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
54
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued r. Fixed Assets, leased assets and intangible 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 repair and maintenance costs that do not have future economics benefit are recognised in the consolidated statement of profit or loss and other comprehensive
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 fixed assets and intangible 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 profit or loss and other 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.
Construction in progress is stated at cost and presented as part of fixed assets. Accumulated costs are reclassified to the appropriate fixed assets account when the assets are substantially
complete and ready for their intended use. In accordance with SFAS 16 revised 2011 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 rights is likely to or definitely not obtained.
SFAS No. 48 Revised 2014, “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.
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
55
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES continued r. Fixed assets and leased assets continued
i. Fixed assets and software continued
Bank Mandiri and Subsidiaries applied SFAS No. 16 Revised 2011 “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
Group apply SFAS No. 30 Revised 2011 “Lease”, effective beginning on or after January 1, 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 fulfilment 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 benefit related 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 related to ownership of assets.
Based on SFAS No. 30 Revised 2011, under a finance leases, Group recognise assets and liabilities in its consolidated statement of financial position as 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 expense 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 expenses recorded in the consolidated statement of income. 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 Bank Mandiri will obtain ownership by the end of the lease term.
Under an operating lease, the Group recognise lease payments as an expense on a straight-line basis over the lease term.
If a rental agreement contains elements of land and buildings, the Group assessed the classification of each element as a finance lease or an operating lease separately.
iii.Intangible assets
Intangible assets are recognized if, and if only when its cost can be measured reliably and it is probable that expected future benefits that are attributable to it will flow to the Bank and
Subsidiaries. Intangible assets consist of goodwill and computer software that are purchased by the Bank and Subsidiaries.
Software purchased by the Bank and subsidiaries is recorded at cost less accumulated amortization and accumulation of possible losses. Amortization method, estimated useful life
and residual value is reviewed at end of reporting period and adjusted if necessary. Refer to Note 2s for the accounting treatment of goodwill.
