PT SINAR MAS MULTIARTHA Tbk AND ITS SUBSIDIARIES Notes to Consolidated Financial Statements
For the Years Ended December 31, 2014 and 2013 Figures are Presented in Millions of Rupiah,unless Otherwise Stated
The carrying value of the Group’s financial assets classified as held to maturity and loans and receivables as of December 31, 2014 and 2013 are as follows:
2014 2013
Held to Maturity Short-term investments - securities - bonds
69,726 -
Loans and Receivables Cash and cash in banks
2,637,727 2,599,638
Securities purchased under agreements to resell -
139,211 Short-term investments - placements with other banks
308,569 593,813
Short-term investments - time deposits 3,767,547
1,950,998 Short-term investments - securities - export bill receivables
170,213 207,001
Consumer finance receivables - net 597,058
895,987 Factoring receivables - net
1,398,689 1,144,066
Receivables from brokers 263,426
378,544 Other receivables - net
2,105,313 623,751
Loans - net 12,519,290
9,924,090 Acceptance receivables
67,836 238,324
Other assets 33,264
25,940 Total
23,868,932 18,721,363
e. Impairment of AFS Equity Investments
The Group follows the guidance of PSAK No. 55 Revised 2011 to determine when an AFS equity investment is impaired. This determination requires significant judgment. In making
this judgment, the Group evaluates, among other factors, the duration and extent to which the fair value of an investment is less than its cost; and the financial health of and short-term
business outlook for the investee, including factors such as industry and sector performance, changes in technology and operational and financing cash flow.
If all of the decline in fair value below cost were considered significant or prolonged, the Group would suffer an additional loss in consolidated financial statements, being the
transfer of the accumulated fair value adjustments recognized in equity on the impaired AFS financial assets to the profit or loss.
f. Lease Commitmens
Group as Lessee The Group has entered into various lease agreements for commercial spaces. The Group
has determined that it is an operating lease since the Group does not bear substantially all the significant risks and rewards of ownership of the related assets.
Group as Lessor The Group has entered into various commercial lease agreements. The Group has
determined that it is an operating lease since the Group bears substantially all the significant risks and rewards of ownership of the related assets.
- 46 -
PT SINAR MAS MULTIARTHA Tbk AND ITS SUBSIDIARIES Notes to Consolidated Financial Statements
For the Years Ended December 31, 2014 and 2013 Figures are Presented in Millions of Rupiah,unless Otherwise Stated
g. Income Tax
Significant judgment is required in determining the provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain due
to different interpretation of tax regulations. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will have an impact
on the current and deferred income tax assets and liabilities in the period in which such determination is made.
Estimates and Assumptions The key assumptions concerning the future and other key sources of estimation uncertainty at
the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period are disclosed below. The Group
based its assumptions and estimates on parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future developments
may change due to market changes on circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur:
a. Fair Value of Financial Assets and Financial Liabilities
Indonesian Financial Accounting Standards require measurement of certain financial assets and liabilities at fair values, and the disclosure requires the use of estimates. Significant
component of fair value measurement is determined based on verifiable objective evidence i.e. foreign exchange rate, interest rate, while timing and amount of changes in fair value
might differ due to different valuation method used. The fair value of financial assets and liabilities are set out in Note 52.
b. Estimated Useful Lives of Investment Properties and Property and Equipment
The useful life of each of the item of the Group’s investment properties and property and equipment are estimated based on the period over which the asset is expected to be
available for use. Such estimation is based on a collective assessment of similar business, internal technical evaluation and experience with similar assets. The estimated useful life of
each asset is reviewed periodically and updated if expectations differ from previous estimates due to physical wear and tear, technical or commercial obsolescence, and legal
or other limits on the use of the asset. It is possible, however, that future results of operations could be materially affected by changes in the amounts and timing of recorded
expenses brought about by changes in the factors mentioned above. A reduction in the estimated useful life of any item of investment properties and property and equipment would
increase the recorded depreciation and decrease the carrying values of these assets. There is no change in the estimated useful lives of investment properties and property and
equipment during the year. The carrying value of these assets are further explained in Notes 18 and 19.
- 47 -
