Long Term Investment &

Other Assets
Akuntansi Perpajakan

28/03/2016

Investment
Investing activity through certain

participation
Such as:
1.Stock
2.Obligation
3.Other securities
4.Fund

28/03/2016

Investment Accounting
Approaches
Type of
Assessment
Valuation
Investment
Debt

Intends to hold to Amortized Cost

maturity and
payment dates
for interest and
principal are
stated
Intends to
speculate on
interest rate
changes

Equity
3

Fair Value

Does not have a

Fair Value
fixed interest or
principal payment

28/03/2016

Investment in stock
strategies
20%
Zero
Ownership Ownership

Earn
dividend
income
ii. Make
capital
gain

100%
Ownership

Active
Investment

Passive
Investment
i.

50%
Ownership

i.

Exert
significant
influence or
control over
investees
operation

Active
Investment
i.

Achieve
synergistic
benefits
ii. Gain market
dominance /
control

28/03/2016

Reporting Stock Investments

Category

Valuatio
n

Unrealized
Holding Gains
or Losses

Other Income
Effects

Fair Value

Recognized in
net income

Dividends declared;
gains and losses from
sale

2.Non-Trading
Fair Value
(cause of regulation)

Recognized in
Other
comprehensive
income and as
separate
component of
equity

Dividends declared;
gains and losses from
sale

Holdings between
20%-50%
5

Not recognized

Proportionate share
28/03/2016
of investees
net
income

Holdings less than

20%
1.Trading

Equity

Stock Investment (Part of

Income)

On 20 November 2015, Hindmarsh (PKP)

purchased ordinary shares of three

companies and each investment
representing less than a 20 percent interest
with brokerage fee of Rp 2.000.000 to the
Bahamas Securities. Cost (in Thousand
Rupiahs)

Telkom (TLKM)

259.700

Aneka Tambang (ANTM)

317.500

Astra Internasional (ASII)

141.350
718.550

28/03/2016

Records Investments
Equity Investment

718.550.000
Brokerage Expense
2.000.000
Cash
Income Tax Art 23
Cash

718.550.000
40.000
1.960.000

28/03/2016

Cash Dividend
20 December 2015, Hindmarsh (PKP)

receives a cash dividen of Rp 4.200.000 on

investment in ANTM
Cash

3.570.000
Prepaid tax 23 630.000
Dividend revenue

4.200.000

28/03/2016

Unrealized Holding Gain or

Loss
In thousand
rupiahs

Carrying Value

Fair Value

Unrealized
Gain/Loss

Telkom (TLKM)

259.700

275.000

15.300

Aneka Tambang
(ANTM)

317.500

304.000

(13.500)

Astra
Internasional
(ASII)

141.350

104.000

(37.500)

Total of portfolio

718.550

683.000

(35.550)

Previous
securities fair
value
adjustment

Securities fair
9 value
adjustment

(35.550)
28/03/2016

Records Unrealized Holding

Unrealized holding Gain or Loss 35.550
Securities Fair Value Adjustment

35.550

Unrealized holding gain or loss classify as

other income and expense

10

28/03/2016

Sale on Stock (on the floor)

25 January 2016, Hindmarsh sold all of TLKM

shares with carrying value of Rp

259.700.000,receiving Rp 287.220.000 in
secondary market stock exchange. Levy or
transaction cost was 0,03% and income tax article
4 ver 2 was 0,1%
Cash
286.846.614
Inc tax Art 4(2)
287.220
Transaction Exp
86.166
Equity investment 259.700.000
Gain on Sale of equity investment

27.520.000

In IPO, extra Income tax article 4 ver 2 is 0,5%

11

28/03/2016

Sale on Stock (Over The

Counter)

On 1 November 2015, Hindmarsh (PKP) sold

Dynaplast shares with carrying value of Rp

259.700.000,receiving Rp 287.220.000 over the
counter to Norwood. Legal cost was Rp
2.000.000 paid to Trustee Notary&Attorney Firm.
Cash
Rp287.220.000
Legal expense Rp
2.000.000
Equity investment Rp 259.700.000
Gain on sale of equity investment

27.520.000
Income Tax Art 23 Rp
Cash
Rp
1.960.000
12

Rp

40.000

28/03/2016

Sale on Stock (Foreign

Investor)

On 1 November 2015, Murray Ltd sold Dynaplast

shares with carrying value of Rp

259.700.000,receiving Rp 287.220.000 over the
counter to Norwood. Legal cost was Rp 2.000.000
paid to Trustee Notary&Attorney Firm.
Cash
Rp272.859.000
Income Tax Art 26 Rp 14.361.000 (Tax Expense)
Legal expense Rp
2.000.000
Equity investment Rp 259.700.000
Gain on sale of equity investment

27.520.000
Cash
Rp
13

Rp

2.000.000
28/03/2016

Investment in share of 20% or

more
On 2 January 2016, Hindmarsh (PKP) acquired

48.000 shares (20% of Moseley shares) at a

cost of Rp 10.000 a share. Legal cost was Rp
2.000.000 paid to Trustee Notary&Attorney
Firm.
Equity investment
Legal expense Rp

