PT HCL Technologies Indonesia

PT HCL Technologies Indonesia Financial statements as of March 31, 2016 and for the nine-month period then ended with independent auditor’s report

PT HCL TECHNOLOGIES INDONESIA FINANCIAL STATEMENTS AS OF MARCH 31, 2016 AND FOR THE NINE-MONTH PERIOD THEN ENDED WITH INDEPENDENT AUDITOR’S REPORT Contents Page Independent Auditor’s Report Financial Statements Statement of Financial Position ..………………………………………………………………… 1 Statement of Profit or Loss and Other Comprehensive Income ..……………………………. 2 Statement of Changes in Equity .………………………………………………………………… 3 Statement of Cash Flows ..……………………………………………………………………….. 4 Notes to the Financial Statements ..…………………………………………………………….. 5-24

The accompanying notes are an integral part of these financial statements 1

PT HCL TECHNOLOGIES INDONESIA STATEMENT OF FINANCIAL POSITION As of March 31, 2016 (Expressed in Rupiah) Notes March 31, 2016 June 30, 2015 ASSETS CURRENT ASSETS Cash and cash equivalents 2c,k,3 2,069,881,794 4,661,560,075 Trade receivables 2d,j,k,4 22,060,923,998 12,873,126,871 Unbilled receivables 2d,j,k,5 9,162,444,528 10,182,116,784 Other receivables 2k,6 50,707,711 33,836,124 Inventories 2e,7 1,890,000 463,014,987 Prepaid expenses 57,549,344 48,381,802 Prepaid taxes 2i,15a 519,293,189 481,675,712 Advance payments - 15,709,361 Security deposits 2k 86,881,688 87,520,888 Total current assets 34,009,572,252 28,846,942,604 NON-CURRENT ASSETS Fixed assets 2f,8 1,208,493,468 3,907,352 Deferred tax assets 2i,15d 1,540,744,437 1,281,095,443 Total non-current assets 2,749,237,905 1,285,002,795 TOTAL ASSETS 36,758,810,157 30,131,945,399

LIABILITIES AND EQUITY CURRENT LIABILITIES Trade payables 2j,k,9 8,546,931,206 4,158,758,322 Other payables 2k,10 908,113,110 265,118,095 Accrued expenses 2j,k,11 1,234,439,074 3,211,393,114 Short term loans 2g,j,k,12 15,886,800,000 13,339,000,000 Taxes payable 2i,15b 1,801,543,168 2,308,616,385 Total current liabilities 28,377,826,558 23,282,885,916 NON-CURRENT LIABILITIES Deferred income 2h,13 53,055,672 277,808,920 Post employment benefits obligations 2l,14 63,584,907 94,559,112 Total non-current liabilities 116,640,579 372,368,032 EQUITY Capital stock 16 9,074,000,000 9,074,000,000 Paid in capital from exchange rate differences 17 1,326,165,000 1,326,165,000 Accumulated deficit 24 (2,135,821,980) (3,923,473,549) Total equity 8,264,343,020 6,476,691,451 TOTAL LIABILITIES AND EQUITY 36,758,810,157 30,131,945,399


PT HCL TECHNOLOGIES INDONESIA STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME For the nine-month period ended March 31, 2016 (Expressed in Rupiah) Notes March 31, 2016 June 30, 2015 Revenue 2h,19 29,689,905,872 27,687,909,797 Cost of sales 2h,20 (22,210,417,758) (18,537,263,466) Gross profit 7,479,488,114 9,150,646,331 Operating expenses Selling and marketing expenses 2h (31,061,909) (13,598,784) General and administrative expenses 2h,21 (5,792,798,344) (7,748,014,282) Total operating expenses (5,823,860,253) (7,761,613,066) Profit from operations 1,655,627,861 1,389,033,265 Other income (expenses) Profit (loss) on foreign exchange, net 2b 816,917,251 (438,823,096) Others (56,664,497) (58,331,673) Total other income (expenses), net 760,252,754 (497,154,769) Profit before income tax 2,415,880,615 891,878,496 Corporate income tax Current tax - expense 2i,15c (887,878,040) (1,117,606,577) Prior year tax - expense 2i,n,15e - (964,008,153) Deferred tax - income 2i,15d 259,648,994 408,290,687 Total corporate income tax (628,229,046) (1,673,324,043) Profit (loss) for the period / year 1,787,651,569 (781,445,547) Other comprehensive income - - Total comprehensive income (loss) for the period / year 1,787,651,569 (781,445,547)


PT HCL TECHNOLOGIES INDONESIA STATEMENT OF CHANGES IN EQUITY For the nine-month period ended March 31, 2016 (Expressed in Rupiah) Paid in capital from exchange rate Accumulated Capital stock differences deficit Total

Balance as of June 30, 2014 4,537,000,000 - (3,142,028,002) 1,394,971,998 Addition of capital stock 4,537,000,000 1,326,165,000 - 5,863,165,000 Total comprehensive loss for the year - - (781,445,547) (781,445,547)

Balance as of June 30, 2015 9,074,000,000 1,326,165,000 (3,923,473,549) 6,476,691,451 Total comprehensive income for the period - - 1,787,651,569 1,787,651,569

Balance as of March 31, 2016 9,074,000,000 1,326,165,000 (2,135,821,980) 8,264,343,020


PT HCL TECHNOLOGIES INDONESIA STATEMENT OF CASH FLOWS For the nine-month period ended March 31, 2016 (Expressed in Rupiah)

2016 2015

Cash flows from operating activities

Profit before income tax 2,415,880,615 891,878,496 Adjustments to reconcile profit before income

tax to net cash used in operating activities: Post employment benefit obligations (30,974,205) 82,340,009 Depreciation expense of fixed assets 8,880,864 3,907,353 Allowance for doubtfull account 694,437,117 1,320,768,094

Operating profit before working capital changes 3,088,224,391 2,298,893,952

Changes in working capital:

