Interim Consolidated Financial Statements
Table of Contents Page
Directors’ Statement Letter
Interim Consolidated Financial Statements
As of September 30, 2015 (Unaudited) and December 31, 2014 (Audited) and For the 9 (Nine) Months Period Ended September 30, 2015 and 2014 (Unaudited)
Interim Consolidated Statements of Financial Position 1
Interim Consolidated Statements of Comprehensive Income 3
Interim Consolidated Statements of Changes in Equity 4
Interim Consolidated Statements of Cash Flows 5
Notes to the Consolidated Financial Statements 6
The accompanying notes form an integral part of these consolidated financial statements
Notes September 30, 2015 December 31, 2014
Rp Rp
ASSETS
CURRENT ASSETS
Cash and Cash Equivalents 2.d, 2.e, 2.f, 2.r, 3, 10, 32, 33 180,058,662,280 279,958,770,048
Trade Receivables 2.r, 2.u, 4, 33
Related Parties 2.f, 10 8,825,123,799 3,549,747,601
Third Parties 520,956,486,644 389,096,670,786
Other Current Financial Assets 2.r, 5, 33 5,940,988,451 9,435,126,642
Inventories 2.g, 2.k, 6 123,678,605,656 105,857,883,964
Prepaid Taxes 2.q, 7.a 6,991,423,747 6,991,423,747
Prepaid Expenses 2.h, 8 90,926,068,266 45,907,747,875
Total Current Assets 937,377,358,842 840,797,370,663
NON-CURRENT ASSETS
Advances 9 132,497,773,160 84,624,464,968
Due from Related Parties Non-Trade 2.f, 2.r, 10, 33 34,291,027,372 1,341,961,213
Property and Equipment 2.i, 2.k, 2.u, 12 1,581,371,855,850 1,589,306,930,919
Goodwill 2.l, 2.m, 13.a 282,568,092,907 282,568,092,907
Intangible Assets 2.m, 2.u, 13.b 10,090,101,453 9,605,766,175
Deferred Tax Assets 2.q, 7.d 24,496,853,741 22,442,922,330
Other Non-Current Financial Assets 11 11,043,201,421 13,398,002,929
Total Non-Current Assets 2,076,358,905,903 2,003,288,141,441
The accompanying notes form an integral part of these
LIABILITIES AND EQUITY Notes September 30, 2015 December 31, 2014
Rp Rp
LIABILITIES
CURRENT LIABILITIES
Trade Payables - Third Parties 2.r, 14, 33 229,351,660,599 192,762,995,806
Short-Term Bank Loans 2.r, 17, 33 2,586,226,452 3,540,195,011
Accrued Expenses 2.f, 2.r, 10, 16, 33 235,125,582,359 145,004,370,941
Advances from Patients 2.p 16,833,898,503 14,914,613,299
Taxes Payable 2.q, 7.b 30,565,195,495 33,130,693,777
Other Current Financial Liabilities 2.r, 15, 33 79,422,071,868 64,476,339,112
Current Portion of Long-Term-Bank Loans 2.r, 17, 33 12,969,341,132 12,435,856,488
Current Portion of Deferred Gain on
Sale and Leaseback Transactions 2.j, 18, 36.a 11,897,445,548 11,897,445,548
Total Current Liabilities 618,751,421,955 478,162,509,982
NON-CURRENT LIABILITIES
Long-Term Bank Loans 2.r, 17, 33 20,734,166,973 30,525,083,739
Due to Related Parties Non-Trade 2.f, 2.r, 10, 33 416,491,944,412 415,813,668,549
Deferred Gain on Sale and Leaseback Transactions 2.j, 18, 36.a 110,010,626,647 118,909,263,993
Long-Term Employment Benefit Liabilities 2.n, 19 115,938,595,957 118,858,564,915
Deferred Tax Liabilities 2.q, 7.d 27,917,206,895 28,147,868,966
Total Non-Current Liabilities 691,092,540,884 712,254,450,162
Total Liabilities 1,309,843,962,839 1,190,416,960,144
EQUITY
Equity Attributable to Owners of the Parent Capital Stock, par Value - Rp100 per Share
Authorized Capital - 4,000,000,000 shares
Issued and Fully Paid: 20 115,610,000,000 115,610,000,000
1,156,100,000 Shares as of December 31, 2014 and 2013;
Additional Paid-in Capital - Net 2.o, 21 1,289,664,515,321 1,289,664,515,321
Difference in Value from Non-controlling Interest 22 (35,431,929,951) (25,748,354,393)
Retained Earnings 345,686,237,816 281,300,384,006
Other Comphrehensive Income 2.n, 39 (12,622,920,294) (12,622,920,294)
Total Equity Attributable to Owners of the Parent 1,702,905,902,892 1,648,203,624,640
Non-Controlling Interest 2.c, 25 986,399,015 5,464,927,320
TOTAL EQUITY 1,703,892,301,906 1,653,668,551,960
The accompanying notes form an integral part of these consolidated financial statements
2015 2014
Notes (9 Months) (9 Months)
Rp Rp
REVENUE 2.p, 26 3,013,142,142,653 2,415,291,830,694
COST OF REVENUE 2.p, 27 (2,156,668,016,584) (1,748,120,010,193)
GROSS PROFIT 856,474,126,069 667,171,820,501
Operating Expenses 2.f, 2.p, 10, 28 (694,664,909,010) (553,621,340,469)
Others - Net (20,885,623,267) (12,920,157,835)
PROFIT FROM OPERATION 140,923,593,792 100,630,322,197
Interest Income 29 4,040,130,277 12,041,784,471
Financial Charges 29 (41,922,232,218) (48,346,899,604)
PROFIT BEFORE TAX 103,041,491,850 64,325,207,064
Tax Expenses 2.q, 7.c (35,436,134,827) (13,015,516,256)
PROFIT FOR THE PERIOD 67,605,357,023 51,309,690,808
OTHER COMPREHENSIVE INCOME --
--TOTAL COMPREHENSIVE INCOME
FOR THE PERIOD 67,605,357,023 51,309,690,808
PROFIT FOR THE PERIOD ATTRIBUTABLE TO:
Owners of the Parent Company 70,397,573,758 54,310,067,492
Non-Controlling Interest 2.c (2,792,216,735) (3,000,376,684)
67,605,357,023 51,309,690,808
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD ATTRIBUTABLE TO:
Owners of the Parent Company 70,397,573,758 54,310,067,492
Non-Controlling Interest 2.c (2,792,216,735) (3,000,376,684)
67,605,357,023 51,309,690,808
EARNINGS PER SHARE
Basic, Profit for the Period Attributable to
The accompanying notes form an integral part of these consolidated financial statements
Capital Stock Total Equity Non-Controlling Total
Appropriated Unappropriated Total Other Attributable to Interest Equity Difference in Value Difference in Value Comprehensive Owners of the
Paid-in between from Non-Controlling Income Parent Capital Entities Under Change in Equity Interest
Excess of Common Control- Transactions of Par Net Subsidiaries Total
Notes Rp Rp Rp Rp Rp Rp Rp Rp Rp Rp Rp Rp Rp
BALANCE AS OF DECEMBER 31, 2013 115,610,000,000 1,312,722,950,000 (11,329,652,726) (11,728,781,953) 1,289,664,515,321 -- -- 206,108,534,831 206,108,534,831 -- 1,611,383,050,152 27,608,728,827 1,638,991,778,979
