ASSETS AND LIABILITIES DENOMINATED IN FOREIGN CURRENCIES continued FINANCIAL RISK MANAGEMENT continued FINANCIAL RISK MANAGEMENT continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2015 and for the Six Months Period Then Ended Unaudited Figures in tables are expressed in billions of Rupiah, unless otherwise stated 124

42. FINANCIAL RISK MANAGEMENT continued

1. Financial risk management continued a. Foreign exchange risk The Group is exposed to foreign exchange risk on sales, purchases and borrowings that are denominated in foreign currencies. The foreign currency denominated transactions are primarily in U.S. dollars and Japanese yen. The Group PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2015 and for the Six Months Period Then Ended Unaudited Figures in tables are expressed in billions of Rupiah, unless otherwise stated 125

42. FINANCIAL RISK MANAGEMENT continued

c. Interest rate risk Interest rate fluctuation is monitored to minimize any negative impact to financial performance. Borrowings at variable interest rates expose the Group to interest rate risk Notes 16, 17, 18, 19 and 20. To measure market risk pertaining to fluctuations in interest rates, the Group primarily uses interest margin and maturity profile of the financial assets and liabilities based on changing schedule of the interest rate. At reporting date, the interest rate profile of the Group PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2015 and for the Six Months Period Then Ended Unaudited Figures in tables are expressed in billions of Rupiah, unless otherwise stated 126

42. FINANCIAL RISK MANAGEMENT continued

e. Liquidity risk continue Prudent liquidity risk management implies maintaining sufficient cash in order to meet the Group PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of June 30, 2015 and for the Six Months Period Then Ended Unaudited Figures in tables are expressed in billions of Rupiah, unless otherwise stated 127

42. FINANCIAL RISK MANAGEMENT continued