Rp 480.000.000
2.000.000

Cash

Rp 480.000.000
Income Tax Art 23 Rp
Cash
Rp
1.960.000
14

40.000

28/03/2016

Subsidiary-Income
On 31 December 2015,Moseley reported

net income of Rp 200.000.000 and

Hindmarshs share is 20% or Rp 40.000.000
(negative fiscal correction)
Equity Investments
Revenue from Investment

Rp 40.000.000
Rp

40.000.000

15

28/03/2016

Cash Dividend
On 20 january 2016,Moseley paid a cash

dividend of Rp 100.000.000 and Hindmarsh

received 20%, or Rp 20.000.000
Cash
Prepaid Tax Art 23
Equity Investment

16

Rp 17.000.000
Rp 3.000.000 (15%)
Rp 20.000.000

28/03/2016

Cash Dividend (25% or more

shares)
On 20 january 2016,Moseley paid a cash

dividend of Rp 100.000.000 and Currie

received 25%, or Rp 25.000.000
Cash

Rp 25.000.000

Equity Investment

17

Rp 25.000.000

28/03/2016

Debt Investment (carrying

amount)
PV of principle = S (1+r)-n
PV of annuity
Proceed yield

= R (1-(1+r) -n ) /r
= PV of principle + PV of

annuity
R = bond rate x par value of bond
R = market rate

18

28/03/2016

Carrying Amount
Hindmarsh purchased Rp 100.000.000 of

8% bonds of Moseley on 1 January 2015, at

a discount with maturity date 1 January
2020 when market rate 10%. Interest is
payable each July 1 and January 1.
PV Principle = 100.000.000 (1+0,05) -10
=61.391.325
PV Annuity= (4.000.000(1-(1+0,05)
-10)/0,05=30.886.940
Proceed yield
=92.278.265
19

28/03/2016

Record Carrying Amount

Debt Investments
Cash

20

Rp 92.278.265
Rp 92.278.265

28/03/2016

Amortize discount (effective interest

method)
Date

Cash
Received
(8%)

Interest
Revenue
(10%)

Bond
Carrying
Discount
Amount of
Amortization Bonds

1/1/14
1/7/14

Rp 4.613.913
(b)

Rp 613.913
(c)

Rp 92.892.178
(d)

Rp
Rp 4.644.609
4.000.000
Rp 100.000.000 x 8% x 6/12
Rp 92.278.265 x 10% x 6/12
Rp 4.613.913 Rp 4.000.000
Rp 92.278.265 + Rp 613.913

Rp 644.609

Rp 93.536.787

1/1/15
a.
b.
c.
d.

21

Rp 92.278.265
Rp
4.000.000 (a)

28/03/2016

Interest payment on 1 July

2015
Cash

Rp 3.400.000
Income tax Article 4 ver 2
Rp
(15%)
Debt Investment
Rp 613.913
Interest Revenue

600.000

Rp 4.613.913

Cash

Rp 3.307.913
Income tax Article 4 ver 2
Rp
(15%)
Debt Investment
Rp 613.913
Interest Revenue
22

692.087

Rp 4.613.913
28/03/2016

Accrue interest at 31 Dec

2015
Interest Receivable

Income tax art 4 ver 2

Debt investment
Interest Revenue

Interest Receivable
Income tax art 4 ver 2
Debt investment
Interest Revenue

23

Rp 3.400.000
Rp 600.000
Rp 644.609
Rp 4.644.609

Rp 3.303.309
Rp 696.691
Rp 644.609
Rp 4.644.609

28/03/2016

Sale of the bonds

On 1 January 2016, Hindmarsh sold the

bond at 99 to Highgate
Cash
Rp 3.400.000/ Rp 3.303.309
Interest Receivable Rp

3.400.000/ Rp

3.303.309
Worksheet Calculation:
Selling price

Rp 99.000.000
Less: BV on 1 Jan 2016:
Amortized cost

(Rp 93.536.787)

Gain on sale of bonds

24

Rp 5.463.213
28/03/2016

Record the sale of the bonds

Cash

Rp 99.000.000

Debt Investment

Rp

93.536.787
Gain on Sale of Debt Investment
5.463.213

25

Rp

28/03/2016

Debt investment- Fair Value

Hindmarsh determines that, fair value of

the debt investment on 31 December 2015

at Rp 95.000.000
Worksheet calculation:
Fair Value (31 Dec 2015)
Rp
95.000.000
Amortized cost (31 Dec 2015) Rp
93.536.787
Unrealized holding gain or loss Rp
1.463.213
26

28/03/2016

Review
On 2 January 2016, Norwood is foreign

investor sold Moseleys stock at Rp

100.000.000 (25% share) to Ipswich. Legal
cost was Rp 2.000.000 paid to Mark
Notary&Attorney Firm by Norwood. Prepare
the journal entry from the Norwood

27

28/03/2016