Increase in trade receivables (9,882,234,244) (5,006,679,130) Decrease (Increase) in unbilled receivables 1,019,672,256 (8,192,272,976) Decrease (increase) in prepaid expenses (9,167,542) 6,176,269 Decrease (increase) in other receivables (16,871,587) 244,518,301 Increase in prepaid taxes (37,617,477) (252,828,359) Decrease (increase) in advance payments 15,709,361 (15,709,361) Decrease (increase) in inventories 461,124,987 (463,014,987) Decrease (increase) in security deposits 639,200 (9,357,888) Decrease in deferred charges - 78,371,438 Increase in trade payables 4,388,172,884 3,218,214,613 Increase (decrease) in other payables 642,995,015 (89,567,526) Increase (decrease) in accrued expenses (1,976,954,040) 1,428,351,793 Increase in taxes payable (507,073,217) 2,126,602,338 Increase (decrease) in deferred income (224,753,248) 153,957,307

Payment of corporate income tax (887,878,040) (2,081,614,730)

Net cash used in operating activities (3,926,011,301) (6,555,958,946)

Cash flows from investing activities Acquisition of fixed assets (1,213,466,980) -

Net cash used in Investing activities (1,213,466,980) -

Cash flows from financing activities Proceed from issuance of capital stock - 4,537,000,000 Additional paid in capital from exchange rate differences - 1,326,165,000 Increase in short term loans 2,547,800,000 5,026,500,000

Net cash provided by financing activities 2,547,800,000 10,889,665,000 Net increase (decrease) in cash and cash equivalents (2,591,678,281) 4,333,706,054 Cash and cash equivalents at beginning of the year / period 4,661,560,075 327,854,021 Cash and cash equivalents at end of the year / period 2,069,881,794 4,661,560,075

PT HCL TECHNOLOGIES INDONESIA NOTES TO THE FINANCIAL STATEMENTS For the nine-month period ended March 31, 2016 (Expressed in Rupiah, unless otherwise stated)

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1. GENERAL PT HCL Technologies Indonesia (the “Company”) established based on the Notarial Deed of Humberg Lie S.H., S.E., Mkn. No 205 dated July 28, 2010. The Company's articles of incorporation were approved by the Minister of Justice and Human Rights of the Republic of Indonesia in his Decision Letter No. AHU-10.AH.02.02-Tahun 2010 dated February 9, 2010. The Company’s articles of incorporation amendment was made based upon Notarial Deed No. 10 dated November 22, 2011 of Etty Roswitha Moelia S.H., Notary in Jakarta, concerning the increase in authorized capital and changes of the Company’s financial year from January 1 up to December 31 into July 1 up to June 30, which has been approved by the Minister of Justice and Human Rights of the Republic of Indonesia in his Decision Letter No. AHU-00993.AH.01.02.Tahun 2012 dated January 6, 2012. The Company has obtained approval from the Director General of Taxes to changes its financial year/fiscal year from January 1 up to December 31, into July 1 up to June 30, in its decision letter No. KEP-00003/THBK/WPJ.04/KP.0403/2012 dated December 5, 2012. The change is effective starting from financial year/fiscal year 2012. On April 14, 2016, the Company has obtained approval from the Director General of Taxes to change its financial year/fiscal year from July 1 up to June 30, into April 1 to March 30, in its decision letter No. KEP-377/WPJ.30/2016. The change is effective from the financial year/fiscal year 2016. The Company is domiciled at One Pacific Place Building 15th floor SCBD, Jl. Jend. Sudirman Kav. 52-53, South Jakarta. The Company commenced its commercial operation in June 2011. In accordance with Article 3 of the articles of incorporation, the Company is engaged in software and business process outsourcing services. Total employees as of March 31, 2016 and June 30, 2015 are 16 and 8 people, respectively. Based on the Extraordinary General Shareholders’ Meeting notarized by Notary Public Ny. Etty Roswitha Moelia, SH under the deed No. 6 dated February 26, 2014, the Company’s shareholders approved the change of the Company’s commissioners and Directors. The change has been approved by the Minister of Justice and Human Rights of the Republic of Indonesia in his Decision Letter No. AHU-AH.01.10-11400 dated March 17, 2014. The members of the Company's Board of Commissioner and Board of Directors as of March 31, 2016 and June 30, 2015 are as follows:

Commissioner : Mr. Sundharam Sridharan President Director : Mr. Prahlad Rai Bansal Directors : Mr. Manish Anand : Mr. Nalin Mittal

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A summary of significant accounting policies adopted by the Company, which affects the determination of its financial position and results of its operations, is presented below. a. Presentation of Financial Statements

The Company’s financial statements have been prepared in accordance with Indonesian Financial Accounting Standards. The financial statements have been prepared under the historical cost concept and using the accrual basis, unless otherwise stated.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) a. Presentation of Financial Statements (continued)

The statement of cash flows is prepared based on the indirect method by classifying cash flows on the basis of operating, investing and financing activities. For the purpose of the cash flow statement, cash and cash equivalents include cash in banks and time deposits with a maturity period of 3 months or less, as long as these time deposits are not pledged as collateral for borrowings nor restricted. Except as described below, the accounting policies applied are consistent with those of annual financial statements as of June 30, 2015, which conform to the Indonesian Financial Accounting Standards. In order to provide further understanding of the financial performance of the Company, due to the significance of their nature or amount, several items of income or expense have been shown separately. The preparation of financial statements in conformity with Indonesian Financial Accounting Standards requires the use of certain critical accounting estimate. It also requires management to exercises its judgment in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in Note 2n. New accounting standards The following standards, amendments and interpretation which became effective since January 1, 2015 : PSAK 1 (Revised 2013), “Presentation of Financial Statements” The revised PSAK renamed the statement of comprehensive income as statement of profit or loss and other comprehensive income and also requires that items presented in other comprehensive income be grouped into two categories: (1) items that will not be reclassified subsequently to profit or loss; and (2) items that will be reclassified subsequently to profit or loss when specific conditions are met. The amendments only affect the presentation and have no other significant impact on the amounts reported in the Company’s financial statements. PSAK 4 (Revised 2013) “Separate of Financial Statements” PSAK 24 (Revised 2013) “Employee Benefits” PSAK 46 (Revised 2014) “Income Tax” PSAK 48 (Revised 2014) “Impairment of Assets” PSAK 50 (Revised 2014) “Financial Instrument: Presentation” PSAK 55 (Revised 2014) “Financial Instrument: Recognition and Measurements” PSAK 60 (Revised 2014) “Financial Instrument: Disclosures” PSAK 68 “Fair Value Measurements” ISAK 26 (Revised 2013) “Reassessment of Embedded Derivatives” ISAK 15 (Revised 2015) “The limit on a defined benefit asset”

