah Rp unless otherwise stated.

b. Changes in accounting policies

On 1 January 2012, the Group applied new and revised statements of financial accounting standards SFAS and interpretations ISAK effective starting on that date. Changes to the Group’s accounting policies, in accordance with the transitional provisions in the respective standards and interpretations. The adaption of the following new or revised standards and interpretations, which are relevant to the Groups operations and resulted in an effect on the consolidated financial statements, are as follows: b.i. SFAS 60 - Financial Instruments: Disclosures The new standard consolidated and expands a number of existing disclosure requirements and adds some new disclosures. The over riding principle of the standard is to disclose sufficient information that enables users of financial statements evaluating the performance and financial position of significant financial instruments owned by an entity. SFAS 60 requires more extensive disclosures on risks and risk management, and requires reporting entities to report the sensitivity of its financial instruments to movement of such risks. Some additional new disclosures are as follows: 1 Qualitative and quantitative disclosure on the impact of certain risks, including market risk, credit risk and liquidity risk; 2 Additional disclosure for those items that affect the amount of comprehensive income, in which gains and losses are separated by category of financial instruments, and 3 Disclosure of fair value for each class of financial assets and financial liabilities, and disclosure of the fair value hierarchy of financial instruments measured at fair value at the reporting date. The Group has incorporated disclosures requirements of SFAS No. 60 for the consolidated financial statements as at and for the year ended 31 December 2012. The Group has decided to early adopt improvements on SFAS 60 refer to Note 65. b.ii. SFAS 62 - Insurance Contract Several revisions which have impact to the Subsidiary are as follows: a. The Subsidiary is required to comply with the requirement on unbundling deposit component from insurance component subject to the following: - Unbundling is required if both the following conditions are met i the Subsidiary can measure the deposit component including any embedded surrender options separately i.e. without considering the insurance component and ii the Subsidiary’s accounting policies do not otherwise require it to recognise all obligations and rights arising from the deposit component; - Unbundling is permitted, but not required, if the Subsidiary can measure the deposit component separately but its accounting policies require it to recognise all obligations and rights arising from the deposit component, regardless of the basis used to measure those rights and obligations; and - Unbundling is prohibited if the Subsidiary cannot measure the deposit component separately.