` ` ` ` ` ` `
Changes in Equity for September 30, 2014
Non-Controlling Interest -- -- -- -- -- -- -- -- -- -- -- (1,439,338,074) (1,439,338,074)
Total Comprehensive Income for the Period -- -- -- -- -- -- -- 54,310,067,492 54,310,067,492 -- 54,310,067,492 (3,000,376,684) 51,309,690,808
BALANCE AS OF SEPTEMBER 30, 2014 115,610,000,000 1,312,722,950,000 (11,329,652,726) (11,728,781,953) 1,289,664,515,321 -- -- 260,418,602,323 260,418,602,323 -- 1,665,693,117,644 23,169,014,069 1,688,862,131,713
BALANCE AS OF DECEMBER 31, 2014 115,610,000,000 1,312,722,950,000 (11,329,652,726) (11,728,781,953) 1,289,664,515,321 (25,748,354,393) 23,100,000,000 245,577,463,712 268,677,463,712 1,648,203,624,640 5,464,927,320 1,653,668,551,960
Restatement for PSAK 24 (Revised 2013)
39 -- -- -- -- -- -- -- 12,622,920,294 12,622,920,294 (12,622,920,294) -- --
--BALANCE AS OF DECEMBER 31, 2014
(After Restated) 115,610,000,000 1,312,722,950,000 (11,329,652,726) (11,728,781,953) 1,289,664,515,321 (25,748,354,393) 23,100,000,000 258,200,384,006 281,300,384,006 (12,622,920,294) 1,648,203,624,640 5,464,927,320 1,653,668,551,960 Changes in Equity for September 30, 2015
Divident 23 -- -- -- -- -- -- -- (6,011,719,948) (6,011,719,948) -- (6,011,719,948) -- (6,011,719,948)
Non-Controlling Interest -- -- -- -- -- (9,683,575,558) -- -- -- -- (9,683,575,558) (1,686,311,570) (11,369,887,129)
Total Comprehensive Income for the Period -- -- -- -- -- -- -- 70,397,573,758 70,397,573,758 -- 70,397,573,758 (2,792,216,735) 67,605,357,023
BALANCE AS OF SEPTEMBER 30, 2015 115,610,000,000 1,312,722,950,000 (11,329,652,726) (11,728,781,953) 1,289,664,515,321 (35,431,929,951) 23,100,000,000 322,586,237,816 345,686,237,816 (12,622,920,294) 1,702,905,902,892 986,399,015 1,703,892,301,906 Total Equity Attributable to Owner of Parent
The accompanying notes form an integral part of these consolidated financial statements
September 30, 2015 September 30, 2014
(9 Months) (9 Months)
Rp Rp
CASH FLOWS FROM OPERATING ACTIVITIES
Collections from Customers 2,877,926,235,817 2,334,230,813,473
Payments to Suppliers and Third Parties (2,116,830,299,640) (1,648,878,065,240)
Payments to Management and Employees (521,588,602,221) (394,758,350,842)
Cash Flows from Operations 239,507,333,956 290,594,397,391
Financial Charges Payment - Net (9,710,189,545) (4,927,616,836)
Payments of Taxes (17,166,734,547) (16,712,885,295)
Net Cash Provided by Operating Activities 212,630,409,864 268,953,895,260
CASH FLOWS FROM INVESTING ACTIVITIES
Advances for Purchase of Property and Equipment and Others (73,541,773,128) (40,982,714,490)
Property and Equipment and Software
Disposal 34,084,005 347,579,515
Acquisition (217,957,674,968) (271,704,462,167)
Acquisition of Subsidiaries -- (11,731,480,787)
Payments of Dividend (6,011,720,008)
--Net Cash Used in Investing Activities (297,477,084,099) (324,071,077,929)
CASH FLOWS FROM FINANCING ACTIVITIES
Receipts from (Payment to) Related Parties (3,500,000,000) (47,078,183,567)
Payments of Bank Loan (10,211,400,681) (9,956,667,197)
Net Cash Used in Financing Activities (13,711,400,681) (57,034,850,764)
NET DECREASE IN CASH AND CASH EQUIVALENTS (98,558,074,916) (112,152,033,433)
Effect of Foreign Exchange on Cash and Cash Equivalents
at the End of the Period (1,342,032,851) (4,332,226,795)
CASH AND CASH EQUIVALENTS AT BEGINNING PERIOD 279,958,770,048 515,437,837,445
CASH AND CASH EQUIVALENTS AT ENDING PERIOD 180,058,662,280 398,953,577,217
1. General
1.a. The Company’s Establishment
PT Siloam International Hospitals Tbk. (“the Company”) was established under the name of PT Sentralindo Wirasta on August 3, 1996 based on the Deed of Establishment No. 3, which was made in the presence of Myra Yuwono, S.H., a notary in Sukabumi. The deed of establishment was approved by
the Minister of Justice of the Republic of Indonesia in his decree No. C2-8639.HT.01.01.TH.
’
96. datedAugust 27, 1996 and was published in the State Gazette No. 97, Supplement No. 9518 on December 3, 1996.
The Company’s articles of association have been amended several times, and the changed was by Notarial Deed No. 10 dated June 12, 2015, made in the presence of Nurlani Yusup, S.H., M.Kn., a notary in Tangerang, about changes in the Company’s articles of association. Notification of changes the Company’s articles of association have been received by the Minister of Law and Human Rights of
the Republic of Indonesia in his decree No. AHU-AH.01.03-0942343 dated June 17, 2015.
In accordance with Article 3 of the Company's articles of association, the Company's principal activity is engage in healthcare provision, including setting up and managing hospitals, polyclinics, health facilities and supporting infrastructure, and engaging in government healthcare programs.
The Company commenced commercial operations in 2010 after the restructuring of PT Lippo Karawaci Tbk’s hospital units. The Company's principal activity is engage in healthcare provision, including setting up and managing hospitals. The operation of hospital units of the Company and the subsidiaries (the Group) are in several cities on the island of Sumatera, Java, Bali, Kalimantan, Sulawesi and Nusa Tenggara.
The Company’s head office is located at Building of Faculty Medicine UPH , 32th. Floor. JL. Bouleverad
Jend.Sudirman No.15, Tangerang 15810, Banten - Indonesia. The parent entity of the Company is PT
Megapratama Karya Persada and the ultimate parent entity is PT Lippo Karawaci Tbk.
1.b. The Company’s Initial Public Offering
The Company’s initial public offering of 156,100,000 shares was declared effective by the Indonesian Financial Services Authority in its letter No. S-260/D.04/2013 dated September 2, 2013, and was listed in the Indonesian Stock Exchange on September 12, 2013.