b. Foreign Currency Transactions and Balances

1. Functional and presentation currency

Items included in the Company’s financial statements are measured using the currency of the primary economic environment in which the entity operates (the “functional currencies”). The financial statements are presented in Rupiah, which is the functional and presentation currency of the Company.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

b. Foreign Currency Transactions and Balances (continued)

2. Transaction and balances Foreign currency transactions are translated into Rupiah using the exchange rates prevailing at the dates of the transactions. At each reporting date, monetary assets and liabilities denominated in foreign currency are translated into Rupiah using the management closing exchange rate. Exchange rate used as benchmark is the rate which is issued by the group of the Company. Foreign exchange gain and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in statement of profit or loss and other comprehensive income.

c. Cash and Cash Equivalents

Cash and cash equivalents include cash in hand, deposit held on call with banks and other short-term highly liquid investments with original maturities of three months or less.

d. Trade Receivables

Trade receivables are amounts due from customers for services performed in the ordinary course of business. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current asets. If not, they are presented as non-current assets. Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables are established when there is objective evidence that the Company will not be able to collect all amounts due according to the original term of the receivables. Significant financial difficulties of the debtor, the probability that the debtor will enter bankruptcy of financial reorganization, and default or delinquency is impaired. The amount of the provision is the differences between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an income. When trade receivables are uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited against the statement of profit or loss and other comprehensive income.

e. Inventories Inventories are valued at the lower of the cost or net realizable value. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and estimated costs necessary to make the sale. Cost procured for specific projects is assigned by specific identification of individual costs of each item. Cost is determined using the weighted average cost formula. Provision for obsolete and slow moving inventory is determined on the basis of estimated future usage or sale of individual inventory items.

f. Fixed Assets

Fixed assets are stated at cost less accumulated depreciation and any impairment in value. The cost of an asset comprises its purchase price and any cost directly attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by management.


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f. Fixed Assets (continued) Subsequent expenditures such as replacement and major inspection are added to the carrying amount of the asset when it is probable that future economic benefits will flow to the Company and the cost of the item can be measured reliably. The carrying amount of those parts that are replaced or any remaining carrying amounts of the cost of the previous inspection is derecognized. The costs of day-to-day servicing of an asset are recognized as an expense in the period in which they are incurred. Depreciation is recognized on a straight-line basis to write down the depreciable amount of fixed asset to reduce value of depreciated fixed assets. The estimated useful life of the assets, are as follow: Year

Computer 4 Laptop 4 The residual values, useful life and depreciation method are reviewed at each financial position date to ensure that such residual values, useful life and depreciation method are consistent with the expected pattern of economic benefits from those assets. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount. When an asset is disposed of or when no future economic benefits are expected from its use or disposal, the cost and accumulated depreciation and accumulated impairment losses, if any, are removed from the accounts. Any resulting gain or loss from the recognition of an item of fixed asset is included in the statement of profit or loss and other comprehensive income. The Company chose to adopt the cost model; accordingly, the Company’s fixed asset, are carried at cost less accumulated depreciation and accumulated impairment losses, if any.

g. Borrowings Borrowings are recognized initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortized cost. Any difference between the proceeds (net of transaction cost) and the redemption value is recognized in the statement of profit or loss and other comprehensive income over the period of the borrowings using the effective interest rate method. Borrowings are classified as current liabilities unless the Company has unconditional right to defer settlement of the liability for at least 12 months after the statement of financial position date.

h. Revenue and Expense Recognition

The Company adopted PSAK No. 23 (Revised 2010), “Revenue”. This revised PSAK identifies the circumstances in which the criteria on revenue recognition will be met and, therefore revenue may be recognized, and prescribes the accounting treatment of revenue arising from certain types of transactions and events, and also provides practical guidance on the application of the criteria on revenue recognition. Revenue from material contracts is recognized as related services are performed.


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h. Revenue and Expense Recognition (continued) Revenue from fixed price and fixed time frame contracts is recognized in accordance with the percentage of completion method under which the sales value of performance. Revenue from sale of licenses for the use of software applications is recognized when title in the user license are transfer. Revenue from annual technical service contracts is recognized on a pro rata basis over the period in which such services are rendered. Income from revenue sharing agreements is recognized when the right to receive is established. Expenses are recognized when they are incurred (accrual method).

i. Income Tax The tax expense comprises current and deferred tax. Tax is recognized in the statement of profit or loss and other comprehensive income, except to the extent that it relates to items recognized in other comprehensive income or directly in equity. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the reporting date. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provision where appropriate on the basis of amounts expected to be paid to the tax authorities. Deferred income tax is recognized, using the balance sheet approach method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred income tax is determined using tax rates that have been enacted or substantially enacted as at reporting period and is expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred income tax assets are recognized only to the extent that is probable that future taxable profit will be available against which the temporary differences can be utilised. Amendments to tax obligations are recorded when an assessment is received or, if appealed against by the Company, when the result of the appeal is determined.

j. Transactions with Related Parties The Company enter into transactions with related parties. In the financial statements, the term related parties are used as defined in the Statement of Financial Accounting Standards (“PSAK”) No. 7 (Revised 2010) regarding with “Related Party Disclosures”. The nature of transactions and balances of accounts with related parties, whether or not transacted on normal terms and conditions similar to those with non-related parties, are disclosed in the notes to the financial statements.

k. Financial Assets and Liabilities

Financial Assets Financial assets are classified as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, and available-for-sale financial assets. The Company determines the classification of its financial assets at initial recognition.


