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RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2023

31. RELATED PARTY TRANSACTIONS

a. Nature of relationships and accounts/transactions with related parties

Details of the nature of relationships and accounts/transactions with significant related parties are as follows:


Related parties	Nature of relationships	Nature of accounts/ transactions
The Government Ministry of Finance	Majority stockholder	Internet and data service revenues, other telecommunication service revenues, finance income, finance costs, and investment in financial instruments
Government agencies	Entities under common control	Network service revenues, internet and data service revenues, other telecommunication revenues, life insurance expenses, press release expenses, customer education expenses, office building lease expenses, consultant expenses, training expenses, finance income, and purchase of property and equipments
MoCI	Entity under common control	Concession fees, radio frequency usage charges, USO charges, telecommunication service revenues, and license expenses
State-owned enterprises
Indosat	Entity under common control	Interconnection revenues, leased lines revenues, satellite transponder usage revenues, interconnection expenses, telecommunication facilities usage expenses, operating and maintenance expenses, and usage of data communication network system expenses
PT Pertamina (Persero) (“Pertamina”)	Entity under common control	Internet and data service revenues and other telecommunication service revenues
State-owned banks	Entities under common control	Finance income and finance costs
Bank Mandiri	Entity under common control	Internet and data service revenues, other telecommunication service revenues, finance income, finance costs, cash in bank, time deposits, loan, and consultant expenses
BNI	Entity under common control	Internet and data service revenues, other telecommunication service revenues, finance income, finance costs, cash in bank, time deposits, loan, consultant expenses, and financing
BRI	Entity under common control	Internet and data service revenues, other telecommunication service revenues, finance income, finance costs, cash in bank, time deposits, and loan
PT Taspen (Persero) (“Taspen”)	Entity under common control	Internet and data service revenues and other telecommunication service revenues
PT Perusahaan Listrik Negara (“PLN”)	Entity under common control	Internet and data service revenues, other telecommunication service revenues, and electrical utility expenses


Related parties	Nature of relationships	Nature of accounts/ transactions
PT Asuransi Jasa Indonesia (“Jasindo”)	Entity under common control	Property and equipment insurance expenses and personal insurance expenses
PT BNI Life Insurance (“BNI Life Insurance”)	Entity under common control	Medical expenses
Bahana TCW	Entity under common control	Mutual funds
Sarana Multi Infrastruktur	Entity under common control	Other borrowings and finance costs
BTN	Entity under common control	Cash in bank and time deposits
BSI	Entity under common control	Cash in bank, time deposits, and loan
PT Omni Inovasi Indonesia Tbk. (“Omni Inovasi Indonesia”)	Associated company	Distribution of SIM cards and pulse reload voucher
PT Fintek Karya Nusantara (“Finarya”)	Associated company	Marketing expenses and distribution of SIM cards and pulse reload voucher
Indonusa	Associated company	Internet and data service revenues and other telecommunication service revenues
PT Kereta Cepat Indonesia China (“KCIC”)	Other related entity	Other telecommunication service revenues
Padi UMKM	Other related entity	Operational and maintenance expenses, collection fees, training expenses, internal security expenses, research and development expenses, printing expenses, meeting expenses, general and other administrative expenses, promotion expenses, advertising expenses, sales fees, customer education expenses, and marketing expenses
Directors	Key management personnel	Honorarium and facilities
Commissioners	Supervisory personnel	Honorarium and facilities

The outstanding balances of trade receivables and payables as of December 31, 2022 and 2023 are unsecured and interest-free and the settlement is expected to occur in cash. There have been no guarantees provided or received for any related party receivables or payables. The Group recorded a decrease in impairment loss from trade receivables of related party amounted to Rp152 billion, Rp33 billion, and Rp91 billion for the years ended December 31, 2021, 2022, and 2023, respectively.

b.Significant transactions with related parties

The following are significant transactions with related parties:


	2021		2022		2023
		% of total		% of total		% of total
	Amount	revenues	Amount	revenues	Amount	revenues
Revenues
Majority stockholder
Ministry of Finance	212	0.15	199	0.14	174	0.12
Entities under common control
Government agencies	5,598	3.91	3,029	2.06	3,235	2.17
Indosat	1,056	0.74	1,923	1.31	2,195	1.47
Pertamina	631	0.44	752	0.51	755	0.51
MoCI	284	0.20	791	0.54	516	0.35
BNI	404	0.28	493	0.33	509	0.34
BRI	341	0.24	104	0.07	190	0.13
Bank Mandiri	212	0.15	180	0.12	156	0.10
Taspen	53	0.04	56	0.04	106	0.07
Others (each below Rp100 billion)	1,495	1.04	1,370	0.94	900	0.60
Sub-total	10,074	7.04	8,698	5.92	8,562	5.74
Associated companies	16	0.01	6	0.00	8	0.01
Other related entities	33	0.02	52	0.04	130	0.09
Total	10,335	7.22	8,955	6.10	8,874	5.96


