These consolidated financial statements are originally issued in Bahasa.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2015 and for the year then ended Expressed in millions of Rupiah, unless otherwise stated
57
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
v. Other assets continued
Abandoned properties represent Bank and Subsidiaries’ fixed assets in form of property which were not used for Bank and Subsidiaries’ business operational activity.
Repossessed assets and abandoned properties are presented at their net realisable values. Net realisable value is the fair value of the repossessed assets less estimated costs of liquidating the
repossessed assets. Any excess of the loan balance over the value of the repossessed assets, which is not recoverable from the borrower, is charged to the allowance for impairment losses.
Differences between the estimated realisable value and the proceeds from sale of the repossessed assets are recognised as current year’s gain or loss at the time of sale.
Expenses for maintaining repossessed assets and abandoned properties are recognised in the current year’s consolidated statement of profit or loss and other comprehensive income. Any
permanent impairment occurred will be charged to the current year’s consolidated statement of profit or loss and other comprehensive income. Refer to Note 2t for changes in accounting policy
to determine impairment losses on repossessed assets and abandoned properties.
w. Obligation due immediately
Obligations due immediately are recorded at the time of the obligations occurred from customer or other banks. Obligation due immediately are classified as financial liabilities at amortised cost.
x. Deposits from customers
Deposits from customers are the funds placed by customers excluding banks with the Bank and Subsidiaries which operate in banking industry based on a fund deposit agreements. Included in
this account are demand deposits, saving deposits, time deposits and other similar deposits.
Demand deposits represent deposits of customers that may be used as instruments of payment, and which may be withdrawn at any time by cheque, automated teller machine card ATM or other
orders of payment or transfers. Saving deposits represent deposits of customers that may only be withdrawn over the counter and
via ATMs or funds transfers by SMS Banking, Phone Banking and Internet Banking when certain agreed conditions are met, but which may not be withdrawn by cheque or other equivalent
instruments.
Time deposits represent customers deposits that may only be withdrawn after a certain time based on the agreement between the depositor and the Bank. These are stated at amortised cost in the
certificates between the Bank and the holders of time deposits.
Included in demand deposits are wadiah demand and saving deposits. Wadiah demand deposits can be used as payment instruments and can be withdrawn any time using cheque and bilyet giro.
Wadiah demand and saving deposits earn bonus based on BSM’s policy. Wadiah saving and demand deposits are stated at the Subsidiaries’s liability amount.
Deposits from customers are classified as financial liabilities at amortised cost. Incremental costs directly attributable to acquistion of deposits from customers are included in the amount of
deposits and amortised over the expected life of the deposits. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost.
These consolidated financial statements are originally issued in Bahasa.
PT BANK MANDIRI PERSERO Tbk. AND SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2015 and for the year then ended Expressed in millions of Rupiah, unless otherwise stated
58
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued
y. Deposits from other banks
Deposits from other banks represent liabilities to local and overseas banks, in the form of demand deposits, saving deposits, inter-bank call money with original maturities of 90 days or less, time
deposits and negotiable certificate of deposits. Deposits from other banks are recorded as liability to other banks.
Included in the deposits from other banks are sharia deposits in form of wadiah deposits, and Certificates Mudharabah Investment Bank SIMA.
Deposits from other banks are classified as financial liabilities at amortised cost. Incremental costs directly attributable to acquisition of deposits from other banks are included in the amount of
deposits and amortised over the expected life of the deposits. Refer to Note 2c for the accounting policy for financial liabilities at amortised cost.
z. Insurance contract
Insurance contracts is a contract under which the insurer accepts significant insurance risk from the policyholders. Significant insurance risk is defined as the possibility of paying significantly more
benefit to the policyholder upon the occurrence of insured event compared to the minimum benefit payable in a scenario where the insured event does not occur. Scenarios considered are those
with commercial substance.
The Subsidiaries issue insurance contracts that accepted siginificant insurance risk from the policyholders. The Subsidiary defines significant insurance risk as the possibility of having to pay
benefits on the occurence of an insured event of at least 10 more than the benefits payable if the insured event did not occur. When an insurance contract does not have significant insurance risk,
it is classified as investment contracts.
The Subsidiaries issues insurance contracts for traditional insurance product and investment- linked insurance product. Both of these products have significant insurance risk.
The Subsidiaries’s products are divided into the following main categories: •
Traditional nonparticipating life insurance, provide protection to cover the risk of death, accident, critical illness, and health of the insured. The basic sum assured will be paid upon
the occurrence of the risks covered. •
Unit-linked, is the insurance product with single and regular premium payment which linked to investment products, which provide a combined benefit of the protection and investment.
Once a contract has been classified as an insurance contract, no reclassification is subsequently performed unless the terms of the agreement are later amended. All insurance products issued by
the subsidiary has significant insurance risk.
The Subsidiary unbundles the deposit component of unit-linked contract as required by SFAS No. 62 when both the following conditions are met:
- The Subsidiary can measure separately the “deposit” component including any embedded
surrender option, i.e. without taking into account the “insurance” component; -
The Subsidiary’s accounting policies do not otherwise require to recognise all obligations and rights arising from the “deposit” component.
The Subsidiary does not separate the deposit component because only one of the above condition is met.
