IFRS APPLICATION AROUND THE WORLD JURISDICTIONAL PROFILE: Indonesia

Disclaimer: The information in this Profile is for general guidance only and may change from time to time. You should not act on the information in this Profile, and you should obtain specific professional advice to help you in making any decisions or in taking any action. If you believe that the information has changed or is incorrect, please contact us at ifrsapplication@ifrs.org. This Profile has been prepared by the IFRS Foundation based on information from various sources. The starting point was the answers provided by standard-setting and other relevant bodies in response to a survey that the Foundation conducted on the application of IFRSs around the world between August and December 2012. The Foundation drafted the profile and invited the respondents to the survey and others (including regulators and international audit firms) to review the drafts, and their comments are reflected. Profile last updated 5 June 2013

PARTICIPANT IN THE IFRS FOUNDATION SURVEY ON APPLICATION OF IFRSs

Organisation Role of the organisation Ikatan Akuntan Indonesia (IAI) [The Indonesian Institute of Accountants] The IAI is the accounting professional body in Indonesia and is recognised by the Government. Dewan Standar Akuntansi Keuangan (DSAK) [The Indonesian Financial Accounting Standard Board] is the accounting standard setter established within the IAI. DSAK is financially supported by IAI, and the members of DSAK are appointed by the IAIs national council. Website Email contact http://www.iaiglobal.or.id/ dsak@iaiglobal.or.id (cc aucky.patrama@iaiglobal.or.id)

COMMITMENT TO GLOBAL FINANCIAL REPORTING STANDARDS

Has the jurisdiction made a public commitment in support of moving towards a single set of high quality global accounting standards? Has the jurisdiction made a public commitment towards IFRSs as that single set of high quality global accounting standards? What is the jurisdiction's status of adoption? Yes.

Yes.

Indonesia has not adopted IFRSs.

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Additional comments provided on the adoption status?

Indonesias stated policy is to maintain its national GAAP and converge it gradually with IFRSs as much as possible. Indonesia does not have a plan or timetable for full adoption of IFRSs. The general approach taken by Indonesia with regard to the IFRS convergence process is to gradually converge the local standards with IFRSs, starting with minimising the significant differences between the two. As of 1 January 2012, the local standards applied in Indonesia (called Indonesian Financial Accounting Standards) are based on IFRSs that were effective at 1 January 2009 with some modifications. The next step would be to continue with the convergence process, in particular: consideration of recent amendments; analysis of the relatively new standards, such as IFRSs 9 to 13 and consider whether to adopt them; and analysis of recent IFRS exposure drafts.

Indonesia intends to analyse the readiness of industry and other constituents in implementing the first wave of standards resulting from the convergence process before developing the next wave of new standards. Indonesia aims to provide a sufficient transitional period of three to four years for new standards while minimising any gaps between the effective dates of new IFRSs and new Indonesian standards. If the jurisdiction has NOT made a public statement supporting the move towards a single set of accounting standards and/or towards IFRSs as that set of standards, explain the jurisdiction's general position towards the adoption of IFRSs in your jurisdiction. Not applicable.

EXTENT OF IFRS APPLICATION

For DOMESTIC companies whose debt or equity securities trade in a public market in the jurisdiction: Are all or some domestic companies whose securities trade in a public market either required or permitted to use IFRSs in their consolidated financial statements? If YES, are IFRSs REQUIRED or PERMITTED? Does that apply to ALL domestic companies whose securities trade in a public market, or only SOME? If some, which ones? Are IFRSs also required or permitted for more than the consolidated financial statements of companies whose securities trade in a public market? For instance, are IFRSs required or permitted in separate company financial statements of companies whose securities trade in a public market? For instance, are IFRSs required or permitted for companies whose securities do not trade in a public market? No.

Not applicable. Not applicable.

No.

No.

No.

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If the jurisdiction currently does NOT require or permit the use of IFRSs for domestic companies whose securities trade in a public market, are there any plans to permit or require IFRSs for such companies in the future?

