PROPERTY AND EQUIPMENT continued

PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2014 and for the Nine months Period Then Ended unaudited Figures in tables are expressed in billions of rupiah, unless otherwise stated 56

11. PROPERTY AND EQUIPMENT continued

c. Others continued vi The Company and subsidiaries own several pieces of land rights located throughout Indonesia with Building Use Rights “Hak Guna Bangunan” or “HGB” for a period of 10 – 45 years which will expire between 2014 and 2059. Management believes that there will be no issue in obtaining the extension of the land rights when they expire. vii As of September 30, 2014, the Company and subsidiaries’ property and equipment except land rights, with net carrying amount of Rp83,400 billion were insured against fire, theft, earthquake and other specified risks, with a maximum loss claim of Rp6,660 billion, US67 million, EUROnil , SGD21.5 million and HKD20.61 million, and on a first loss basis of Rp6,203 billion including business recovery of Rp200 billion with the Automatic Reinstatement of Loss Clause. In addition, Telkom-1 and Telkom-2 were insured separately for US2.78 million and US24.42 million, respectively. Management believes that the insurance coverage is adequate to cover potential losses from the insured risks. viii As of September 30, 2014, the percentage of completion of property under construction was around 67.13 of the total contract value, with estimated dates of completion between September 2014 and December 2015. The balance of property under construction mainly consists of buildings, transmission installation and equipment, cable network and power supply. Management believes that there is no impediment to the completion of the construction in progress. ix All assets owned by the Company have been pledged as collateral for bonds Note 20a. Certain property and equipment of the Company’s subsidiaries with gross carrying value amounting to Rp6,924 billion have been pledged as collateral under lending agreements Notes 17 and 21. x As of September 30, 2014 and December 31, 2013 the cost of fully depreciated property and equipment of the Company and subsidiaries that are still used in operations amounted to Rp32,580 billion and Rp40,791 billion. The Company and subsidiaries are currently performing modernization of network assets to replace the fully depreciated property and equipment. xi The Company and Telkomsel entered into several agreements with PT Profesional Telekomunikasi Indonesia, PT Tower Bersama Infrastructure Tbk, PT Solusindo Kreasi Pratama, PT Prima Media Selaras, PT Naragita Dinamika Komunika and other tower providers to lease spaces in telecommunication towers slot and sites of the towers for a period of 10 years. The Company and Telkomsel may extend the lease period based on the agreement by both parties. In addition, the Company and subsidiaries also have lease commitments for property and equipment under RSA, transmission installation and equipment, data processing equipment, office equipment, vehicles and CPE assets with the option to purchase certain leased assets at the end of the lease terms. PERUSAHAAN PERSEROAN PERSERO PT TELEKOMUNIKASI INDONESIA Tbk AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS As of September 30, 2014 and for the Nine months Period Then Ended unaudited Figures in tables are expressed in billions of rupiah, unless otherwise stated 57

11. PROPERTY AND EQUIPMENT continued