Valuation Deemed Crucial for Supporting Corporate Transactions and Financial Reporting
The government is targeting Indonesia’s economic growth in the range of 5.8 percent to 6.5 percent by 2027 as part of efforts to realise a sovereign, just, and prosperous Indonesia. Based on a Ministry of Finance press release on 9 June 2026, the target was conveyed by Finance Minister Purbaya Yudhi Sadewa in a working meeting with the Budget Committee of the Indonesian House of Representatives (DPR RI) during discussions on the Macroeconomic Framework and Fiscal Policy Principles (KEM-PPKF) for the 2027 Fiscal Year.
This economic growth is certainly not free from various challenges, particularly uncertainty over economic conditions due to the war in the Middle East from early 2026 to the present, which has caused market dynamics and volatile global economic parameters that affect the Indonesian economy, and ultimately affect business players and companies.
Management and business players are faced with challenges in determining the direction of future corporate business policy in facing this crucial moment. In determining business policies or decisions, they often rely on financial reports, economic indicators, and market dynamics in which the business operates. Management and business players are often faced with choices such as restructuring, expansion, divestment, or undertaking other corporate actions related to business development or continuity as well as regulatory compliance.
Head of Valuation at KJPP Wawat Jatmika dan Rekan (Valuation services - BDO in Indonesia), Panca Arief Jatmika, explained that in planning corporate actions, management needs to pay attention to four main aspects: finance, accounting, taxation, and legal.
“The financial aspect includes analysis of transaction schemes, funding, and valuation; the accounting aspect covers a review of the relevant Financial Accounting Standards (SAK) to ensure that corporate action plans are recorded and presented appropriately in financial statements, as well as to understand the impact of transactions on the company’s financial position and performance; the taxation aspect focuses on identifying potential tax obligations and risks; while the legal aspect covers compliance with regulations and the preparation of necessary legal documents,” said Panca.
Panca also underlined the important role of valuers in smoothing strategic actions such as mergers, acquisitions, business restructuring, and funding schemes.
Managing Partner of KJPP Wawat Jatmika & Rekan, Felix Ery Prasetya, emphasised that independence, integrity, and objectivity in carrying out the valuation process are the main keys in the valuation profession.
“Valuation is not merely a final result in the form of a value figure, but rather a complex process based on the code of ethics, valuation standards, and applicable regulations regarding the economic value of a valuation object. Users of valuation services should also understand the definition of value that is appropriate to the purpose and objective of the valuation being carried out so that it can be used and assist users of valuation services in making accountable decisions,” said Felix Ery Prasetya.
In practice, valuation in Indonesia refers to the Indonesian Valuer Code of Ethics (KEPI) and the Indonesian Valuation Standards (SPI) issued by the Indonesian Society of Appraisers (MAPPI) as well as applicable regulations such as Minister of Finance Regulations (PMK) and Financial Services Authority Regulations (POJK), as well as other relevant standards or regulations related to the object being valued, for example Financial Accounting Standards related to valuation for financial reporting purposes.
Valuation reports, both business valuations and property valuations, play a role in providing additional information to company management in supporting corporate transactions to be carried out (pre-transaction), whether for taxation purposes, decision-making, or regulatory compliance. Not only that, business valuation is also needed post-transaction to support financial reporting needs through Purchase Price Allocation or other needs related to financial accounting standards to support impairment tests, measurement of intangible assets, employee stock options, and other financial accounting standard requirements.
Through education on the importance of valuation and the basis of value appropriate to the purpose and objective of the valuation, it is hoped that business players can fulfil regulatory compliance and have additional information in decision-making for more sustainable business in both domestic and global markets.