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k. Financial Assets and Liabilities (continued) Financial Assets (continued) The Company’s financial assets consist of cash and cash equivalents, trade, unbilled, and other receivables, security deposit classified as loans and receivables. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are initially recognized at fair value plus transaction costs and subsequently measured at amortized cost using the effective interest rate method. Financial Liabilities The Company classifies its financial liabilities into the following category (i) financial liabilities at fair value through profit or loss and (ii) financial liabilities measured at amortised cost. The Company’s financial liabilities consist of trade and other payables, accrued expenses and short term loans. Financial liabilities that are not classified as fair value through profit or loss fall into this category and are measured at amortized cost.

l. Post-Employment Benefit Obligation Employee’s entitlements to service and compensation payments relating to the employee’s separation, gratuity and compensation are recognized. A provision is made for the estimated liability as a result of past services rendered by employees up to the reporting date and is calculated based on the Manpower Law No.13/2003. The Company provides provision for employee’s severance by using current salary for permanent employees multiplied by number of years of service. No funding has been made to this defined benefit plan.

m. Identification and Measurement of Impairment Non-financial assets Under PSAK No. 48 (Revised 2009), "Impairment of Assets", the value of assets are reviewed for possible impairment of assets to the recoverable amount is caused by events or changes in circumstances which identifies its carrying value may not be recoverable. The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Company makes an estimate of the asset’s recoverable amount. Recoverable amount is immediately recognized in statement of profit or loss and other comprehensive income, but not in excess of any accumulated impairment loss previously recognized. Financial assets At each reporting date, the Company assesses whether there is objective evidence that the Company’s financial assets are impaired. Financial assets are impaired when objective evidence demonstrates that a loss event has occurred after the initial recognition of the financial assets, and that the loss event has an impact on the future cash flows on the financial assets that can be estimated reliably.


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2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) n. Use of Estimates

The preparation of financial statements in conformity with the Indonesian Financial Accounting Standards requires the management to use estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities as at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

3. CASH AND CASH EQUIVALENTS March 31, 2016 June 30, 2015

Cash in bank: Citibank Indonesia Rupiah 1,395,502,259 3,029,483,011 US Dollar 665,299,599 1,622,541,020 PT Bank Mandiri (Persero) Tbk. 9,079,936 9,536,044

Total 2,069,881,794 4,661,560,075

Cash in bank generally earn interest at rates based on daily bank deposit rates.

4. TRADE RECEIVABLES March 31, 2016 June 30, 2015

Related parties: HCL Technologies Limited Swiss Branch 198,068,679 - HCL Australia Services Pty. Ltd. 116,656,675 -

HCL Technologies Limited 72,965,124 - HCL Singapore Pte. Limited 18,739,438 - HCL Hong Kong SAR Limited 8,606,370 -

HCL Axon Malaysia Sdn. Bhd. 2,388,393 - HCL America Inc. - 1,980,108 Third parties: PT Bank Mandiri (Persero) Tbk 4,689,228,936 1,280,905,982 Genting Plantations Berhad 4,553,598,236 7,239,501,481 Allianz SE 3,111,567,341 2,118,760,090 S.C. Johnson 2,518,073,013 - Friesland Campina Service Centre 2,286,669,000 - PT CIBA Vision Batam 2,008,382,156 - PT Digita Media Utama 1,542,343,500 1,553,993,500 AXA Technology Services (HK) 1,327,025,189 - PACT Group Pty. Ltd. 1,023,686,130 - PT Agro Indomas 902,899,800 909,719,800 PT Kronicles IT Consulting 851,964,071 858,399,331 PT Globalindo Agung Lestari 844,648,200 851,028,200 AXA Technology Service SEA Ltd. 295,335,612 304,833,237 Misys International Banking Systems 233,006,400 853,322,508 PT Bekaert Indonesia 198,847,141 198,847,141


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4. TRADE RECEIVABLES (continued) March 31, 2016 June 30, 2015

Third parties: Allianze Insurance 198,469,026 199,968,150 Others 165,722,480 915,397,138 Less: allowance for impairment (5,107,966,912) (4,413,529,795)

Trade receivables - net 22,060,923,998 12,873,126,871

Movement of the allowance for impairment at the beginning and end of 2016 and 2015 is shown below: March 31, 2016 June 30, 2015

Balance at beginning of year 4,413,529,795 3,092,761,701 Impairment during the period / year (Note 21) 751,865,302 1,127,658,346 Foreign exchange (57,428,185) 193,109,748

Balance at end of year 5,107,966,912 4,413,529,795

The management believes that the allowance for impairment losses is adequate to cover possible losses from uncollectible accounts.

5. UNBILLED RECEIVABLES March 31, 2016 June 30, 2015

Related parties: HCL Technologies Limited 272,204,411 - HCL Singapore Pte. Limited 461,557 -

HCL America Inc. - 652,279 Third parties: PT Bank Mandiri (Persero) Tbk 3,758,518,900 4,871,296,100 Allianz SE 933,815,725 1,370,558,714 Friesland Campina Service Centre 756,010,265 - PT Unilever Indonesia Tbk 594,777,064 - AXA Technology Services (HK) 159,080,922 - Genting Plantations Berhad 2,661,050,200 971,892,900 Others 26,525,484 2,967,716,791

Total 9,162,444,528 10,182,116,784

6. OTHER RECEIVABLES March 31, 2016 June 30, 2015

Employees 50,707,711 33,836,124

Based on a review of collectibility of outstanding amounts, management believes that other receivables are fully collectible. Therefore, the Company does not provided provision for impairment losses for other receivables.


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7. INVENTORIES March 31, 2016 June 30, 2015

Hardware 1,890,000 463,014,987

Inventories are hardware as component requirement that used to support the installation of the Company’s service to customers. These are mainly laptops, servers, networking equipment’s and other accessories which are purchased from vendor and will be bill to the customer as and when project requirement will be received.