1.c. The Group’s Structure
Dom icile Main Direct Indirect Year of
Business Ownership Ownership Starting Septem ber 30, 2015 Decem ber 31, 2014
Percentage Percentage Operation Rp Rp
PT Balikpapan Damai Husada Balikpapan Healthcare -- 79.61% 2007 188,028,325,765 198,183,010,595
including
Dom icile Main Direct Indirect Year of
Business Ownership Ownership Starting Septem ber 30, 2015 Decem ber 31, 2014
Percentage Percentage Operation Rp Rp
PT Koridor Usaha Maju and Subsidiaries Tangerang Trading, -- 99.99% -- 480,431,482,030 458,363,437,079 Dev elopment,
Printing, Agribusiness,
Serv ices and Transport
On July 23, 2014, TPP and MBS, acquired 75% and 25%, respectively, ownership in PT Rashal Siar Cakra Medika (RSCM), at the acquisition cost of Rp78,540,426,657 and Rp26,180,142,219, respectively. This transaction represent business combination (see Note 30). RSCM commenced commercial operations in 2008.
On November 28, 2014, TPP acquired 20% ownership of MST from Steer Clear Limited, at the acquisition cost of Rp45,030,000,000. Difference from acquisition cost and investment value amounted to Rp25,748,354,393.
1.d. Board of Commissioners, Directors, Employees and Audit Committee
Based on Notarial Deed No. 09 dated June 12, 2015, made in the presence of Nurlani Yusup, S.H., M.Kn., Notary in Tangerang, which has been accepted by the Ministry of Law and Human Rights of the
Republic of Indonesia through notification No. AHU-AH.01.03-0942314 dated June 17, 2015, the
composition of the Board of Commisioners and Directors as of September 30, 2015 and December 31, 2014, are as follows:
Domicile Main Direct Indirect Year of
Business Ownership Ownership Starting September 30, 2015 December 31, 2014 Percentage Percentage Operation Rp Rp
President Commissioner Ketut Budi Wijaya Ketut Budi Wijaya
Commissioner Theo Leo Sambuaga Theo Leo Sambuaga
Jenny Kuistono Rahmawaty
President Director Romeo Fernandez Lledo *) Romeo Fernandez Lledo *)
Director Kailas N. Raina Grace Frelita Indradjaja
Prof. George Mathew Andry
dr. Grace Frelita Indradjaja Kailas N. Raina
dr. Anang Prayudi George Mathew
dr. Andry Anang Prayudi *)
Richard Hendro Setiadi WP.
The audit committee composition as of September 30, 2015 and December 31, 2014 are as follows:
As of September 30, 2015 and December 31, 2014, the Company’s Corporate Secretary is Cindy Riswantyo and Sugianganto Budisuharto, respectively. Head of internal audit is Gunawan HP.
As of September 30, 2015 and December 31, 2014, the Group have 6,565 and 6,547 permanent employees, respectively (unaudited).
2. Summary of Significant Accounting Policies
2.a. Compliance with the Financial Accounting Standards
The Group’s consolidated financial statements have been prepared and presented in accordance with the Indonesian Financial Accounting Standards which include the Statements and the Interpretations as issued by the Financial Accounting Standards Board of the Indonesian Institute of Accountants (DSAK-IAI) and Regulation of Bapepam-LK No. VIII.G.7 regarding the “Guidance of Financial Statements Presentation” asset forth in decree No. KEP-347/BL/2012 regarding the amendment to Regulation No. VIII.G.7 and other accounting policies which prevailing in the Capital Market.
2.b. Basis of Measurement and Preparation of Consolidated Financial Statements
The consolidated financial statements have been prepared on a going concern assumption and on the accrual basis, except for the consolidated statements of cash flows which used the cash basis. The basis of measurement in the preparation of these consolidated financial statements is the historical cost principle, except for certain accounts that were measured using other basis, as described in the respective accounting policy.
The consolidated statements of cash flows have been presented by classifying the activities into operating, investing and financing. The cash flows from operating activities were prepared using the direct method.
The functional currency of the Group is Indonesian Rupiah. Transactions are recorded using the functional currency. The reporting currency used in the preparation of these consolidated financial statements is the Indonesian Rupiah.
The following new Interpretations of financial accounting standard (ISAK) are effective on 1 January 2015 to the Group's consolidated financial statements:
-PSAK No. 1 (Revised 2013) “Presentation of financial statements”
-PSAK No. 4 (Revised 2013) “Separate financial statements”
-PSAK No. 15 (Revised 2013) “Investment in associates and joint ventures”
-PSAK No. 24 (Revised 2013) “Employee benefits”
-PSAK No. 46 (Revised 2014) ”Income Tax”
-PSAK No. 48 (Revised 2014) “Asset Impairment”
-PSAK No. 50 (Revised 2014) “Financial Instruments: Presentation”
-PSAK No. 55 (Revised 2014) “Financial Instruments: Recognition and Measurement”
-PSAK No. 60 (Revised 2014) “Financial Instruments: Disclosure”
-PSAK No. 65 “Consolidated financial statements”
Audit Committee
Chairman Farid Harianto
Members Lie Kwang Tak
-PSAK No. 66 “Joint arrangements”
-PSAK No. 67 “Disclosure of interests in other entities”
-PSAK No. 68 “Fair value measurement”
ISAK which will be effective in the financial year beginning January 1, 2015 are as follows
-ISAK No. 26 (Revised 2014) “Reassessment of Embedded Derivative”
:
2.c. Principles of Consolidation
The consolidated financial statements include the accounts of the Company and its subsidiaries controlled directly with the percentage of ownership more than 50% as presented in Note 1.c.
Control also exists when the parent entity owns half or less of the voting power of an entity when there is:
a. power over more than half of the voting rights by virtue of an agreement with other investors;
b. power to govern the financial and operating policies of the entity under a statute or an agreement;
c. power to appoint or remove the majority of the members of the board of directors or equivalent
governing body and control of the entity is by that board or body; or
d. power to cast the majority of votes in the meetings of the board of directors or equivalent governing
body and control of the entity is by that board or body.
The existence and effect of potential voting rights that can be implemented or converted on the date of the reporting period should be considered when assessing whether an entity has the power to govern financial and operating policies of another.
The entities are consolidated from the date on which control was transferred to the Company and are no longer consolidated when the Company ceases to have control. Control is obtained when the entity has the power to govern the financial and operating policies of another entity to obtain the benefits of the entity activity.
The consolidated financial statements have been prepared on the basis of entity concept. All significant related intercompany accounts, transactions and profits among the consolidated companies have been eliminated to reflect the financial position and result of operations as a whole entity.
The changes in the Company’s ownership interest in a subsidiary that do not result to a loss of control are accounted for as equity transactions and attributed to the owners of the parent.
All major transactions and inter-company account balances (including significant unrealized gain or loss) have been eliminated.
Non-controlling interest reflects the profit or loss and net assets of subsidiaries portion that are not attributable directly or indirectly to the parent entity, which is presented in the consolidated statements of profit or loss and other comprehensive income and as equity in the consolidated statements of financial position, separated from portion which is attributable to parent.
