Table of Contents

CHAPTER I (Introduction) .................................................................................................... 1

CHAPTER II (Financial Report) ........................................................................................... 5
CHAPTER III (Calculation Fiscal Reconciliation) .............................................................. 9
CHAPTER IV (Analysis) ..................................................................................................... 15
CHAPTER V (Conclution).................................................................................................... 23

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 1

 INTRODUCTION

Fiscal correction aims to adjust commercial profit (i.e. profits calculated according to
the General Applicable Accounting Principles) with taxation provisions in order to obtain
fiscal profit. The Profit-Loss Calculation Report made by the company is a financial report
prepared based on General Accounting Principles. Therefore in order to be able to calculate
the amount of income tax owed, the company must make adjustments to the profit-loss
calculation report so that it complies with the provisions and regulations of the tax law. This
adjustment step is done by looking for account posts that are different treatments between
generally accepted accounting principles and the provisions of the tax law. These account
posts need fiscal correction.

The differences are as follows:

a. Permanent Difference.
Namely income and costs recognized in the calculation of net income for commercial
accounting but not recognized in the calculation of tax accounting.
b. Temporary Difference
Namely the income and costs that can be recognized today by commercial accounting
or vice versa, but cannot be recognized at once by tax accounting, usually because of
differences in recognition methods.

1. The emergence of Fiscal Corrections

Matters that make a difference between the Accounting Principles Applicable General
and the Taxation Law include:
a. Difference in Income Concepts
b. Differences in How to Measure Income
c. Difference in Cost Concept
Expenditures that can be charged as costs are all economic sacrifices in order to obtain
goods and services. Not limited to just the cost of obtaining, collecting and maintaining
income only. In short, tax-based costs are expenditures that have a direct relation to
income generation
d. Difference in Cost Measurement Method
Same as how to measure income, if there are transactions that are not fair because of a
special relationship, the transaction must be corrected.

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 2

 e. Difference in the Method of Loading or Cost Allocation
f. Income is subject to final income tax.
Income that is taxed in a final manner means that the income tax has been calculated so
that it does not need to be taken into account again in calculating income tax at the end of
the year so it must be excluded from the profit-loss calculation report

2. Types of Fiscal Corrections

a. Positive Fiscal Correction
Positive Fiscal Correction is a fiscal correction that increases the amount of taxable
profit.
b. Negative Fiscal Correction
Negative Fiscal Correction is a fiscal correction that reduces taxable income

In this report, we will analyze the fiscal reconciliation for the income statement of PT
Sari Guna Primatirta Tbk for the year ended December 31, 2017. Financial report
downloaded from IDX’s database for public company financial report.

The Company is established since 1988 with the name of PT Sari Guna, and in 1989,
the Company had its name changed into PT Sariguna Primatirta until today. The Company is
part of Tanobel Food business group who produces food and beverages such as drinking
water, biscuits and powder drink. Main business activity of the Company is producer of
Bottled-Drinking Water (AMDK). The company’s vission is to be a leading national
beverage companies in Indonesia. Then the mission is To produce beverage products with
high quality, innovative, and easily obtained through the internationally certified production
process and integrated manufacturing network all over Indonesia.

The Company started commercial operation since 2003 after acquisition of AMDK or
bottled-drinking water product with brand “Anda” supplied from Arjuna mountain spring at
Pandaan. In 2004, the Company established its first Plant at Pandaan, Pasuruan and produces
AMDK with Cleo brand with marketing focus in East Java area. The Company continues its
business expansion ever since by establishing another plant and expanding marketing area
covering to Non-East Java area. Recently, the Company has 20 plants and 72 Logistic Depo
under PT Sentralsari Primasentosa (an affiliated company) located across Java, Sumatera,
Madura, Bali, Kalimantan, Lombok and Sulawesi Islands.

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 3

 The Company was listed in Indonesian Stock Exchange since May 5, 2017 with ticker
code “CLEO”. The Company executed Initial Public Offering on April 26 – 28, 2017 of
450,000,000 shares with par value of Rp. 100 per shares, representing 20.45% of total issued
and fully paid-in capital after the Initial Public Offering. The public offering price was Rp.
115 per share and total proceeds acquired amount of Rp. 51,750,000,000. The shares offered
in the Initial Public Offering are entirely new shares from the Company’s portfolio and will
grant rights to the holders equaly and the same rights with other issued and fully paid-in
shares of the Company, including rights upon dividend payment, rights to vote in the GMS,
rights ton on us stocks distribution and preemptive rights according to provisions stated in the
Limited Liability Company Law.