8. FIXED ASSETS

As of March 31, 2016 and June 30, 2015 the details of fixed assets are as follows: March 31, 2016

Beginning Ending Balance Additions Disposal Balance

Acquisition cost: Computer 23,444,117 - - 23,444,117 Laptop - 96,570,000 - 96,570,000 Construction in progress - 1,116,896,980 - 1,116,896,980

23,444,117 1,213,466,980 - 1,236,911,097

Accumulated depreciation: Computer 19,536,765 2,943,896 - 22,480,661 Laptop - 5,936,968 - 5,936,968

19,536,765 8,880,864 - 28,417,629

Book value 3,907,352 1,208,493,468

June 30, 2015

Beginning Ending Balance Additions Disposal Balance

Acquisition cost: Computer 23,444,117 - - 23,444,117

23,444,117 - - 23,444,117

Accumulated depreciation: Computer 15,629,412 3,907,353 - 19,536,765

15,629,412 3,907,353 - 19,536,765

Book value 7,814,705 3,907,352

The amount of depreciation is allocated as follows:

March 31, 2016 June 30, 2015

Depreciation expenses are allocated to: General and administrative expenses 8,880,864 3,907,353

As of March 31, 2016 and June 30, 2015, fixed assets were not covered with insurance against fire and other possible losses.


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9. TRADE PAYABLES March 31, 2016 June 30, 2015

Related parties: HCL Axon Malaysia Sdn. Bhd 3,120,405,342 3,059,568,242 HCL Technologies Ltd. – IOMC 2,987,477,497 - HCL America Inc. 422,919,855 - HCL Hong Kong SAR Limited 235,507,475 - HCL Singapore Pte. Limited 94,916,290 40,367,426 HCL Axon Solutions Kunshan 94,248,520 54,829,388 HCL Technologies Mexico 90,819,540 91,505,540 HCL Great Britain Ltd. 86,445,017 -

HCL Japan Limited 77,651,813 71,999,378 HCL (Brazil) Tecnologia 50,250,346 50,629,909

HCL Axon Technologies Inc. – SD 17,687,304 - HCL Technologies Limited Finl 14,089,397 13,926,556 HCL Technologies Limited. 10,711,410 160,861,768 HCL Axon Malaysia Sdn. - 174,011,431 HCL Technologies (Shanghai) Limited - 103,487,270

HCL Technologies (Swiss) Limited - 40,255,909

Third parties: PT Mitra Buana Komputindo 769,111,200 - PT Avnet Datamation Solutions 459,475,479 - Others 15,214,721 297,315,505

Total 8,546,931,206 4,158,758,322

10. OTHER PAYABLES March 31, 2016 June 30, 2015

Employee payable 160,721,471 - Customer discount - 186,237,442 Others 747,391,639 78,880,653

Total 908,113,110 265,118,095

11. ACCRUED EXPENSES March 31, 2016 June 30, 2015

Consulting cost 791,349,709 2,517,678,768 Interest 309,981,986 81,366,430 Professional fees 133,107,379 595,968,660 Others - 16,379,256

Total 1,234,439,074 3,211,393,114


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12. SHORT TERM LOAN March 31, 2016 June 30, 2015

HCL Singapore Pte. Ltd. – equivalent with USD 1,200,00,00 (2016) and USD 1,000,000 (2015) 15,886,800,000 13,339,000,000

On January 22, 2014, the Company entered into unsecured short-term loan facility agreement with HCL Singapore Pte. Ltd. in amount of USD 500,000. This loan intended for the Company working capital and will be payable on demand with interest of LIBOR rate + 200 bps per annum. On March 12, 2014, the Company amended the unsecured short-term loan facility agreement with HCL Singapore Pte. Ltd. with amount not exceed USD 1,000,000. On January 28, 2016, the Company amended the unsecured short-term loan facility agreement with HCL Singapore Pte. Ltd. in amount of USD 500,000 for tenure of one year and extendable for another period of one year at an interest of LIBOR rate + 100 bps per annum. This loan shall not exceed USD 1,500,000.

13. DEFERRED INCOME March 31, 2016 June 30, 2015

Third parties : Misys International Banking Systems 42,391,300 - PT Bekaert Indonesia 9,008,675 18,792,078 Genting Plantations Berhad 1,655,697 259,016,842

Total 53,055,672 277,808,920

14. POST-EMPLOYMENT BENEFITS OBLIGATION

Referring to Labor Law No. 13/2003 regarding severance payments, requires companies to pay their employees, termination, appreciation and compensation benefits in case of employment dismissal based on the employees’ number of years of services provided the conditions set forth in the decree are met. For the year ended March 31, 2016 and June 30, 2015, the Company did not utilize an independent actuary to calculate provision for employees’ entitlements but has calculated the provision by using current salary for permanent employees. Relative to this, as of March 31, 2016 and June 30, 2015 the Company has recorded provision for employees’ entitlements amounting to Rp 63,584,907 and Rp 94,559,112, respectively. However management is in the opinion that such provision as of March 31, 2016 and June 30, 2015 can cover certain requirements of the said decree and Manpower Law. The number of permanent employees as of March 31, 2016 and June 30, 2015 was 16 and 8 people, with working years around 0-2 years.