2.d. Foreign Currency Transactions
A foreign currency is a currency other than the functional currency. Transactions during the current
period using foreign currencies were recorded at the spot rate prevailing on the transaction date.
Gains and losses from foreign exchange differences arising from foreign currency transactions into
Rupiah were charged to profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency shall be translated using the exchange rate at the date of transaction. Non-monetary items that are measured at fair value in a foreign currency shall be translated using the exchange rate when the fair value was determined.
2.e. Cash and Cash Equivalent
Cash consist of cash on hand and in banks, are not used as collateral and not restricted.
Cash equivalent consists of time deposits certificates with maturities of not more than or equal to six (6) months from the date of placement and are not restricted.
2.f. Transactions with Related Parties
A related party is a person or entity that is related to the Company (referred to as the “reporting entity”), which includes:
a) A person or a close member of that person’s family is related to a reporting entity if that person:
(i) has control or joint control over the reporting entity;
(ii) has significant influence over the reporting entity;
(iii)is a member of the key management personnel of the reporting entity or of a parent of the
reporting entity.
b) An entity is related to the reporting entity if any of following conditions applies:
(i) The entity and the reporting entity are members of the same group (which means that each
parent, subsidiary and fellow subsidiary is related to the others);
(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of a
member of a group of which the other entity is a member);
(iii)Both entities are joint ventures of the same third party;
(iv)One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
(v)The entity is a post-employment benefit plan for the benefit of employees of either the reporting
entity or an entity related to the reporting entity. If the reporting entity is managing the plan, the sponsoring entity is also related to the reporting entity;
(vi)The entity is controlled or jointly controlled by a person identified in (a); or
(vii)A person identified in (a) (i) has significant influence over the entity or is a member of the key
management personnel of the entity (or a parent of the entity).
2.g. Inventories
Inventories are stated at the lower of cost or net realizable value. Cost is determined by the average method. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and selling cost. In determining obsolete inventory, the Group conducts a regular review of each unit individually significant inventory and when obtained reliable evidence, the
Group will reduce the value of inventories to realizable value.
September 30, 2015 December 31, 2014
Rp Rp
1 United State Dollar (USD) 14,657 12,440
1 Euro (EUR) 16,492 15,133
1 Singapore Dollar (SGD) 10,274 9,422
2.h. Prepaid Expenses
Prepaid expenses are amortized over the period benefitted using straight line method.
2.i. Property and Equipment
At initial recognition, property and equipment are measured at acquisition cost.
After initial recognition, property and equipment except land are accounted for using the cost model which is carried at cost less accumulated depreciation and accumulated impairment losses. Land is not depreciated and carried at cost less accumulated impairment losses.
Depreciation is computed by using the straight line method based on the estimated useful lives of the assets as follows:
Building, Infrastructure and Renovations 4 - 20
Years
Equipment and Medical Supplies 4 - 8
Furniture, Fixtures and Office Equipment 4 - 10
Vehicles 5
The cost of repairs and maintenance is charged to profit or loss as incurred while significant renovations and addition which add estimated useful life or future economic benefits are capitalized. When assets are retired or otherwise disposed of, the cost and the related accumulated depreciation and accumulated impairment loss, if any, are removed from the accounts and any resulting gains or losses are charged to operations for the relevant period.
Accumulated construction costs of property and equipment are capitalized as "Construction in Progress " and recorded in "Property and Equipment" account until the construction process is completed. These
costs are reclassified to property and equipment when the construction are completed.
The carrying amount of property and equipment is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is credited or charged to operations in the period the asset is derecognized.
Management has reviewed the estimated useful lives, depreciation methods and residual values of the
propery and equipment, at each reporting period. Necessary adjustments made prospectively.
2.j. Leases
The determination of whether an arrangement 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.
Leases are classified as finance leases if the lease substantially transferred all the risks and benefits related to ownership of the asset. Leases are classified as operating leases if the lease did not substantially transfer all the risks and benefits related to ownership of the asset.
and recognized as an asset. Leased asset depreciation policy is consistent with the policy for the Group’s own property and equipment.
Under an operating lease, the Group recognizes lease payments as an expense on a straight-line basis over the lease term.
The Group recognizes lease receivables in the consolidated statements of financial position as a net lease investment. Collection of leases are considered as payments of lease principal and finance lease income. Recognition of finance lease income is based on a pattern reflecting a constant periodic rate of return on the Group's net investment as lessor in a finance lease.
Group as lessor
The Group is required to present assets subject to operating leases in its consolidated statements of financial position according to the nature of the asset. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognized as an expense over the lease term on the same basis as operating rental income. Contingent rents, if any, are recognized as revenue in the periods in which they are earned. Lease income from operating leases is recognized as income on a straight-line basis over the lease term.
A sale and leaseback transaction involves the sale of an asset and leasing back the same asset. If a sale and leaseback transaction is a finance lease, any excess of sales proceeds over the carrying value is not immediately recognized as income in the consolidated financial statements of a seller (lessee) but is deferred and amortized over the lease period.
Sale and Leaseback
If a sale and leaseback transaction is an operating lease, and it is clear that the transaction is established at fair value, any profit or loss is recognized immediately. If the sales price is below fair value, any profit or loss is recognized immediately except if the loss is compensated by future lease payments below market price where it is deferred and amortized in proportion to the lease payments over the period for which the asset is expected to be used.
2.k. Impairment of Non-Financial Assets
The recover amount of non-financial assets shall be estimated at the time of the events or changes in circumstances indicate that the carrying value may not be recoverable. An impairment loss is recognized in the current period.
Impairment loss been recognized in prior periods is reversed if and only if, there is a change in the estimate used to determine the assets recoverable amount since the last impairment loss is recognized.
If so, the carrying amount of the asset is increased to its recoverable amount.
The increase is a reversal of an impairment loss. The carrying amount of assets increased due to the reversal of an impairment loss, should not exceed the carrying amount of the asset if no impairment loss for the previous period.
2.l. Business Combination
The Group accounts for each business combination by applying the acquisition method, including measuring non-controlling interest.
The Group recognizes the identifiable assets acquired and liabilities taken over at their fair value on the acquisition date, except for the following:
• Deferred tax assets or liabilities that are related to assets acquired and liabilities taken over in
business combination are recognized and measured in accordance with PSAK No. 46 (Revised 2010), “Income Taxes”.
• Liabilities (or assets, if any) related to employee benefit arrangements from the acquiree are
recognized and measured in accordance with PSAK No. 24 (Revised 2010), “Employee Benefits”.
• Liabilities or equity instruments related to the replacement of an acquiree’s share-based payment
awards are measured in accordance with PSAK No. 53 (Revised 2010), “Share-based Payment”.
• Non-current assets (or disposal groups) acquired which are classified as held for sale are measured
in accordance with PSAK No. 58 (Revised 2009), “Non-current Assets Held for Sale and Discontinued Operations”.
