PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2010 AUDITED AND MARCH 31, 2011 UNAUDITED AND
THREE MONTHS PERIOD ENDED MARCH 31, 2010 AND 2011 UNAUDITED Figures in tables are presented in millions of Rupiah, unless otherwise stated
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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
l.
Property, plant and equipment under finance leases
A lease is classified as a finance lease or operating lease based on the substance not the form of the contract. Property, plant and equipment under finance lease is recognized if the lease
transfers substantially all the risks and rewards incidental to ownership.
Finance leases are recognized as assets and liabilities in the statement of financial positions as the amounts equal to the fair value of the leased property or, if lower, the present value of the
minimum lease payments. Any initial direct costs of the Company and its subsidiaries are added to the amount recognized as an asset.
Minimum lease payments shall be apportioned between the finance charge and the reduction of the outstanding liability. The finance charge shall be allocated to each period during the lease
term so as to produce a constant periodic rate of interest on the remaining balance of the liability. Contingent rents shall be charged as expenses in the periods in which they are incurred.
Leased assets are depreciated using the same method over the shorter of the lease term and their economic useful life.
Leasing arrangements that do not meet the above criteria are accounted for as operating leases for which payments are charged as an expense on the straight-line basis over the lease period.
m. Joint Operation Schemes “Kerja Sama Operasi” or “KSO”
Revenues from KSO include amortization of unearned initial investor payments, Minimum Telkom Revenues “MTR” and the Companys share of Distributable KSO Revenues “DKSOR”.
Unearned initial investor payments received are recorded net of all direct costs incurred in connection with the KSO agreement and are amortized using the straight-line method over the
KSO period of 15 years starting from January 1, 1996.
MTR are recognized on a monthly basis based on the contracted MTR amount for the current year.
The Companys share of DKSOR is recognized on the basis of the Companys percentage share of the KSO revenues, net of MTR and operational expenses of the KSO Units, as provided in the
KSO agreements.
Under PSAK 39, “Accounting for Joint Operation Schemes”, the assets built by the KSO partners under the KSO were recorded in the books of the KSO partners which operate the assets and
would be transferred to the Company at the end of the KSO period or upon termination of the KSO agreement.
PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2010 AUDITED AND MARCH 31, 2011 UNAUDITED AND
THREE MONTHS PERIOD ENDED MARCH 31, 2010 AND 2011 UNAUDITED Figures in tables are presented in millions of Rupiah, unless otherwise stated
29
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
n. Deferred charges for land rights Costs incurred to process and extend land rights are deferred and amortized using the
straight-line method over the term of the land rights. o. Foreign currency translation
The functional currency of the Company and its subsidiaries is the Indonesian Rupiah and the accounting records of the Company and its subsidiaries are maintained in Indonesian Rupiah.
Transactions in foreign currencies are translated into Indonesian Rupiah at the rates of exchange prevailing at transaction date. At the consolidated statement of financial position date, monetary
assets and monetary liabilities balances denominated in foreign currencies are translated into Indonesian Rupiah based on the buy and sell rates quoted by Reuters prevailing at the
consolidated statement of financial position date as follows:
The Company and its subsidiaries December 31, 2010
March 31, 2011 Buy
Sell Buy
Sell United States Dollars “US” 1
9,005 9,015
8,705 8,710
Euro 1 12,011
12,025 12,368 12,379
Yen 1 110.68
110.82 105.12 105,22
The resulting foreign exchange gains or losses, realized and unrealized, are credited or charged to the consolidated statement of comprehensive income of the current year, except for foreign
exchange differences incurred on borrowings during the construction of qualifying assets which are capitalized to the extent that the borrowings can be attributed to the construction of those
qualifying assets Note 2k.
p. Revenue and expense recognition
Since January 1, 2011, the Company and its subsidiaries have adopted PSAK 23 Revised 2010, “Revenue” and ISAK 10 “Customer Loyalty Program”, which became effective for financial
statement periods beginning on or after January 1, 2011 and is applied prospectively. i.
Implementation of PPSAK 1 “Withdrawal of PSAK 35 Accounting for Telecommunication Services”
In June 2009, the Indonesian Financial Accounting Standard Board “DSAK” issued Statement of Withdrawal of Financial Accounting Standard No. 1 PPSAK 1, effective for
financial statement periods beginning on or after January 1, 2010. PPSAK 1, among other things, revokes PSAK 35 “Accounting for Revenue from Telecommunications Services”. The
Company and its subsidiaries adopted PPSAK 1 starting January 1, 2010 and applied retrospectively.The effect of such implementation include:
PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2010 AUDITED AND MARCH 31, 2011 UNAUDITED AND
THREE MONTHS PERIOD ENDED MARCH 31, 2010 AND 2011 UNAUDITED Figures in tables are presented in millions of Rupiah, unless otherwise stated
30
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued p. Revenue and expense recognition continued