March 31, 2016 June 30, 2015

Beginning balance 94,559,112 12,219,103 Provision (reversal) during the period / year (30,974,205) 82,340,009

Ending balance 63,584,907 94,559,112


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15. TAXATION

a. Prepaid taxes March 31, 2016 June 30, 2015

Prepaid income tax art 23 519,293,189 421,921,305 Overpayment corporate income taxes - 59,754,407 Total 519,293,189 481,675,712

b. Taxes payable

March 31, 2016 June 30, 2015

Income tax article 21 44,975,264 - Income tax article 23 4,870,764 3,209,762 Value added tax 222,158,042 558,177,421 Corporate Income tax (Note 15c) 887,878,040 1,117,606,577 Tax provision 641,661,058 629,622,625

Total 1,801,543,168 2,308,616,385

c. Corporate income tax

A reconciliation between profit before income tax, as shown in the statements of profit or loss and other comprehensive income with the estimated taxable income which were calculated by the Company for the nine-month period ended March 31, 2016 and for the year ended June 30, 2015 is as follows:

March 31, 2016 June 30, 2015

Profit before income tax 2,415,880,615 891,878,496

Fiscal adjustments consisted of: Permanent differences: Non-deductible expenses 59,646,688 2,369,961,907 Timing differences: Employee benefits (30,974,205) 82,340,009

Other payable 165,475,532 (44,064,581) Depreciation (21,122,665) (1,953,676) Professional charges (529,034,328) 276,072,896 Provision for bad debt 694,437,117 1,320,768,094 Other provisions 655,232,525 -

Total fiscal correction 993,660,664 4,003,124,649

Estimated taxable income for the year 3,409,541,279 4,895,003,145 Estimated taxable income for the year - rounded 3,409,541,000 4,895,003,000

Calculation of income tax expense and payable is as follow: 12.5% x Rp 551,224,274 68,903,034 106,144,173 25% x Rp 2,858,316,726 714,579,182 1,011,462,404


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15. TAXATION (continued) c. Corporate income tax (continued)

March 31, 2016 June 30, 2015

Estimated corporate income tax payables 783,482,216 1,117,606,577 Correction from prior year 104,395,824 - Estimated corporate income tax pay 887,878,040 1,117,606,577

The corporate income tax calculation for the nine-month period ended March 31, 2016 and for the year June 30, 2015 is a preliminary estimate made for accounting purposes and is subject to revision when the Company lodges its annual corporate tax return.

d. Estimated deferred tax The balances of deferred tax assets as of March 31, 2016 and June 30, 2015 are as follows: March 31, 2016

Credited (charged to) the statement of profit or loss As of and other As of June 30, comprehensive March 31, 2015 income for the period 2016

Deferred tax assets Employee benefits 23,639,779 (7,743,552) 15,896,227 Bonus 776,210 41,368,883 42,145,093 Provision for doubtful debts 1,103,382,449 173,609,279 1,276,991,728 Depreciation expense 488,419 (5,280,666) (4,792,247) Professional charges 152,808,586 (131,590,400) 21,218,186 Performance bonus - 189,285,450 189,285,450

Total 1,281,095,443 259,648,994 1,540,744,437

June 30, 2015

Credited (charged to) the statement of profit or loss As of and other As of June 30, comprehensive June 30, 2014 income for the year 2015

Deferred tax assets Employee benefits 3,054,776 20,585,003 23,639,779 Bonus 11,792,355 (11,016,145) 776,210 Provision for doubtful debts 773,190,425 330,192,024 1,103,382,449 Depreciation expense 976,838 (488,419) 488,419 Professional charges 83,790,362 69,018,224 152,808,586

Total 872,804,756 408,290,687 1,281,095,443


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15. TAXATION

e. Tax assessment letter Based on the tax assessment letter of underpayment of corporate income tax No. 00003/206/ 12/012/13 dated December 17, 2013 and letter of decree No. KEP-474/WPJ.04/2015 issued by the Directorate General of Taxes Office Services, it was stated that for fiscal year 2012, the Company’s underpayment of income tax was Rp 716,498,328. On June 9, 2015 the Company has paid of the above underpayment which was charged as tax expenses in year 2015. It also stated that the fiscal loss compensation for fiscal year 2011 and 2012 were nil. The Company recalculate the corporate income tax for fiscal year 2013 and will have impact to the underpayment of corporate income tax for fiscal year 2013 amounted Rp 247,509,825.

16. CAPITAL STOCK The composition of stockholders as of March 31, 2016 and June 30, 2015 as follows: Number of Percentage of Stockholders shares ownership (%) Par value

HCL Bermuda Limited 990,000 99 8,983,260,000 HCL Singapore Pte. Ltd. 10,000 1 90,740,000

1,000,000 100 9,074,000,000

Based on notarial deed No.7 dated August 27, 2014 of Etty Roswitha Moelia, S.H, the Company was approved the increase of share capital issued and fully paid from Rp 4,537,000,000 (equivalent to US$ 500,000) to Rp 9,074,000,000 (equivalent with US$ 1,000,000) consist of 1,000,000 shares with par value of Rp 9,074 per share.

17. PAID-IN CAPITAL FROM EXCHANGE RATE DIFFERENCES The capital of the Company is stated in the articles of incorporation in both Indonesia Rupiah and US Dollar currencies. The differences between the rate of exchange in the article of incorporation and the actual paid-in capital made by the shareholders were recorded in the paid-in capital from exchange rate differences account, as follows:

Rp

2015 US$ 500,000 of (Rp 5,863,165,000 - Rp 4,537,000,000) 1,326,165,000 Balance as of March 31, 2016 and June 30, 2015 1,326,165,000

18. GENERAL RESERVE The Limited Liability Company Law of the Republic of Indonesia No. 1/1995 introduced in March 1995 requires the establishment of a general reserve from net profits amounting to at least 20% of a company's issued and paid up capital. This regulation has been amended by Indonesian Limited Company Law No. 40 year 2007 which also requires companies to set up a general reserve amounting to at least 20% of the issued and paid-up share capital. There is no set period of time over which this amount should be provided. As of March 31, 2016 and June 30, 2015 the Company has not yet established a general reserve.


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19. REVENUE March 31, 2016 June 30, 2015

Support and maintenance service 29,689,905,872 27,687,909,797

20. COST OF SALES March 31, 2016 June 30, 2015

Consultancy (Note 22d) 11,431,200,049 8,913,775,011 Salaries and wages 8,387,576,470 9,256,958,868 Material cost 2,266,234,029 - Others 125,407,210 366,529,587

Total 22,210,417,758 18,537,263,466

21. GENERAL AND ADMINISTRATIVE EXPENSES

March 31, 2016 June 30, 2015

Profesional charges 1,660,501,223 1,707,436,739 Material damage cost 1,291,716,308 - Travel and conveyance 1,138,528,022 1,626,670,563 Impairment losses (Note 4) 751,865,302 1,127,658,346 Rent office premises 440,865,446 532,234,930 Interest expense 266,013,171 251,585,354 Rates and taxes 133,574,040 2,355,833,775 Others 109,734,832 146,594,575

Total 5,792,798,344 7,748,014,282

22. RELATED PARTIES TRANSACTIONS AND BALANCES In conducting its business, the Company entered into certain business and financial transactions with its related parties.