2.m.Intangible Assets
Goodwill arising in a business combination is recognized as an asset on the date that control is acquired.
Goodwill
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any noncontrolling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree over the net of the acquisition date amounts of the identifiable assets acquired and the liabilities taken over.
Goodwill is not amortized but is reviewed for impairment at least annually or more frequently when there is an indication that the goodwill may be impaired. For the purpose of impairment testing, goodwill is allocated to each of the cash-generating units expected to benefit from the synergies of the combination.
If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit prorated on the basis of the carrying amount of each asset in the unit. An impairment loss is charged to the consolidated statements of comprehensive income for the current period. An impairment loss recognized for goodwill is not reversed in the subsequent period, whereas the negative goodwill that resulted from bargain purchases is recognized as gain in profit or loss. The gain is attributed to the acquirer.
If goodwill has been allocated to a cash-generating unit and certain operations on the cash-generating unit is stopped, the goodwill associated with discontinued operations are included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill removed is measured based on the relative value of discontinued operations and share of the cash-generating unit retained.
Software costs are initially recognized at cost or amounts attributable to the assets at the time of acquisition.
Cost of Software
Acquisition cost of accounting software is deferred and amortized using the straight line method based on the estimated economic useful life of five (5) years.
2.n. Employee Benefits
In 2015, the Group has adopted PSAK 24 (Revised 2013), consequently, has made a retrospective adjustment on the actuarial gains or losses recognised as other comprehensive income.
Short-term employee benefits are recognized as wages and salaries for rendered services to the Company during the accounting period.
Short-term employee benefits
The Group has a defined benefit pension plan without funding for all its permanent employees and have computed and recorded a provision for employee post-employment benefits in accordance with the Labour Law No. 13/2003 and PSAK No. 24 (Revised 2013), "Employee Benefits".
Post-employment Benefits
Post-employment benefits are recognized at a discounted amount when the employees have rendered services to the company during the accounting period. Liabilities and expenses are measured using actuarial techniques which include constructive obligation that arises from the Group’s common practices. In calculating such liabilities, the benefit must be discounted using the projected unit credit method. Past service cost is recognized in profit or loss when the benefit becomes vested and recognized as an expense using the straight-line method for the average period of vested benefit. Accumulated unrecognized actuarial gain (loss) that is more than 10% of the present value of defined benefit liabilities are amortized using the straight line method over the remaining projected average service period of employees in the programme.
2.o. Difference in Value between Entities Under Common Control
Transactions business combination between entities under common control, such as transfers of assets, liabilities, shares or other ownership instruments by re-organizing entities within the same group, do not represent changes of ownership in terms of economic substance, and thus, should not result in a gain or loss for the group of companies as a whole or for the individual entity in the groups.
Since transactions with entities under common control do not result in changes in term of economic substance of ownership in transferred assets, liabilities or other ownership instruments, the transferred assets or liabilities (in legal form) should be recorded at book value in a manner similar to business combination transactions using the pooling of interest method.
The difference between transfer price and book value does not represent goodwill. Such difference is recorded in the account “Difference in Value from Restructuring Transactions between Entities under Common Control” and is presented in additional paid in capital as part of equity and can not be recognized as realized gain nor loss is reclassified to retained earning.
2.p. Revenue and Expense Recognition
Revenue is recognized when medical services are rendered or when medical supplies are delivered to patients.
Expenses are recognized when incurred.
2.q. Income Tax
Current income tax is calculated from taxable income, the earnings that have been adjusted to the appropriate tax rules.
Amendments to taxation liabilities are recorded when an assessment is received or, if appealed against, when the results of the appeal are determined.
Current tax assets and current tax liabilites are offset if, and only if, the entity:
1) has a legally enforceable right to set off the recognised amount; and
2) intends to settle in net basis, or realises and settles the asset and liability simultaneously.
financial reporting purposes are recognized as deferred tax using the balance sheet liability method. Currently or substantially enacted tax rates are used to determine deferred income tax.
Deferred tax assets and deferred tax liabilites are offset if, and only if, the entity:
1) has a legally enforceable right to set off current tax asset against current tax liability; and
2) the deferred tax asset and the deferred tax liability relate to income taxes levied by the same tax
authority on the same taxable entity.
2.r. Financial Instruments
The Group classified its financial assets into four (4) categories, as follows (i) financial assets measured at fair value through profit or loss (FVTPL), (ii) loans and receivables, (iii) held-to-maturity financial assets (HTM financial assets) and (iv) available-for-sale financial assets (AFS financial assets). The classification depends on the purpose for which the financial assets were acquired. The management determines the classification of its financial assets at initial recognition.
Financial Assets
(i) Financial Assets at FVTPL
Financial assets which are recognized as FVTPL are financial assets for trading. Assets are classified in this category when they are held principally for the purpose of selling or repurchasing in the near term and there is evidence of a recent actual pattern of short-term profit taking. Derivatives are classified as trading assets, except when designated and effective as hedging instruments
At initial recognition, financial assets are measured at fair value through profit or loss are recognized at fair value. Transaction costs in connection with the acquisition are recognized in profit or loss for
the period. The increase or decrease in fair value recognized in profit or loss subsequently.
(ii) Loans and Receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are initially recognized at fair value plus transaction costs and are subsequently measured at amortized cost using the effective interest rate method.
(iii)HTM Financial Assets
HTM investments are non-derivative financial assets with fixed or determinable payments and fixed maturity that management has the positive intention and ability to hold to maturity, other than:
a. Investments which from initial recognition, were designated as financial assets measured at
FVTPL;
b. Investments which are designated as available-for-sale; and
c. Investments that meet the definition of loans and receivables.
At initial recognition, HTM investments are recognized at fair value plus transaction costs and are subsequently measured at amortized cost using the effective interest rate method.
(iv)AFS Financial Assets
AFS financial asset are non-derivative financial assets that are held during a certain period with the intention for sale in order to fulfill liquidity needs, changes in interest rates or foreign exchange, or those that are not classified as loans and receivables, investments that are classified as held-to-maturity or financial assets at fair value through profit or loss.
Financial Liabilities and Equity Instruments
Classification as debt or equity
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements entered into and the definitions of financial liabilities and equity instruments.
Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. Equity instruments are recorded as the proceeds received, net of direct issue costs. Share issuance costs are presented as part of equity under "Additional Paid-in Capital – Net”.
Financial Liabilities
Financial liabilities are classified into the categories of (i) financial liabilities measured at fair value
through profit or loss (FVTPL) and (ii) financial liabilities measured at amortized cost.
(i) Financial liabilities measured at FVTPL
Financial liabilities at fair value through profit or loss are the financial liabilities that are designated for trading. Financial liabilities are classified for trading if acquired primarily for the purpose of selling or repurchasing in the near term and there is evidence of a pattern of short-term profit taking. Derivatives are classified as trading liabilities except those effectively designated as hedging instruments.
At initial recognition, financial liabilities measured at amortized cost are recognized at fair value net
of transaction costs and subsequently measured at amortized cost using the effective interest rate.