Indonesias stated commitment is to converge the Indonesian Financial Accounting Standards with IFRSs and minimise the significant differences between the two sets of standards. A commitment towards the full use of IFRSs for domestic companies has not been announced. The Indonesian Capital Market Supervisory Agency that regulates listed entities has revised its rules on financial statement presentation and disclosures to conform to Indonesian Financial Accounting Standards, which had been converged with IFRSs that were effective 1 January 2009 with some modifications.

For FOREIGN companies whose debt or equity securities trade in a public market in the jurisdiction: Are all or some foreign companies whose securities trade in a public market either REQUIRED or PERMITTED to use IFRSs in their consolidated financial statements? If YES, are IFRSs REQUIRED or PERMITTED in such cases? Does that apply to ALL foreign companies whose securities trade in a public market, or only SOME? If some, which ones? No. They must use Indonesian Financial Accounting Standards.

Not applicable. Not applicable.

IFRS ENDORSEMENT
Which IFRSs are required or permitted for domestic companies? The auditor's report and/or the basis of presentation footnotes states that financial statements have been prepared in conformity with: Does the auditor's report and/or the basis of preparation footnote allow for dual reporting (conformity with both IFRSs and the jurisdictions GAAP)? Are IFRSs incorporated into law or regulations? If yes, how does that process work? If no, how do IFRSs become a requirement in the jurisdiction? Does the jurisdiction have a formal process for the 'endorsement' or 'adoption' of new or amended IFRSs (including Interpretations) in place Not applicable.

Indonesian Financial Accounting Standards.

No.

No. Not applicable. The requirement is to use Indonesian Financial Accounting Standards.

Indonesia does not have a process for endorsing IFRSs. However, DSAK IAI as the national standard setting body has established a due process for gradually converging the Indonesian Financial Accounting Standards with IFRSs.

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If yes, what is the process?

The due process involves, among other things, an analysis prepared by the Board and its staff, and includes interactions with stakeholders in Indonesia to capture comments from regulators, the business community, and related institutions. The standard-setting process in Indonesia has the support of relevant regulators, who entrust the Board with the task of issuing Indonesian Financial Accounting Standards that minimise significant differences with IFRSs. The regulators and the government have established an IFRS Task Force, consisting of representatives from, among others, the profession (The Indonesian Institute of Accountants and Indonesian Institute of Certified Public Accountants), regulators (including the Capital Market and Financial Institutions Supervisory Agency and Ministry of Finance whose functions were assumed by the Financial Services Authority (OJK) starting 31 December 2012, the Central Bank of Indonesia whose function will be assumed by OJK starting 31 December 2013, the Ministry of State Owned Enterprises, and the Tax Authority).

If no, how do new or amended IFRSs become a requirement in the jurisdiction? Has the jurisdiction eliminated any accounting policy options permitted by IFRSs and/or made any modifications to any IFRSs? If yes, what are the changes? Other comments regarding the use of IFRSs in the jurisdiction?

Not applicable.

Not applicable. It should be noted, however, that those Indonesian Financial Accounting Standards that were converged with IFRSs effective 1 January 2009 included some modifications to IFRSs.

Not applicable. None.

TRANSLATION OF IFRSs
Are IFRSs translated into the local language? No. It should be noted that Indonesian Financial Accounting Standards, which have been partially converged with IFRSs, are in Bahasa Indonesia (the local language). Not applicable.

If they are translated, what is the translation process? In particular, does this process ensure an ongoing translation of the latest updates to IFRSs?

APPLICATION OF THE IFRS FOR SMEs

Has the jurisdiction adopted the IFRSs for SMEs for at least some SMEs? If no, is the adoption of the IFRS for SMEs under consideration? Did the jurisdiction make any modifications to the IFRS for SMEs? If the jurisdiction has made any modifications, what are those modifications? Which SMEs use the IFRS for SMEs in the jurisdiction, and are they required or permitted to do so? No. No.

Not applicable Not applicable

Not applicable

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For those SMEs that are not required to use the IFRS for SMEs, what other accounting framework do they use? Other comments regarding use of the IFRS for SMEs?

Indonesian Financial Accounting Standard for Entities without Public Accountability.

None.

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