The nature of related parties is as follows: Related parties Nature of related parties Transactions

HCL Technologies Limited Ultimate Holding Company Trade receivables, unbilled receivables, trade payables, consultancy fee, HCL Singapore Pte. Ltd. Holding Company Trade receivables, unbilled receivables, trade payables, short term loans, deferred charges HCL Australia Services Pty. Ltd. Affiliate Trade receivables HCL Technologies Limited Swiss Branch Affiliate Trade receivables HCL Hong Kong SAR Limited Affiliate Trade receivables trade payables HCL America Inc. Affiliate Trade receivables, unbilled receivables, trade payables, trade receivables


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22. RELATED PARTIES TRANSACTIONS AND BALANCES (continued) Related parties Nature of related parties Transactions

HCL Axon Malaysia Sdn. Affiliate Trade payables, consultancy fee HCL Technologies (Shanghai) Limited Affiliate Trade payables, consultancy fee HCL Technologies Ltd. – IOMC Affiliate Trade payables HCL Axon Malaysia Sdn. Bhd. Affiliate Trade receivables, trade payables, consultancy fee HCL Technologies Ltd. Swiss Affiliate Trade payables, consultancy fee HCL Technologies Ltd. Finland Affiliate Trade payables, consultancy fee HCL Japan Limited Affiliate Trade payables, consultancy fee HCL Axon Solutions Kunshan Affiliate Trade payables, consultancy fee HCL (Brazil) Tecnologia Affiliate Trade payables, consultancy fee HCL Technologies Mexico Affiliate Trade payables, consultancy fee HCL Comnet Limited Affiliate Trade payables, consultancy fee HCL Great Britain Ltd Affiliate Trade payables, HCL Holland Affiliate Trade payables, consultancy fee HCL Technologies Inc. – SD Affiliate Trade payables, These transactions and balances are as follows: a. Trade receivables to related parties as of March 31, 2016 and June 30, 2015 consist of (Note 4):

March 31, 2016 June 30, 2015

HCL Technologies Limited Swiss Branch 198,068,679 - HCL Australia Services Pty. Ltd. 116,656,675 -

HCL Technologies Limited 72,965,124 - HCL Singapore Pte. Limited 18,739,438 - HCL Hong Kong SAR Limited 8,606,370 -

HCL Axon Malaysia Sdn. Bhd. 2,388,393 - HCL America Inc. - 1,980,108

417,424,679 1,980,108

b. Unbilled receivable to related parties as of March 31, 2016 and June 30, 2015 consist of (Note 5):

March 31, 2016 June 30, 2015

HCL Technologies Limited 272,204,411 - HCL Singapore Pte. Limited 461,557 - HCL America Inc. - 652,279

272,665,968 652,279


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22. RELATED PARTIES TRANSACTIONS AND BALANCES (continued)

c. Trade payables to related parties as of March 31, 2016 and June 30, 2015 consist of (Note 9):

March 31, 2016 June 30, 2015

HCL Axon Malaysia Sdn. Bhd 3,120,405,342 3,059,568,242 HCL Technologies Ltd. – IOMC 2,987,477,497 - HCL America Inc. 422,919,855 - HCL Hong Kong SAR Limited 235,507,475 - HCL Singapore Pte. Limited 94,916,290 - HCL Axon Solutions Kunshan 94,248,520 - HCL Technologies Mexico 90,819,540 - HCL Great Britain Ltd 86,445,017 -

HCL Japan Limited 77,651,813 71,999,378 HCL (Brazil) Tecnologia 50,250,346 50,629,909

HCL Axon Technologies Inc. – SD 17,687,304 - HCL Technologies Limited Finl 14,089,397 - HCL Technologies Limited. 10,711,410 160,861,768 HCL Axon Malaysia Sdn - 174,011,431 HCL Technologies (Shanghai) Limited - 103,487,270

HCL Mexico - 91,505,540 HCL Axon Solutions Kunshan - 54,829,388 HCL Singapore Pte. Ltd - 40,367,426 HCL Technologies (Swiss) Limited - 40,255,909 HCL Finland - 13,926,556

Total 7,303,129,806 3,861,442,817

d. Consultancy fees to related parties for the nine-month period ended March 31, 2016 and for the

year ended June 30, 2015 consist of (Note 20):

March 31, 2016 June 30, 2015

HCL Axon Malaysia Sdn. Bhd. 5,967,448,081 3,907,751,494 HCL Technologies Ltd. – IOMC 2,987,477,497 - HCL Technologies Limited 665,431,499 4,088,661,725 HCL America Inc. 440,457,660 - HCL Hong Kong SAR Limited 245,339,291 - HCL Great Britain Ltd. 89,560,118 - HCL Singapore Pte. Ltd. 55,506,780 14,019,541 HCL Axon Solutions Kunshan 43,610,528 54,829,388 HCL Axon Technologies Inc. – SD 17,687,304 - HCL Axon Malaysia Sdn. - 645,567,124 HCL Mexico - 84,981,680 HCL Japan Limited - 71,702,921 HCL (Brazil) Tecnologia - 46,261,138

Total 10,512,518,758 8,913,775,011

Consultancy fee to HCL Technologies Limited is management fee paid by the Company based on Master Service Agreement dated July 1, 2011. On the agreement, HCL Technologies Limited and the Company agreed to perform all services and to undertake obligations. This agreement shall deemed to have taken effect from the effective date of July 1, 2011 and shall continue thereafter until terminate at any time by both parties.