(ii) Financial Liabilities Measured at Amortized Cost
Financial liabilities not classified as financial liabilities at fair value through profit or loss are categorized and measured using amortized cost.
At initial recognition, financial liabilities measured at amortized cost are recognized at fair value net of transaction costs and subsequently measured at amortized cost using the effective interest rate method.
Impairment of Financial Assets
Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the reporting date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. For listed and unlisted equity investments classified as AFS, a significant or prolonged decline in the fair value of the equity investment below its cost is considered to be an objective evidence of impairment.
Some objective evidence for impairment value are as follows:
• significant financial difficulty of the issuer or counterparty; or
• default or delinquency in interest or principal payments; or
• it becoming probable that the borrower will enter bankruptcy or financial reorganization.
conditions that correlate with default on receivables.
For financial assets carried at amortized cost, the amount of impairment is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.
The carrying amount of the financial asset is directly reduced by the amount of impairment loss for all financial assets with the exception of receivables, where the carrying amount is reduced through the use of an allowance account. When a receivable is considered uncollectible, it is written-off against the allowance account. Subsequent recoveries of amounts previously written-off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognized in the profit or loss.
When an AFS financial asset is considered to be impaired, cumulative gains or losses previously recognized in equity are reclassified to the profit or loss.
With the exception of AFS equity instruments, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognized, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment on the date of the impairment is reversed does not exceed the amortized cost had there been no impairment recognized.
In respect of AFS equity securities, impairment losses previously recognized in the consolidated statement of comprehensive income are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognized directly in equity.
Reclassification of Financial Assets
Reclassification is only permitted in rare circumstances and where the asset is no longer held for the purpose of selling in the short-term. In all cases, reclassification of financial assets is limited to debt instruments. Reclassifications are accounted for at the fair value of the financial asset on the date of reclassification.
Offsetting of Financial Instruments
Financial assets and liabilities are offset and the net amount is reported in the consolidated statements of financial position when there is a legally enforceable right to offset the recognized amounts and there is an intention to settle on a net basis, or realize the asset and settle the liability simultaneously.
Derecognition of Financial Assets and Liabilities
The Group derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognizes their retained interest in the asset and an associated liability for the amounts they may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.
The Group derecognizes financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or expired.
Effective Interest Method
The effective interest method is a method of calculating the amortized cost of a financial instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and others paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial instrument, or, where appropriate, a shorter period to the net carrying amount on initial recognition.
Income is recognized on an effective interest basis for financial instruments other than those financial
instruments at FVTPL.
Fair Value Determination
The fair value of financial assets and liabilities must be estimated for recognition and measurement or for disclosure purposes.
PSAK No. 60, “Financial Instruments: Disclosures” requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:
(i) quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1)
(ii) inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (as prices) or indirectly (derived from prices) (Level 2), and
(iii)inputs for the asset or liability that are not based on observable market data (unobservable inputs)
(Level 3).
The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. The quoted market price used for financial assets held by the Group is the current bid price, while ask price is used for financial liabilities. These instruments are included in Level 1.
The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. These valuation techniques maximize the use of observable market data where it is available and rely as minimum as possible on estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.
If one or more of the significant inputs is not based on observable market data, the instrument is included in Level 3. This is the case for unlisted equity securities.
2.s. Earnings Per Share
Earnings per share is computed by dividing income attributable to the parent by the weighted average
number of common shares outstanding during the period.
Diluted earnings per share is computed considering other securities that potentially have a dilutive effect
to ordinary shares outstanding during the reporting period.
2.t. Operating Segments
Operating segments are identified based on internal reports on components of the Group that are regularly reviewed by the "operational decision maker" in allocating resources and assessing
performance of the operating segments.
The Group evaluates operating segments based on the business activities of each hospital unit which is a strategic unit that promote products and services in different service areas. Products and services are managed separately because each unit hospital requires different market strategies and resources. Segment accounting policies are the same as described in the summary of significant accounting
policies.
2.u. Significant Accounting Estimation and Justification
The preparation of the consolidated financial statements in accordance with the Indonesian Financial Accounting Standards requires the management to make assumptions and estimates that could affect the carrying amounts of certain assets and liabilities at end of reporting period.
In the preparation of these consolidated financial statements, accounting assumptions have been made in the process of applying accounting policies that may affect the carrying amounts of assets and liabilties in the consolidated financial statements. In addition, there are accounting assumptions about the sources of estimation uncertainty at end of reporting period that could materially affect the carrying amounts of assets and liabilities in the subsequent reporting period.
The management periodically reviews them to ensure that the assumptions and estimates have been made based on all relevant information available on the date in which the consolidated financial statements have been prepared. Because there is inherent uncertainty in making estimates, the value of assets and liabilities to be reported in the future might differ from those estimates.
i. Significant Accounting Estimations and Justification
At the reporting date, the management has made significant assumptions and estimates which have the most significant impact to the carrying amount recognized in the consolidated financial statements are as follows:
Allowance for Impairment of Accounts Receivable
In general, the management analyzes the adequacy of the allowance for impairment based on several data, which include analyzing historical bad debts, the concentration of each customer's trade receivables, credit worthiness and changes in a given period of repayment. The analysis is carried out individually on a significant amount of accounts receivable, while the insignificant group of trade receivables is carried on the collective basis. At the reporting date, the carrying amount of trade receivables has been reflected at fair value and the carrying value may change materially in the subsequent reporting period. The change, however, will not be attributable to the assumptions and estimates made as of this reporting date (see Note 4).
Deferred Tax Assets Estimation
Recognition of deferred tax assets is performed only if it is probable that the asset will be recovered in the form of economic benefits to be received in future periods, in which the temporary differences and tax losses can still be used. Management also considers the future estimated taxable income and strategic tax planning in order to evaluate its deferred tax assets in accordance with applicable tax laws and its updates. As a result, related to its inherent nature, it is likely that the calculation of deferred taxes is related to a complex pattern where assessment requires a judgment and is not expected to provide an accurate calculation. Estimated Deferred tax disclose to the Note 7.d.
Estimated Useful Lifes of Property and Equipment
“Accounting Policies, Changes in Accounting Estimates and Errors”. Carring value of property and equipment disclose to the Note 12.
Post-employment Benefits
The present value of post-employment benefits obligation depends on several factors that are determined on an actuarial basis based on several assumptions. Assumptions used to determine the cost (income) include the discount rate. Changes in these assumptions will affect the carrying amount of post-employment benefits.
The Group determines the appropriate discount rate at the end of the reporting period by the interest rate used to determine the present value of future cash outflows expected to settle an estimated obligation. In determining the appropriate level of interest rates, the Group considers the interest rate of government bonds denominated in Rupiah that have a similar period to the corresponding period of the obligation.
Another key assumption is partly determined by current market conditions during the period in which the post-employment benefits is resolved. Changes in the employee benefits assumption will impact recognition of actuarial gains or losses at the end of the reporting period. Information about assumtion and balance of liability and post employment benefits expense disclose to the Note 19.