In maintaining market share and compete with other companies, the Company
continuously maintains product quality and drives innovation and expanding lines of product
to deliver better preferences and added-value for the customers. Targeted market is
Indonesian people who require high-quality and healthy food and beverages products.
Product innovation is done through development in the product packaging aiming to provide
added-value to the customers compared to the Company’s competitors. The innovation
includesPure water, Pure Plastics, Cleo Eco Shape, 19 Litre Cleo Gallon, BPA Free.

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 4

 CHAPTER II

FINANCIAL REPORT

PT SARIGUNA PRIMATIRTA PT SARIGUNA

TBK PRIMATIRTA TBK
DAN ENTITAS
ANAK AND SUBSIDIARY
LAPORAN LABA RUGI DAN CONSOLIDATED STATEMENT OF
PENGHASILAN PROFIT OR LOSS AND
OTHER
KOMPREHENSIF LAIN COMPREHENSIVE
KONSOLIDASIAN INCOME
TAHUN YANG BERAKHIR
PADA TANGGAL FOR THE YEAR ENDED
31 DESEMBER 2017 DECEMBER 31, 2017
(DISAJIKAN DALAM RUPIAH, KECUALI (EXPRESSED IN RUPIAH, UNLESS
DINYATAKAN LAIN) OTHERWISE STATED)

Catata
n/
Notes 2017 2016

PENJUALAN 2n, 2o, 24, 614.677.561.20 523.932.684.97

BERSIH 29 2 2 NET SALES
BEBAN POKOK
2n, 2o, 25, (388.877.393.19 (365.613.453.82
PENJUALAN 29 5) 0) COST OF GOODS SOLD

225.800.168.00 158.319.231.15
LABA BRUTO 7 2 GROSS PROFIT

(96.992.948.421 (74.338.407.870
Beban penjualan 2o, 26 ) ) Selling expenses
General and administrative

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 5

 Beban umum dan (51.481.730.201 (28.168.888.361
administrasi 2o, 27 ) ) expenses
(21.437.623.500 (16.101.190.623
Beban keuangan 2o, 28 ) ) Financing expenses
2m, 2o, 11,
Pendapatan sewa 29 5.488.353.240 4.647.331.208 Rent income
Foreign exchange
Selisih kurs - bersih 2p (155.705.090) 166.180.125 differentials - net
Laba (rugi) penjualan Gain (loss) on sale and
dan disposal

pelepasan aset tetap 12 (4.425.328.297) 1.174.815.921 of fixed assets

Lain-lain - bersih 2o, 9 5.869.054.062 2.310.913.179 Miscellaneous - net

LABA SEBELUM
BEBAN INCOME BEFORE FINAL
PAJAK FINAL
DAN TAX AND INCOME
PAJAK
PENGHASILAN 62.664.239.800 48.009.984.731 TAX EXPENSE

Pajak final 2q, 16 (321.854.545) (314.896.482) Final tax

LABA SEBELUM INCOME BEFORE

BEBAN INCOME
PAJAK
PENGHASILAN 62.342.385.255 47.695.088.249 TAX EXPENSE

MANFAAT
(BEBAN) PAJAK INCOME TAX BENEFIT
PENGHASILAN 2q, 16 (EXPENSE)
(12.747.625.750
Pajak kini ) (8.962.800.500) Current tax
Pajak tangguhan 578.971.324 530.515.236 Deferred tax

(8.432.285.264) Income Tax Expense

Beban Pajak (12.168.654.426

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 6

 Penghasilan )

LABA TAHUN
BERJALAN 50.173.730.829 39.262.802.985 INCOME FOR THE YEAR

LABA (RUGI) OTHER

KOMPREHENSIF COMPREHENSIVE
LAIN INCOME (LOSS)
Pos yang Tidak Akan Item that Will Not be
Direklasifikasi Reclassified
Subsequently to Profit or
ke Laba Rugi Loss
Keuntungan (kerugian) aktuarial
atas Actuarial gain (loss) of
program imbalan
pasti 20 289.918.654 (329.408.029) defined benefit plan

Pajak penghasilan atas (keuntungan)

Income tax of actuarial
kerugian aktuarial atas program (gain)
imbalan pasti 2q, 16 (72.479.664) 82.352.007 loss of defined benefit plan