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22. RELATED PARTIES TRANSACTIONS AND BALANCES (continued)

e. Accrued expense to related party as of March 31, 2016 and June 30, 2015 consist of (Note 11):

March 31, 2016 June 30, 2015

HCL Technologies Limited 682,960,293 2,386,584,801 HCL Axon Malaysia Sdn. Bhd. 108,389,416 131,093,967

Total 791,349,709 2,517,678,768

f. Short term loan to related party as of March 31, 2016 and June 30, 2015 consist of (Note 12):

March 31, 2016 June 30, 2015

HCL Singapore Pte. Ltd 15,886,800,000 13,339,000,000

23. RISK MANAGEMENT OBJECTIVES AND POLICIES

Financial Risk Management Objectives and Policies Risk management is integral to the whole business of the Company. The Company has a system of controls in place to create an acceptable balance between the cost of risks occurring and the cost of managing the risks. The management continually monitors the Company's risk management process to ensure that an appropriate balance between risk and control is achieved. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company's activities. The Company has exposure to the followong risks from its use of financial instruments: Liquidity Risk The Company monitors its liquidity risk and maintains a level of cash deemed adequate by management to finance the Company's operations and to mitigate the effects of fluctuations in cashflows. The Company's trade and other payables, accrued expenses and short term loans are due within one year from the statement of financial position date. Credit Risk Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. The Company has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. Cash is placed with reputable banks. The maximum exposure to credit risk is represented by the carrying amount of each financial asset as indicated in the statement of financial position.

The maximum exposure to credit risk as of March 31, 2016 and June 30, 2015 are as follows:


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23. RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) Financial Risk Management Objectives and Policies (continued)

March 31, 2016 June 30, 2015

Cash and cash equivalents 2,069,881,794 4,661,560,075 Trade receivables 22,060,923,998 12,873,126,871 Unbilled receivables 9,162,444,528 10,182,116,784

Other receivables 50,707,711 33,836,124 Security deposits 86,881,688 87,520,888

Total 33,430,839,719 27,838,160,742

The Company continuously monitors defaults of customers and other counterparties, identified either individually or by group, and incorporate this information into its credit risk controls. Where available at reasonable cost, external credit ratings and/or reports on customers and other counterparties are obtained and used. The Company's policy is to deal only with creditworthy counterparties. Market Risk Market risk is the risk that changes in market prices, such as interest rates and foreign exchange rates, will affect the Company's income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

Foreign Exchange Risk Risk of exchange rate against foreign currencies is a risk of fair value or future cash flows of financial instruments fluctuate due to changes in foreign currency exchange rates. Severity of risk is the risk tolerance value which is quite dominant. At this risk, the Company does not manage the impact of risk. The Company is optimistic that domestic economic conditions will continue to improve to incline with appreciated Rupiah. Major monetary assets and monetary liabilities in foreign currencies, as of March 31, 2016 and June 30, 2015 are as follows:

March 31, 2016

AUD CNY EUR GBP HKD JPY MYR SGD USD Total

Major monetary assets in foreign currencies Trade receivables 139 - - - - - 1,135,582 - 397,501 1,533,222 Other receivables 30 - - - - - - - 8,218 8,248

169 - - - - - 1,135,582 - 405,719 1,541,470

Major monetary liabilities in foreign currencies Trade payables (50,298) (46,029) (937) (4,534) (137,797) (658,792) (637,628) (6,965) (78,179) (1,621,159) Other payables - - (25,723) - - - - - - (25,723) Short term loan - - - - - - - - (1,200,000) (1,200,000)

(50,298) (46,029) (26,660) (4,534) (137,797) (658,792) (637,628) (6,965) (1,278,179) (2,846,882)

Excess of assets (liabilities) denominated in

foreign currencies (50,129) (46,029) (26,660) (4,534) (137,797) (658,792) (497,954) (6,965) (872,460) (1,305,412)


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23. RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) Financial Risk Management Objectives and Policies (continued)

June 30, 2015

AUD CHF CNY EUR INR JPY MYR SGD USD Total

Major monetary assets in foreign currencies Trade receivables - - - - - - - - 815,354 815,354 Other receivables 30 - - - 5,789 - 7,365 - 200,031 213,215

30 - - - 5,789 - 7,365 - 1,015,385 1,028,569

Major monetary liabilities in foreign currencies Trade payables - 2,811 73,598 937 5,789 658,792 50,679 1,414 16,687 810,707 Other payables - - - 12,741 - - 37,083 - 225,637 275,461 Short term loan - - - - - - - - 1,000,000 1,000,000

- 2,811 73,598 13,678 5,789 658,792 87,762 1,414 1,242,324 2,086,168

Excess of assets (liabilities) denominated in foreign currencies 30 (2,811) (73,598) (13,678) - (658,792) (80,397) (1,414) (226,939) (1,057,599)

Fair value risk The fair value of the financial assets and liabilities are included at the amount at which instrument could be exchanged in a current transaction between willing parties, other than in a forced liquidation or sale. The carrying amounts of trade, unbilled and other receivables, cash and cash equivalents, trade and other payables, accrued expenses and short term loans approximate their fair values due to their short-term nature.

Capital management The primary objective of the Company's capital management is to ensure that it maintains healthy capital ratios in order to support its business and maximize shareholders' value. The Company manages its capital structure and makes alignment to it, in light of changes in economic conditions.

24. ACCUMULATED DEFICIT

The accumulated deficit amounted to Rp 2,135,821,980 and Rp 3,923,473,549 as at March 31, 2016 and June 30, 2015, respectively, was due to the operating losses incurred by the Company. HCL Bermuda Limited., the Company’s majority shareholder shall continue to provide financial support to the Company to enable the Company to continue to operate as a going concern entity.

25. PREPARATION AND COMPLETION OF THE FINANCIAL STATEMENTS

The Company's managements are responsible for the content and preparation of these financial statements that were completed and authorized to be issued by the Board of Director on August 1, 2016.

Documents

PT HCL Technologies Indonesia