Fair Value of Financial Instruments
When the fair value of financial assets and liabilities recorded in the consolidated statements of financial position is not available in an active market, it is determined using valuation techniques including the use of mathematical models. Input for this model is derived from observable market data through the data available. When observable market data is not available, management judgment is required to determine
the fair value. Such considerations include liquidity and volatility feedback model for derivative transactions and long-term discount rates, prepayments, and default rate assumptions. Fair value of financial instruments disclose to the Note 33.
ii. Significant Consideration in the Determination of Accounting Policies
The following considerations made by management in the application of accounting policies that have significant effect on the amount presented in the financial statements:
Revenue Recognition – Doctors Fee
3. Cash and Cash Equivalents
Interest rates and maturity period of the time deposits are as follows:
There are no cash and cash equivalent pledged as collateral and restricted.
September 30, 2015 December 31, 2014
Rp Rp
Cash on Hand 8,802,395,092 4,686,173,378
Cash in Banks Related Party
Rupiah
PT Bank Nationalnobu Tbk 41,140,036,855 28,610,235,853
Third Parties
Rupiah
PT Bank Negara Indonesia (Persero) Tbk 30,542,970,577 64,786,797,252
PT Bank CIMB Niaga Tbk 27,038,141,043 23,952,651,436
PT Bank Central Asia Tbk 9,305,959,101 26,979,098,279
PT Bank Mandiri (Persero) Tbk 8,262,556,057 16,847,350,898
PT Bank Rakyat Indonesia (Persero) Tbk 6,215,210,177 3,125,898,534
Others (below Rp1 billion each) 2,808,161,053 1,505,945,728
Foreign Currencies SGD
PT Bank CIMB Niaga Tbk 10,207,296,224 36,742,787,678
PT Bank International Indonesia Tbk 3,341,296,486 3,060,587,810
USD
PT Bank ANZ Indonesia 3,283,348,281 9,572,022,812
PT Bank Negara Indonesia (Persero) Tbk 1,607,593,190 1,594,322,497
Others (below Rp1 billion each) 606,321,835 438,730,064
EURO
PT Bank ANZ Indonesia 3,385,145,182 2,679,901,063
Others (below Rp1 billion each) 359,360,061 1,769,016,147
AUD
PT Bank ANZ Indonesia 4,202,871,066 4,086,002,246
Subtotal 152,306,267,188 225,751,348,297
Time Deposits - Third Parties
Rupiah
PT Bank CIMB Niaga Tbk 18,900,000,000 43,570,717,986
PT Bank Mandiri (Persero) Tbk 0 5,900,530,387
PT Bank Negara Indonesia (Persero) Tbk 50,000,000 50,000,000
Subtotal 18,950,000,000 49,521,248,373
Total 180,058,662,280 279,958,770,048
September 30, 2015 December 31, 2014
Rupiah
Annual Contractual Interest Rates 3,0% - 8,75% 4% - 10%
4. Trade Receivables
The movements in allowance for impairment losses are as follows:
All trade receivables are denominated in Rupiah.
Trade receivables of PT Golden First Atlanta, a subsidiary, are pledged as collateral for loans obtained from PT Bank Central Asia Tbk (see Note 17).
Based on management’s review of the individual account of the trade receivables at the end of the reporting date, there were impairment on certain trade receivables. Management has provided adequate allowance for impairment losses based on the Group's accounting policies.
Management believes that the allowance was made because the receivables cannot be collected and is adequate to cover possible losses from uncollectible accounts.
September 30, 2015 December 31, 2014
Rp Rp
Related Parties (see Note 10) 8,825,123,799 3,549,747,601
Third Parties
Enterprise 492,037,060,156 362,159,592,394
Individual 27,475,154,904 21,979,027,324
Credit Card 9,595,305,827 12,149,167,644
Others (below Rp500 million each) 6,403,084,142 7,363,001,809
Subtotal 535,510,605,029 403,650,789,171
Less: Allowance for Impairment losses (14,554,118,385) (14,554,118,385)
Trade Receivables - Third Parties - Net 520,956,486,644 389,096,670,786
Net 529,781,610,443 392,646,418,387
September 30, 2015 December 31, 2014
Rp Rp
Third Parties
Beginning Balance 14,554,118,385 8,734,468,948
Addition -- 6,275,399,274
Reversal -- (455,749,837)
5. Other Current Financial Assets
Rental receivables represent receivables from retail tenants of the leased area in the hospital building.
As of September 30, 2015, the Group did not provide allowance for impairment losses on the receivables because management believes that all receivables are collectible.
6. Inventories
The Group’s inventory have been insured againts all forms of risk by PT Lippo General Insurance Tbk, a related party, amounting to Rp267,696,772,804 and Rp144,482,221,851 as of September 30, 2015 and December 31, 2014, respectively. The management believes that insurance coverage is adequate to cover possible losses of the insured assets.
The medicine and consumable goods of PT Golden First Atlanta, a subsidiary, are pledged as collateral for loans obtained from PT Bank Central Asia Tbk (see Note 17).
The amount of inventories charged to cost of sales for the 9 (Nine) months ended September 30, 2015 and
2014 amounted to Rp661,150,065,147 and Rp641,350,189,805, respectively (see Note 27).
The management believes that there is no indication of impairment of inventory as of September 30, 2015.
7. Taxes
a. Prepaid Tax
This account represent prepaid income tax article 28.A amounting Rp6,991,423,747 as of September 30, 2015 and December 31, 2014.
September 30, 2015 December 31, 2014
Rp Rp
Other Current Financial Assets - Third Parties
Rental Receivables 2,578,918,960 4,620,197,836
Others (below Rp1 million each) 3,362,069,491 4,814,928,806
Total 5,940,988,451 9,435,126,642
September 30, 2015 December 31, 2014
Rp Rp
Medicine 39,076,277,784 55,372,035,426
Medical Supplies 79,213,703,880 45,608,886,699
Others 5,388,623,992 4,876,961,839
b. Taxes Payable
c. Taxes Expense
Current Tax
The calculation of estimated current tax expense and corporate income tax payable of the Company are
as follows:
September 30, 2015 December 31, 2014
Rp Rp
Income Tax
Article 4 (2) 1,781,137,099 1,125,399,126
Article 21 10,696,958,291 15,285,439,574
Article 23 879,838,468 360,508,411
Article 26 1,179,920 1,179,920
Article 25/29
The Company 12,471,563,658 2,020,164,583
Subsidiaries 3,891,329,220 13,901,085,091
Value Added Tax 843,188,839 436,917,072
Total 30,565,195,495 33,130,693,777
2015 2014
(9 Months) (9 Months)
The Company Subsidiaries Consilidated The Company Subsidiaries Consilidated The Company
Rp Rp Rp Rp Rp Rp Rp
Current Tax Expense - non Final 27,371,128,000 10,349,600,308 37,720,728,308 14,996,034,000 -- 14,996,034,000 8,244,875,000
Deferred Tax Expense (4,140,511,884) 1,855,918,403 (2,284,593,482) (2,577,220,813) 596,703,069 (1,980,517,744) (5,120,771,987)
Consolidated Tax Expense - Net 23,230,616,116 12,205,518,711 35,436,134,827 12,418,813,187 596,703,069 13,015,516,256 3,124,103,013
(9 Months) (9 Months)
Rp Rp
Profit Before Tax as
Consolidated Statements of Comprehensive Income - Interm 103,041,491,850 64,325,207,064
Less: Loss Before Tax of Subsidiaries 12,424,599,316 7,105,453,767
Profit Before Tax of the Company 90,616,892,534 57,219,753,297
Timing Differences:
Employee Benefits 4,816,948,284 14,558,583,273
In this Consolidated Financial Statements, Estimated Taxable Income is based on the interim calculation since the Company has not submitted the Annual Tax Return (SPT) for the year 2015 to the Tax Office.