Laba (rugi)
komprehensif lain - Other comprehensive income
setelah pajak 217.438.990 (247.056.022) (loss) - net of tax

JUMLAH LABA TOTAL

KOMPREHENSIF COMPREHENSIVE
INCOME FOR THE
TAHUN BERJALAN 50.391.169.819 39.015.746.963 YEAR

Catat
an/
Notes 2017 2016

LABA TAHUN
BERJALAN YANG

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 7

 DAPAT INCOME FOR THE
DIATRIBUSIKAN YEAR
KEPADA: ATTRIBUTABLE TO:

Equity Holders of
50.173.768.
Pemilik Entitas Induk 389 39.262.809.556 the Parent Company
Kepentingan Non-
Pengendali 2b (37.560) (6.571) Non-Controlling Interest

50.173.730.
JUMLAH 829 39.262.802.985 TOTAL

JUMLAH LABA TOTAL

KOMPREHENSIF COMPREHENSIVE
YANG DAPAT INCOME
DIATRIBUSIKAN ATTRIBUTABLE
KEPADA: TO:

Equity Holders of
50.391.207.
Pemilik Entitas Induk 379 39.015.753.534 the Parent Company
Kepentingan Non-
Pengendali 2b (37.560) (6.571) Non-Controlling Interest

50.391.169.
JUMLAH 819 39.015.746.963 TOTAL

Laba per Saham yang Earning per Share

Diatribusikan Attributable

kepada Pemilik to Equity Holders of

Entitas Induk 2s, 32 25 31 the Parent Company

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 8

 CHAPTER III

CALCULATION OF FISCAL RECONCILIATION

COMMERCIAL NEGATIVE POSSITIVE FISCAL

INCOMETATE CORRECTIO CORRECTI INCOME
MENTS N ON STATEMENTS
INFORMATION INFO
Net Sales
Related Parties
Rp150.974.822.9
Bottle 50
Rp121.811.105.7
Gallon 09
Rp97.957.826.50
Glass 0
Rp12.292.172.65
Others 7
Manufacturing Rp15.094.762.00
services 0
Total - Related Rp398.130.689.8
Parties 16
Third Parties
Rp55.169.517.75
Bottle 1
Rp114.419.611.6
Gallon 54
Rp40.848.816.62
Glass 6
Others Rp6.108.925.355
Manufacturing
services Rp0
Total - Third Rp216.546.871.3
Parties 86
Total Net sales
Rp206.144.340.7 Rp206.144.340.7
Bottle 01 01
Rp236.230.717.3 Rp236.230.717.3
Gallon 63 63
Rp138.806.643.1 Rp138.806.643.1
Glass 26 26
Rp18.401.098.01 Rp18.401.098.01
Others 2 2
Manufacturing Rp15.094.762.00 Rp15.094.762.00
services 0 0
Rp614.677.561.2 Rp614.677.561.2
Total 02 02

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 9

COGS
Raw Materials Rp221.091.083.8 Rp221.091.083.8
used 82 82
Direct and Rp84.280.151.37 Rp84.280.151.37
indirect labor 9 9
Manufacturing
Cost :
Electricity,
water and Rp40.871.259.50 Rp40.871.259.50
telephone 2 2
Depreciation Rp20.843.295.63 Rp20.843.295.63
(Note 12) 9 9
Plants Rp11.660.116.57 Rp11.660.116.57
operational 4 4
Repairs and
maintenance Rp3.454.586.043 Rp3.454.586.043
Transportation
and fuel Rp6.112.111.212 Rp6.112.111.212
Insurance Rp656.447.889 Rp656.447.889
Others Rp2.153.141.910 Rp2.153.141.910
Cost of Rp391.122.194.0 Rp391.122.194.0
production 30 30
Finished goods
inventory
Beginning of Rp14.768.881.83 Rp14.768.881.83
year 1 1
- -
Rp17.013.682.66 Rp17.013.682.66
End of year 6 6
-
Cost of Goods Rp388.877.393.1 Rp388.877.393.
Sold 95 195
Rp225.800.168.0 Rp225.800.168.0
Gross Profit
07 07
Selling Expense
Advertising Rp29.540.630.20 Rp29.540.630.20
and promotion 5 5
Allowance
for
declining
in value of
inventorie
s
(TEMPOR
ARY
Depreciation Rp22.353.929.89 Rp145.416.5 Rp22.208.513.32 DIFFERE
(Note 12) 5 70 5 NCES)

