PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED continued JUNE 30, 2008 AND 2009,
AND SIX MONTHS PERIOD ENDED JUNE 30, 2008 AND 2009 Figures in tables are presented in millions of Rupiah, unless otherwise stated
19
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements of the Company and its subsidiaries have been prepared in accordance with generally accepted accounting principles in Indonesia “Indonesian GAAP”.
a. Basis of preparation of financial statements
The consolidated financial statements, except for the consolidated statements of cash flows, are prepared on the accrual basis of accounting. The measurement basis used is historical cost,
except for certain accounts recorded on the basis described in the related accounting policies.
The consolidated statements of cash flows are prepared using the direct method and present the changes in cash and cash equivalents from operating, investing and financing activities.
Figures in the consolidated financial statements are rounded to and presented in millions of Indonesian Rupiah “Rp.”, unless otherwise stated.
b. Principles of consolidation The consolidated financial statements include the financial statements of the Company and its
subsidiaries in which the Company, directly or indirectly has ownership of more than 50, or the Company has the ability to control the entity, even though the ownership is less than or equal to
50. Subsidiaries are consolidated from the date on which effective control is obtained and are no longer consolidated from the date of disposal.
All significant inter-company balances and transactions have been eliminated on the consolidated financial statements.
c. Transactions with related parties
The Company and its subsidiaries have transactions with related parties. The definition of related parties used is in accordance with Indonesian Statement of Financial Accounting Standards
Pernyataan Standar Akuntansi Keuangan or “PSAK” 7, “Related Party Disclosures”.
d. Acquisitions of subsidiaries
The acquisition of a subsidiary from a third party is accounted for using the purchase method of accounting. The cost of an acquisition is allocated to the identifiable assets and liabilities
recognized using as reference, their fair values at the date of the transaction. The excess of the acquisition cost over the Companys interest in the fair value of identifiable assets acquired and
liabilities assumed is recorded as goodwill and amortized using the straight-line method over a period of not more than five years, except longer period but not more than twenty years can be
justified. The Company continually assesses whether events or changes in circumstances have occurred
that would require revision of the remaining estimated useful life of intangible assets and goodwill, or whether there is any indication of impairment. If any indication of impairment exists, the
recoverable amount of intangible assets and goodwill is estimated based on the expected future cash flows which are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS UNAUDITED continued JUNE 30, 2008 AND 2009,
AND SIX MONTHS PERIOD ENDED JUNE 30, 2008 AND 2009 Figures in tables are presented in millions of Rupiah, unless otherwise stated
20
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued d. Acquisitions of subsidiaries continued
