Telkom finishes reaudit of 2002 accounts

Telkom finishes reaudit of 2002 accounts

The Jakarta Post, Jakarta

State-owned telecommunications company PT Telkom will file its
reaudited 2002 financial accounts next week, a source at the
company said on Tuesday.

The source was quoted by Dow Jones as saying that the publicly
listed company would likely hand in the results on Monday to the
U.S. Securities and Exchange Commission (SEC). Telkom will hold a
media conference the following day to provide details of the
revised 2002 financial statement.

The completion of the audit is seen as a crucial step to avoid
being delisted from the New York Exchange. Telkom is listed both
on the Jakarta Stock Exchange and in the U.S. stock market.

Problems with Telkom's 2002 financial report emerged after the
U.S. Securities and Exchange Commission (SEC) rejected in June
last year an earlier audit because the report was audited by an
Indonesian accounting firm which was not approved by the SEC.

The SEC has demanded that Telkom resubmit the 2002 accounts as
soon as possible or risk being delisted from the U.S. stock
market. Telkom then called in PricewaterhouseCoopers (PwC) to
reaudit the report.

However, the reaudit has taken longer than expected because
PwC wants to reaudit Telkom's 2001 and 2000 financial reports as
well, since the auditor claimed that they are related to the 2002
report.

PwC then discussed the issues with Deloitte to determine the
necessary adjustments to the reports.

The most complicated issues the two auditors were debating
center on the need to make adjustments in the calculation of
deferred taxes and the consolidation of revenue from Telkom's
former joint-venture company PT Pramindo Ikat Nusantara.

According to a Telkom press statement on Dec. 30, one of the
adjustments would be a decline in its consolidated net income for
2002, 2001 and 2000 by a maximum of 5 percent, 10 percent and 5
percent respectively.

Meanwhile, Telkom shares ended 0.7 percent higher at Rp 7,200
on Thursday following the news and amid an overall rally in the
stock market.