PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2014 AND 2013
Expressed in millions of Rupiah, unless otherwise stated
Appendix 536 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
p. Consumer Financing Receivables continued
For joint financing without recourse, Subsidiary has the right to set higher interest rates to customers than those as stated in the joint financing agreements with joint financing providers.
The difference is recognised as revenue and disclosed as “Consumer financing income”.
q. Net Investment in Finance Lease
Net investment in finance lease represent lease receivable plus the residual value at the end of the lease period and net of unearned lease income, security deposits and the allowance for
impairment losses. The difference between the gross lease receivable and the present value of the lease receivable is recognised as unearned lease income. Unearned lease income is
allocated to current year consolidated statement of comprehensive income based on a constant rate of return on net investment using the effective interest rate.
The lessee has the option to purchase the leased asset at the end of the lease period at a price mutually agreed upon at the commencement of the agreement.
Early termination is treated as a cancellation of an existing contracts and the resulting gain or loss is credited or charged to the current year consolidated statement of comprehensive income.
Net investment in finance leases are classified as loans and receivables. Refer to Note 2c to the accounting policy for loans and receivables.
r. Fixed Assets and Leased Assets
i. Fixed assets and Software Fixed assets except for land is stated at cost less accumulated depreciation and impairment
losses. Such cost includes the cost of replacing part of the fixed assets when that cost is incurred, if the recognition criteria are met. Likewise, when a major inspection is performed, its
cost is recognised in the carrying amount of the fixed assets as a replacement if the recognition criteria are satisfied. All other repairs and maintenance costs that do not have future economics
benefit are recognised in the consolidated statement of income as incurred. Software is recognised as intangible assets.
Depreciation and amortisation is calculated using the straight-line method over the estimated useful lives of the assets as follows:
Years
Buildings 20
Furniture, fixtures, office equipment and computer and vehicles 4-5
Software 5
Fixed assets are derecognised upon disposal or when no future economic benefits are expected from their use or disposal. Any gain or loss arising from derecognition of the asset
calculated as the difference between the net disposal proceeds and the carrying amount of the asset is included in consolidated statement of comprehensive income in the year the asset is
derecognised.
The asset’s residual values, useful lives and methods of depreciation are reviewed, and adjusted prospectively if appropriate, at each financial year end.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
31 DECEMBER 2014 AND 2013
Expressed in millions of Rupiah, unless otherwise stated
Appendix 537 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
r. Fixed Assets and Leased Assets continued
i. Fixed assets and Software continued Construction in progress is stated at cost and is presented as part of fixed assets. Accumulated
costs are reclassified to the appropriate fixed assets account when the assets are substantially complete and are ready for their intended use.
In accordance with IAS 16 Fixed Assets and ISAK 25 Land Rights. The cost of land rights in the form of right to cultivate, right to build and use rights are recognised as fixed assets. The
acquisition cost is the cost that are directly attributable to obtain land rights, including the cost of legal rights to the land when the land was first acquired.
Land rights in the form of right to cultivate, right to build and use rights are not depreciated, unless there is evidence to indicate that the extension or renewal of land is likely to or definitely
not obtained.
SFAS No. 48 Revised 2009, “Impairment of Assets” states that the carrying amounts of fixed assets are reviewed at each consolidated statement of financial position date to assess
whether they are recorded in excess of their recoverable amounts. When carrying value exceeds this estimated recoverable amount, assets are written down to their recoverable
amount.
Bank Mandiri applied SFAS No. 16 Revised 2007 “Fixed Assets”. Bank Mandiri and Subsidiaries chose the cost model, and therefore, the balance of fixed assets revaluation
reserve at the first time adoption of SFAS No. 16 Revised 2007, which were presented in the shareholders’ equity section amounting to Rp3,046,936 in the consolidated statement of
financial position, were reclassified to appropriated retained earnings in 2008.
ii. Leased assets Bank Mandiri apply SFAS No. 30 Revised 2011 “Lease”, effective beginning on or after
1 January 2012. Under SFAS No. 30 Revised 2011, determination of whether an agreement is a lease agreement or lease agreement containing the substance of the agreement based on
the inception date and whether the fulfillment of the agreement depends on the use of an asset and the agreement provides a right to use the asset. According to this revised SFAS, leases
that transfer substantially all the risks and rewards incidental to ownership, are classified as finance leases. Further, a lease is classified as operating leases, if the lease does not transfer
substantially all the risks and benefits incidental to ownership of assets.
Based on SFAS No. 30 Revised 2011, under a finance leases, Bank and Subsidiaries recognise assets and liabilities in its consolidated statement of financial position at amounts
equal to the fair value of the leased property or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease. Lease payment is apportioned
between the finance charge and the reduction of the outstanding liability. The finance charge is 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. Finance charges are reflected in the consolidated statement of income. Capitalised leased assets presented under fixed assets
are depreciated over the shorter of the estimated useful life of the assets and the lease term, if there is no reasonable certainty that the Bank will obtain ownership by the end of the lease
term.