A reconciliation between profit before tax expense as presented in the interim onsolidated statements of
profit (loss) and other comprehensive income with the total consolidated tax expense is as follows:
Permanent Differences:
Deferred Charge 7,835,002,668 7,841,058,928
Salary and Employees Benefits 2,816,557,506 227,923,651
Entertainment and Donation 866,978,851 844,369,114
Income Already Subjected to Final Tax (9,078,080,133) (9,807,222,923) Interest Income already Subjected to Final Tax (1,881,872,852) (2,412,524,648) Others 1,746,987,654
--2,305,573,694 (3,306,395,878)
Estimated Taxable Income 109,484,513,765 59,984,136,091
Estimated Current Taxes - the Company 27,371,128,000 14,996,034,000
Less: Prepayments of Income Tax Article 25 (17,166,734,547) (16,130,261,975)
Estimated Corporate Tax Payable (Prepaid tax article 28) 10,204,393,453 (1,134,227,975)
2015 2014
(9 Months) (9 Months)
Rp Rp
Profit before Tax as Presented in the Consolidated
Statements of Comprehensive Income - Interim 103,041,491,850 64,325,207,064
Less: Loss before Tax of Subsidiaries 12,424,599,316 7,105,453,767
Profit before Tax of the Company 90,616,892,534 57,219,753,297
Current Prevailing Tax Rate 25% 22,654,223,134 14,304,938,324
Deferred Charge 1,958,750,667 7,841,058,928
Salary and Employees Benefits 704,139,377 56,980,913
Entertainment and Donation 216,744,713 211,092,279
Income Already Subjected to Final Tax (2,269,520,033) (2,451,805,731) Interest Income already Subjected to Final Tax (470,468,213) (603,131,162)
Correction and Recovery of Deferred Tax -- (6,940,320,364)
Others 436,746,472 --
Total Tax Expenses of the Company 23,230,616,116 12,418,813,187
Current Tax Expenses - Subsidiaries 10,349,600,308
--Deferred Tax Benefit - Subsidiaries 1,855,918,403 596,703,069
d. Deferred Tax
Management believes that the deferred tax asset can be recovered through taxable income in the future.
8. Prepaid Expenses
Prepaid rent mainly relates to the lease of the land and building of Siloam Hospitals Lippo Cikarang from PT Graha Pilar Sejahtera and lease of Siloam Cinere Hospital to PT Anadi Sarana Tatahusada (see Note 36.a
December 31, 2014 Charged Deferred Tax September 30, 2015 (Credited) to Liabilities
Employee Benefits 24,134,255,867 1,204,237,071 -- 25,338,492,938 Depreciation of Property and Equipment (9,826,303,651) 2,936,274,813 -- (6,890,028,838) Allowance for Impairment Losses 1,319,623,187 -- -- 1,319,623,187
15,627,575,403
4,140,511,884 -- 19,768,087,287
Subsidiaries 6,815,346,927 (2,086,580,473) -- 4,728,766,454
Total Deferred Tax Assets 22,442,922,330 2,053,931,411 -- 24,496,853,741
Deferred Tax Liability - Subsidiaries (28,147,868,966) 21,450,395,690 (21,219,733,619) (27,917,206,895)
) and the lease of land PT Buana Utama Sejati to I Wayan Buana Partha and I Nyoman Ada.
December 31, 2013 Charged Deferred Tax December 31, 2014 (Credited) to Liabilities
Employee Benefits 19,317,307,583 4,816,948,284 -- 24,134,255,867 Depreciation of Property and Equipment (5,949,384,660) (3,876,918,991) -- (9,826,303,651) Allowance for Impairment Losses 1,056,097,167 263,526,020 -- 1,319,623,187
14,424,020,090
1,203,555,313 -- 15,627,575,403
Subsidiaries 4,557,581,123 2,257,765,804 -- 6,815,346,927
Total Deferred Tax Assets 18,981,601,213 3,461,321,117 -- 22,442,922,330
Deferred Tax Liability - Subsidiaries (11,983,104,371) (1,530,675,892) (14,634,088,703) (28,147,868,966)
September 30, 2015 December 31, 2014
Rp Rp
Rental 50,474,038,328 36,073,984,961
Advertising 2,589,490,390 3,543,804,853
Insurance 8,645,796,160 2,463,613,449
Others (below Rp500 million each) 29,216,743,387 3,826,344,612
9. Advances
Advances for purchase of property and equipment mainly represent the purchase of medical equipment for Siloam Hospitals Lippo Village, Siloam Hospitals Kebun Jeruk, Rumah Sakit Umum Siloam, Siloam Hospitals Palembang, Siloam Hospitals Surabaya, Siloam Hospitals TB Simatupang, Siloam Hospitals MRCCC and Siloam Hospitals Kupang.
Advances for construction represent downpayment to suppliers related to the hospitals renovation.
10. Transactions with Related Parties
In its normal business transactions, the Company conducts business transactions with related parties as follows:
September 30, 2015 December 31, 2014
Rp Rp
Advances for Purchase of Property and Equipment 96,130,982,264 52,507,590,784
Construction 19,248,533,078 17,892,758,610
Others (below Rp500 million each) 17,118,257,818 14,224,115,574
Total 132,497,773,160 84,624,464,968
September 30, 2015 31 Desember, 2014 September 30, 2015 December 31, 2014
Rp Rp % %
Cash and Cash Equivalent
PT Bank Nationalnobu Tbk 41,140,036,855 28,610,235,853 1.37 1.01 Trade Receivables
Non-employee 8,825,123,799 3,549,747,601 0.29 0.12 Due from Related Parties Non-Trade
Other (below Rp1 billion each) 34,291,027,372 1,341,961,213 1.14 0.05 Percentage to Total Assets/Liabilities
Accrued Expense
PT Lippo Karawaci Tbk 133,523,386,395 72,685,845,080 10.19 6.11
September 30, 2015 31 Desember, 2014 September 30, 2015 December 31, 2014
Rp Rp % %
Due to Related Parties Non-Trade
PT Lippo Karawaci Tbk 416,294,437,537 415,006,106,981 31.73 34.86 Other (below Rp1 billion each) 197,506,875 807,561,568 0.00 0.00
Total 416,491,944,412 415,813,668,549 31.73 34.86