	2021		2022		2023
		% of total		% of total		% of total
	Amount	expenses	Amount	expenses	Amount	expenses
Expenses

Entities under common control
MoCI	8,570	8.64	9,965	9.82	10,300	9.88
PLN	2,349	2.37	2,473	2.44	2,602	2.50
Indosat	467	0.47	537	0.53	566	0.54
Jasindo	385	0.39	296	0.29	198	0.19
Government agencies	114	0.11	179	0.18	144	0.14
BNI Life Insurance	—	—	—	—	143	0.14
Bank Mandiri	8	0.01	—	—	109	0.10
Others (each below Rp100 billion)	200	0.20	229	0.23	272	0.26
Sub-total	12,093	12.19	13,679	13.49	14,334	13.75
Associated companies
Finarya	125	0.13	110	0.11	126	0.12
Others (each below Rp100 billion)	344	0.35	37	0.04	0	0.00
Sub-total	469	0.48	147	0.15	126	0.12
Other related entities
Padi UMKM	269	0.27	626	0.62	561	0.54
Others (each below Rp100 billion)	115	0.12	98	0.10	94	0.09
Sub-total	384	0.39	724	0.72	655	0.63
Total	12,946	13.06	14,550	14.36	15,115	14.50

2021

2022

2023

% of total

Amount

finance income

Amount

finance income

Amount

finance income

Finance income

Entities under common control

State-owned banks

348

62.37

459

52.28

312

29.41

Government agencies

2.51

1.82

5.28

Total

362

64.88

475

54.10

368

34.69


	2021		2022		2023
		% of total		% of total		% of total
	Amount	finance cost	Amount	finance cost	Amount	finance cost
Finance cost
Majority stockholder
Ministry of Finance	17	0.39	10	0.25	5	0.11
Entities under common control
State-owned banks	1,247	28.38	1,004	24.63	1,111	23.68
Sarana Multi Infrastruktur	192	4.37	109	2.67	74	1.58
Sub-total	1,439	32.75	1,113	27.30	1,185	25.26
Total	1,456	33.14	1,123	27.55	1,190	25.37

2021

2022

2023

% of total

Amount

revenues

Amount

revenues

Amount

revenue

Distribution of SIM card and voucher

Associated companies

Omni Inovasi Indonesia

959

0.67

981

0.67

467

0.31

Finarya

—

141

0.10

159

0.11

Total

959

0.67

1,122

0.77

626

0.42


	2022		2023
		% of total		% of total
	Amount	property and equipment purchased	Amount	property and equipment purchased
Purchase of property and equipment
Entities under common control	122	0.35	64	0.19
Total	122	0.35	64	0.19

c. Balance of accounts with related parties


	2022		2023
		% of total		% of total
	Amount	assets	Amount	assets
Cash and cash equivalents (Note 4)	24,902	9.06	22,173	7.74
Other current financial assets (Note 5)	400	0.15	800	0.28
Trade receivables (Note 6)	2,009	0.73	2,357	0.82
Contract assets
Majority stockholder
Ministry of Finance	24	0.01	36	0.01
Entities under common control
Government agencies	295	0.11	293	0.10
Others (each below Rp100 billion)	273	0.10	288	0.10
Sub-total	568	0.21	581	0.20
Associated companies	1	0.00	1	0.00
Other related entities	1	0.00	1	0.00
Total	594	0.22	619	0.21
Other current assets
Entities under common control
MoCI	5,093	1.85	5,971	2.08
Others	96	0.03	35	0.01
Sub-total	5,189	1.88	6,006	2.09
Associated companies	2	0.00	2	0.00
Other related entities	—	—	16	0.01
Total	5,191	1.88	6,024	2.10
Other non-current assets
Entities under common control
MoCI	1,291	0.47	1,987	0.69
Others	16	0.01	6	0.00
Total	1,307	0.48	1,993	0.69