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 10

 Transportation Rp18.961.393.25 Rp18.961.393.25
and fuel 4 4
Salary, wages
and
employees’ Rp18.301.393.02 Rp18.301.393.02
benefits 9 9
Repairs and
maintenance Rp3.814.078.485 Rp3.814.078.485
Electricity,
water and
telephone Rp403.545.929 Rp403.545.929
Final
income tax
and others
(PERMA
NENT
Rp2.326.120.0 DIFFERE
Others Rp3.617.977.624 02 Rp5.944.097.626 NCES)
- -
Rp96.992.948.42 Rp99.173.651.85
Total 1 3
General and
administrative
Expense

Salary, wages
and
employees’ Rp20.900.615.72 Rp20.900.615.72
benefits 1 1
Depreciati
on
(PERMA
Depreciation Rp12.961.378. NENT
(Notes 11 and 764 Rp18.927.121.39 DIFFERE
12) Rp5.965.742.629 3 NCES)

Professional
fees Rp4.399.950.222 Rp4.399.950.222

Rent Rp3.739.458.116 Rp3.739.458.116

Rp2.798.226. Tax
Taxes Rp3.527.994.926 2 Rp729.768.708 Expense

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 11

 (PERMA
NENT
DIFFERE
18 NCES)

Estimated
liabilities
for
employees
benefits
(TEMPOR
Employees’ ARY
benefits (Note Rp2.140.847. DIFFERE
20) Rp2.186.550.012 961 Rp45.702.051 NCES)

Transportation
and fuel Rp1.744.462.494 Rp1.744.462.494
Security and
cleaning Rp1.717.571.513 Rp1.717.571.513
Licenses Rp1.654.508.243 Rp1.654.508.243
Repairs and
maintenance Rp1.541.109.210 Rp1.541.109.210
Electricity,
water and
telephone Rp1.366.444.302 Rp1.366.444.302

Donation
and
representat
ion
(PERMA
NENT
Rp337.195.7 DIFFERE
Others Rp2.737.322.813 83 Rp2.400.127.030 NCES)
- -
Rp51.481.730.20 Rp59.166.839.00
Total 1 3
Financing
Expense

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 12

 Rp21.023.797.76 Rp21.023.797.76
Interest loans 9 9
Allowance
for
impairmen
t of trade
receivable
s - net
Provision and (TEMPOR
bank ARY
administrative DIFFERE
charges Rp413.825.731 Rp60.800.390 Rp474.626.121 NCES)
- -
Rp21.437.623.50 Rp21.498.423.89
Total 0 0
Rent Income Rp5.488.353.240 Rp5.488.353.240
Foreign
Exchange
differentials - net -Rp155.705.090 -Rp155.705.090
Gain (loss) on
sale and disposal
of fixed assets
Rp11.733.822.99 Rp11.733.822.99
Cost 6 6
Accumulated -
Depreciation -Rp5.813.598.865 Rp5.813.598.865
Book Value Rp5.920.224.131 Rp5.920.224.131
Proceeds from
sales Rp1.494.895.834 Rp1.494.895.834
Gain (loss) on
sale and
disposal of -
fixed assets -Rp4.425.328.297 Rp4.425.328.297
Stock
issuance
costs
(PERMA
NENT
Miscellaneous - Rp2.333.128.0 DIFFERE
net Rp5.869.054.062 35 Rp3.535.926.027 NCES)
Income Before
Final Tax and
Income Tax
Expense
Income Before Final
Tax and Income Tax
Expense per
consolidated Rp62.664.239.80 Rp50.404.499.14
statements of profit 0 1

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 13

or loss and other
comprehensive
income
The share of net loss
of the associate
Loss before income
tax expense of
subsidiary Rp586.003.878 Rp586.003.878 Rp586.003.878
Income Before
Final Tax and
Income Tax Rp63.250.243.67 Rp50.990.503.01
Expense 8 9

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 14

 CHAPTER IV

ANALYSIS

1. Net Sales
A portion of sales, which amounted to 64.771% and 58.121%, for the years ended
December 31, 2017 and 2016, were made to related parties (Note 29), respectively.
For the years ended December 31, 2017 and 2016, there are no sales to third parties
with total sales exceeding 10% of consolidated net sales. Bottle, Gallon, Glass. &
Others. Those elements mentioned above do not need any fiscal correction because
those are included in the deductible goods regarding the tax article based on the law.
Those things also a part of the goods available for sale, because one bottle of mineral
water consist of those elements and every cost of it will be reduce the income of its
selling.

