Assets a. Current Assets

g. Other Income Other income decreased by Rp1,505 billion, from Rp2,579 billion in 2013 to Rp1,074 billion in 2014 as we had recognized a gain on the sale of 80 of our ownership in PT Indonusa.

2. Expenses Total expenses increased by Rp3,693 billion, or 6.4,

from Rp57,700 billion in 2013 to Rp61,393 billion in 2014. For futher explaination as shown below: a. Operations, Maintenance and Telecommunication Service Expenses Operations, maintenance and telecommunication service expenses increased by Rp2,956 billion, or 15.3, from Rp19,332 billion in 2013 to Rp22,288 billion in 2014. The increase in operations, maintenance and telecommunication service expenses was primarily attributable the following: - Operations and maintenance of Rp1,916 billion, or 18.0, due to an increase in expenses associated with network maintenance to improve our cellular business performance; - Leased lines and CPE increased by Rp318 billion, or 72.3, which was used for operation and maintenance of leased lines as a result of an increased in projects from our corporate customers; - Cost of phone, set top boxes, SIM and RUIM cards increase by Rp279 billion, or 37.1, from Rp752 billion in 2013 to Rp1,031 billion in 2014 due to modem and terminal bundling program. The above increases were offset by a decrease in cost of IT services decreased by Rp320 billion, or 47.3, from Rp677 billion in 2013 to Rp357 billion in 2014 due to efficiency gain as a result of using an from integrated system. b. Depreciation and Amortization Expenses Depreciation and amortization expenses increased by Rp1,352 billion, or 8.6, from Rp15,780 billion in 2013 to Rp17,131 billion in 2014, primarily due to an increase in depreciation expense related to switching equipment as an efforts improving service to customers and by our allowance for impairment losses of fixed assets due to changes in business strategies for our fixed wireless phone. c. Personnel Expenses Personnel expenses decreased by Rp117 billion, or 1.2, from Rp9,733 billion in 2013 to Rp9,616 billion in 2014 due to a decreased by Rp300 billion, or 80.2 in net periodic post-retirement health care benefit and a decrease in net periodic pension cost by Rp228 billion, or 26.1, due to actuarial calculations. The decreased was offset by increase in salaries and related benefits by Rp206 billion or 5.8 due to an increase in employee number by 1,37 from 25,011 people in 2013 to 25,284 people in 2014. This resulted in increase in employees’ income tax by Rp157 billion, or 13.5, from Rp1,160 billion in 2013 to Rp1,317 billion in 2014. d. Interconnection Expense Interconnection expense decreased by Rp34 billion, or 0.7, from Rp4,927 billion in 2013 to Rp4,893 billion in 2014 primarily due to an decrease of Rp81 billion, or 2.2 in domestic interconnection and transit interconnection expense. e. Marketing Expense Marketing expenses increased by Rp48 billion, or 1.6, from Rp3,044 billion in 2013 to Rp3,092 billion in 2014 due to an increase of Rp80 billion, or 15.1, in customer education expenses primarly for our broadband service. The increase was offset by decrease in advertising and promotion expenses by Rp18 billion, or 0.7, due to the selective use of media for promotion and increase group synergy to market the product. 124 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 S