	2022		2023
		% of total		% of total
	Amount	liabilities	Amount	liabilities
Trade payables (Note 16)
Majority stockholder
Ministry of Finance	0	0.00	17	0.01
Entities under common control
MoCI	1,342	1.07	2,400	1.84
Indosat	140	0.11	129	0.10
BNI	85	0.07	120	0.09
Bank Mandiri	14	0.01	105	0.08
Others (each below Rp100 billion)	138	0.11	95	0.07
Sub-total	1,719	1.37	2,849	2.18
Associated companies	13	0.01	40	0.03
Other related entities	43	0.03	84	0.06
Total	1,775	1.41	2,990	2.28

Accrued expenses
Majority stockholder
Ministry of Finance	1	0.00	1	0.00
Entities under common control
PLN	57	0.05	100	0.08
Others	76	0.06	76	0.06
Sub-total	133	0.11	176	0.14
Total	134	0.11	177	0.14


	2022		2023
		% of total		% of total
	Amount	liabilities	Amount	liabilities
Contract liabilities
Majority stockholder
Ministry of Finance	34	0.03	18	0.01
Entities under common control
Government agencies	328	0.26	498	0.38
MoCI	62	0.05	137	0.11
Others (each below Rp100 billion)	171	0.14	313	0.24
Sub-total	561	0.45	948	0.73
Associated companies	2	0.00	14	0.01
Other related entities
KCIC	—	—	1,133	0.87
Others	3	0.00	2	0.00
Sub-total	3	0.00	1,135	0.87
Total	600	0.48	2,115	1.62

Short-term bank loans (Note 19a)	4,462	3.55	4,916	3.77
Two-step loans (Note 20a)	209	0.17	84	0.06
Long-term bank loans (Note 20c)	11,284	8.97	11,099	8.51
Other borrowings (Note 20d)	1,314	1.04	362	0.28

d. Significant agreements with related parties

i. The Government

The Company obtained two-step loans from the Government (Note 20a).

ii. Indosat

The Company has an agreement with Indosat to provide international telecommunication services to the public.

The Company has also entered into an interconnection agreement between the Company’s fixed line network (Public Switched Telephone Network or “PSTN”) and Indosat’s Global System for Mobile ("GSM”) cellular telecommunication network in connection with the implementation of Indosat Multimedia Mobile services and the settlement of related interconnection rights and obligations.

The Company also has an agreement with Indosat for the interconnection of Indosat's GSM mobile cellular telecommunication network with the Company's PSTN, which enable each party’s customers to make domestic calls between Indosat’s GSM mobile network and the Company’s fixed line network, as well as enabling Indosat’s mobile customers to access the Company’s International Direct Dialing (“IDD”) service by dialing “007”.

The Company has been handling customer billings and collections for Indosat. Indosat is gradually taking over the activities and performing its own direct billing and collection. The Company has received compensation from Indosat computed at 1% of the collections made by the Company starting from January 1, 1995, as well as the billing process expenses which are fixed at a certain amount per record. On December 11, 2008, the Company and Indosat agreed to implement IDD service charge tariff which already took into account the compensation for billing and collection. The agreement is valid and effective starting from January to December 2012, and is subsequently applicable up until a new agreement becomes available.

On December 18, 2017, the Company and Indosat signed amendments to the interconnection agreements for the fixed line networks (local, Sambungan Langsung Jarak Jauh (“SLJJ”), and international) and mobile network for the implementation of cost-based tariff obligations under MoCI Regulation No. 8/Year 2006. These amendments took effect starting from January 1, 2018.

Telkomsel also entered into an agreement with Indosat for the provision of international telecommunication services to its GSM mobile cellular customers.

The Company also provides leased lines to Indosat and its subsidiaries, namely PT Aplikanusa Lintasarta ("Lintasarta"). The leased lines can be used by these companies for telephone, telegraph, data, telex, facsimile, or other telecommunication services.

iii. Others

The Company entered into an agreement with Lintasarta for the use of satellite transponders or the Company's subscribed circuit telecommunication satellite frequency channels.

e. Remuneration of key management and supervisory personnel

Key management personnel consists of the Directors of the Company and supervisory personnel consists of the Board of Commissioners.

The Company provides remuneration in the form of salaries/honorarium and facilities to support the governance and oversight duties of the Board of Commissioners along with the leadership and management duties of the Directors. Total of such remuneration is as follows:


	2021		2022		2023
		% of total		% of total		% of total
	Amount	expenses	Amount	expenses	Amount	expenses
Board of Directors	347	0.35	401	0.39	475	0.46
Board of Commissioners	140	0.14	164	0.16	179	0.17

The amounts disclosed in the table are amounts recognized as general and administration expense during the reporting periods.