2. Cost of Good Sold

A portion of purchases approximately 24.353% and 26.048% of the years ended
December 31, 2017 and 2016, respectively, were made from related parties (Note 29).
For the years ended December 31, 2017 and 2016, there are no purchases from third
party suppliers with total purchases exceeding 10% of consolidated net sales. Cost of
Goods Sold is no need to be corrected in fiscal correction, because it is a part of good
manufacturing process and selling, also the value added tax will be counted from the
COGS.

3. Selling Expense
a. Advertising and promotion expense
Promotion costs incurred to other parties and are the object of deduction from
Income Tax must be tax deductible in accordance with the applicable provisions.
Thus the amount of commercial and fiscal income statement is the same, which is
Rp29.540.630.205
b. Depreciation
Due to Allowance for declining in value of inventories, there are positive
reconciliation of Rp145.416.570 .
c. Transportation and Fuel Expense

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 15

 Vehicle maintenance costs, routine repairs to the company's operational vehicles
can all be charged as fees, including fuel and for pick-up vehicles for employees.
Thus the amount of commercial and fiscal income statement is the same, which is
Rp18.961.393.254
d. Salary,Wages, and Employee’s benefit
The costs of obtaining, collecting, and maintaining income include the cost of
purchasing materials, costs related to work / services including wages, etc. or
costs which are commonly referred to as daily expenses which are charged in the
year of the required expenditure. this fee can be deducted from income. Thus the
amount of commercial and fiscal income statement is the same, which is
Rp18.301.393.029
e. Repairs and Maintenance
Vehicle maintenance costs, routine repairs to the company's operational vehicles
can all be charged as fees, including fuel and for pick-up vehicles for employees.
Thus the amount of commercial and fiscal income statement is the same, which is
Rp3.814.078.485
f. Electricity Water and telephone
These account are not part of fiscal correction because every these expenses have
costs for obtaining, collecting, and maintaining income (which are objects of non-
final income tax) include: Material purchase costs, fees relating to work or
services including wages, salaries, honorariums, bonuses, gratuities and benefits
provided in the form of money, interest, rent, royalties, travel expenses, waste
treatment fees, insurance premiums, administrative fees, and taxes except for
income tax. Fees must be valid, reliable and reasonable. Thus the amount of
commercial and fiscal income statement is the same.
g. Others
Due to changes in final income tax and others, there are negative reconciliation of
Rp2.326.120.002

4. General & Adminstratif Expense

a. Salary, wages and employees’ benefits
The costs of obtaining, collecting, and maintaining income include the cost of
purchasing materials, costs related to work / services including wages, etc. or

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 16

 costs which are commonly referred to as daily expenses which are charged in the
year of the required expenditure. this fee can be deducted from income. Thus the
amount of commercial and fiscal income statement is the same, which is
Rp.20.900.615.721.
b. Depreciation (Notes 11 and 12)
Based on article 11 Tax Income, depreciation is a mechanism of imposition of
expenditures whose useful lives are more than 1 (one) year related to tangible
fixed assets.
In this company, Depreciation of the asset begins when the asset is ready for
its intended use. Depreciation is computed using the straight-line method over the
estimated useful life of 20 years or at a 5% depreciation rate. Depreciation of
other property, plant and equipment is computed using the double-declining
balance method based on the estimated useful lives of the assets as follows:

Goods Year Rate Method

Machineries and plant
8 - 16 12,5% - 25%
equipment (group 2)
Double
Vehicle (Group 2) 8 25%
Declining
Office equipment (Group 1) 4-8 25% - 50%
Gallon (Group 1) 4 50%
Building and Land 20 5% Straight line

Based on fiscal tax regulation :

Group Useful Life Depreciation Rate
Straight line Double Declining
Group 1 4 Years 25% 50%
Group 2 8 years 12,5% 25%
Group 3 16 years 6,25% 12,5%
Group 4 20 years 5% 10%
Permanent 20 Years 5%
Building
Non-Permanent 10 Years 10%
Building

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 17

 Based on the fiscal and commercial there are the differences of useful life. The
Machineries and plant has useful life in commercial is 8-16 years, meanwhile
Machineries and plant is categorized as group 2 in fiscal term, it should be only
for 8 years. Then for office equipment the commercial term has useful life for 4-8
years. Meanwhile the office equipment is categorized as group 1 should has
usefule life only 4 years. So it should be corrected fiscal.
For the vehicle and gallon has same useful life between commercial and fiscal.
Asset that cannot be depreciated is land, including the right to use buildings,
business use rights, rights to use for the first time. Except the value is reduced in
usage. Same with accounting.
Due to the difference in depreciation costs (especially in terms of useful life),
the depreciation cost has decreased or increased by Rp18,927,121,393. This
makes the taxable profit decrease, so the fiscal correction is called a positive fiscal
correction.
c. Professional fees
Rewards for work but no labor relations, for example: accountant honorarium,
consultant honorarium, audit fees, and other expert services. Because profesional
fees is used for in the context of business (Costs for obtaining, collecting and
maintaining income (which is a non-final PPh object). Thus the amount of
commercial and fiscal income statement is the same, which is Rp.4.399.950.222.
d. Rent
Rent expense is recognized when incurred (accrual method). Rent fees here may
be deducted from income because they are used only in the context of running a
business. Thus the amount of commercial and fiscal income statement is the same,
which is Rp.3.739.458.116.
e. Taxes
Taxes other than income tax and tax sanctions can reduce taxable income. The
type of taxes is land and building, and kind of regional tax. These tax is not
income tax and can reduce the income. In the commercial income the amount is
Rp.3.527994.926. as the decreasing amount of income it will be added from the
total amount of Land and building tax and regional tax which is
Rp.2.120.847.961.

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 18

 f. Employees’ benefits (Note 20)
Employee benefits have payments to workers in connection with their work
(benefits). This employee benefit can be in the form of salary, honorarium, wages,
fees, severance pay, gratuities, benefits, and other benefits related to work.
Employee benefits that are temporary differences (temporary differences) means
that in general accounting this is recognized as a cost, but in fiscal policy in
determining the income tax payable this benefit is still not recognized as a cost. Or
vice versa. in this type, it must be included from the deduction from income
(increasing taxable income), so that the taxable profit increases, the correction is
called negative fiscal correction. In the commercial the amount is
Rp.2.186.550.012 then it will be added as the decreasing of taxable income of by
amount of Rp 2.140.847.961.
g. Transportation and Fuel
Vehicle maintenance costs, routine repairs to the company's operational vehicles
can all be charged as fees, including fuel and for pick-up vehicles for employees.
Thus the amount of commercial and fiscal income statement is the same, which is
Rp1.744.462.494
h. Security and cleaning, Licences, Repairs and maintenance. Electricity, water, and
telephone
These account are not part of fiscal correction because every these expenses have
costs for obtaining, collecting, and maintaining income (which are objects of non-
final income tax) include: Material purchase costs, fees relating to work or
services including wages, salaries, honorariums, bonuses, gratuities and benefits
provided in the form of money, interest, rent, royalties, travel expenses, waste
treatment fees, insurance premiums, administrative fees, and taxes except for
income tax. Fees must be valid, reliable and reasonable. Thus the amount of
commercial and fiscal income statement is the same.
i. Other
All types and types of donations are not permitted in taxation unless donations are
officially regulated by the Government through government regulations such as
GNOT (SE-33/PJ.421/1996), PMI donations and the like. This contribution can be
categorized in this type, it must be included from the deduction from income

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 19

 (increasing taxable income), so that there is a correction of the contribution, the
taxable profit decreases, the correction is called negative fiscal correction.

5. Financing Expense
a. Interest loans
According to the taxation provisions there are several categories that will occur in
the loan interest costs in calculating the entity's income tax. This category is only
used in the calculation of income tax and can be explained as follows: a) Loan
interest costs are allowed in taxation with a certain amount provided that the
average amount of bank debt is greater than the average amount of deposits held,
b) Bank loan interest fees are not allowed as a deduction expense for taxable
income if the average amount of bank debt is less than or equal to the average
number of deposits held, or c) Interest rates on bank loans can be permitted under
the following conditions: The loan funds are deposited or placed in the form of a
checking account which is subject to final income tax services, there is a
requirement for taxpayers to place certain amounts of funds in a bank in the form
of deposits based on the prevailing laws and regulations, as long as the amount of
deposits and savings is solely to fulfill this requirement, and it can be proven that
the placement of deposits or savings funds comes from additional capital and
remaining profits after being taxed.

b. Provisions and bank administrative charges

The commercial imposition of uncollectible receivables by taxpayers is the object
of fiscal reconciliation before determining taxable income. The component of
costs formed due to the establishment or allowance for reserve funds may not be
deducted from gross profit. The allowance for doubtful accounts that have not
been decided as Non-collectible Receivables may not be used as deductible costs
in calculating Taxable Income.

If viewed from the point of view of income tax, the legal basis for imposing losses
on accounts receivable as a deduction from taxable income is regulated in Article
6 paragraph (1) letter h of Law No. 36 of 2008 concerning the fourth amendment
to law number 7 of 1983 concerning income tax:

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 20

 The amount of taxable income for domestic taxpayers and permanent
establishments is determined based on gross income less costs to obtain, collect
and maintain income.
The negative correction of the account is Rp60.800.390, increasing the provisions
and bank administrative charges in the fiscal income statement to Rp474.626.121.
6. Rent Income
For income received or obtained by an individual or entity from leasing land and / or
buildings in the form of land, houses, flats, apartments, condominiums, office
buildings, home offices, shops, shop houses, warehouses and industries, payable final
income tax. CLEO’s 2017 rent income in both commercial and fiscal income
statements has the amount of Rp5.488.353.240.

7. Foreign Exchange Differential

Acording to the explanation of article 4 paragraph 1 letter L "Profits obtained due to
fluctuations in foreign exchange rates are recognized based on the accounting system
adopted and carried out in accordance with the principles in accordance with the
Financial Accounting Standards applicable in Indonesia." Thus CLEO’s 2017 foreign
exchange differentials - net in the commercial income statement has the same amount
with the fiscal income statement, which is Rp155.705.090.

8. Gain (loss) on disposal fixed asset

The acquisition price for assets obtained from a sale and purchase transaction
that is not affected by a special relationship is the amount actually issued (Article 18
of Law Number 17 Year 2000). If a special relationship is affected, the acquisition
price is calculated based on the amount that should have been spent (fair market
price).
Income Tax on the difference in profit from sale of assets in the form of
houses Article 4 paragraph (2) letter d of Law Number 36 Year 2008 article 8
paragraph (1) Government Regulation Number 71 of 2008 stipulates that income from
transfer of rights to land and / or buildings subject to final tax, that is, after repayment.
Tax liability has been completed and income subject to Final income tax is not
combined with other types of income subject to non-final income tax (Non-Final

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 21

 Income Tax). This type of tax can be imposed on certain types of income, transactions
or businesses.

9. Miscellaneous – net
CLEO’s 2017 miscellaneous income in the commercial income statement has
the amount of Rp5.869.054.062. Fiscal reconciliation for tax reporting is required on
this account because of permanent differences in form of allowance stock issuance
costs. The negative correction of the account is Rp2.333.128.035, deducting the
amount of miscellaneous - net in the fiscal income statement to Rp3.535.926.027.

Director General of Tax Circular Number SE18 / PJ.31 / 1989 dated 31

October 1989 item (2) which reads: "Expenditures shares, including the cost of stock
listing, appraisal advertising, underwriting, prospectus, issued in the framework of
issuing shares is fees for obtaining, collecting and maintaining income as intended in
Article 6 paragraph (1) letter b of Law Number 7 of 1983 concerning Taxes Income,
and can be deducted from gross income in accordance with the provisions in Article
11 paragraph (11) of Law Number 7 of 1983 concerning Taxes Income;

According to Article 11A paragraph (3) Income Tax Law, Stock Issuance Costs (IPO)
can be charged as a fee and taxpayers are given the freedom to choose whether the
expenditure is charged at the same time in the year it occurs expenditure or amortized;

Share issuance costs, are related costs in order to obtain, collect and maintain
income as referred to in Article 6 paragraph (1) letter b of Act Number 7 of 1983
concerning Income Tax as amended by Act Number 17 of 2000 and Article 11A
paragraph (3) which regulates: "Expenditures for establishment costs and expansion
costs of a company's capital are charged in the year of expenditure or amortized in
accordance with the provisions referred to in paragraph (2).

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 22

 CHAPTER V

CONCLUSION

RECONCILIATION FISCAL PT SARIGUNA PRIMA TIRTA – TAXATION II 23