PT Danasupra Erapacific Tbk (DEFI) began operating in 1995, and is engaged in leasing, factoring and consumer financing. Company's operations are divided into three divisions, namely leasing (provides financial services in the procurement of capital goods such as facilities and equipment production), factoring (providing financing services, which will help employers to improve working capital) and consumer finance (providing financing services for consumer goods)

PT Danasupra Erapacific Tbk (Company) is a public-traded company listed on the Indonesia Stock Exchange (IDX), under the "DEFI" transaction code. Company was established in 1994, based on Deed of Notary Elliza, SH No. 65 dated November 11, 1994 and obtained its legal status from the Minister of Law, Republic Indonesia under Decree No. C2-1.101.HT.01.01 Th.95 dated January 25, 1995, published on the State Gazette of Republic Indonesia No. 15 dated February 25, 2000, Supplement No. 913.

As the Company is engaged in the financing, the Company's business activities include:

Leasing in the form of procurement of capital goods for the lessee, either with or without option rights over the goods;
Factoring is done with the form of the purchase or transfer of receivables / short-term bills of trade at home and abroad, and the administrator company for credit sales and collection of accounts receivable of the Company other;
Consumer Financing is done in the form of provision of funds for the purchase of consumer goods for which payment is made in installments or periodically by the consumer.

The Company has obtained its license as Multi-finance Company from the Minister of Finance under Decree No. 439/KMK.017/1995 dated September 14, 1995. The company started to commercially operated at 1995.

The Company at 2000 submitted a Statement of Stock Issuance Registration t to the Head the Capital Market Supervisory Agency (BAPEPAM) in relation to Initial Public Offering of 5,000,000 shares to the public with nominal value Rp 500 per share.

The pronouncement became effective based on the letter Chairman of the Capital Market Supervisory (BAPEPAM) No. S-768/AM/2000 on April 8, 2000.

The said Deed of Establishment amended as a result of Initial Public Offering of Shares to the public, base on Deed No. 12 dated 18 January 2000, made before Refizal, SH, notary in Jakarta and has attained approval from the Minister of Law, Republic of Indonesia through Decree No. C-1248.HT.01.04TH. 2000 dated February 3, 2000 and was also published on State Gazette of the Republic of Indonesia No. 99 dated December 12, 2000, Supplement No. 7586.

This change marks the Company's name change from PT. Danasupra Erapacific to PT. Danasupra Erapacific Tbk.

Offering and listing of shares on the stock exchange Surabaya done effectively by letter of the Chairman of Bapepam No. S-768/PM/2000 dated 18 April 2000.

Effective date of July 6, 2001, the Company's shares were listed on the Jakarta Stock Exchange (Indonesia Stock Exchange).

In connection with adjustments to the Limited Companies deed No. 40 of 2007, The Articles of Association where also modified, as per the statement of the Extraordinary General Meeting of Shareholders on June 19, 2008 through Deed No. 54 made before Marina Soewana, SH. Notary in Jakarta. This amendment was approved by Minister of law and Human Rights of the Republic of Indonesia through Decree No. AHU-33658.AH.01.02 of 2009 dated July 17, 2009 as announced in the State Gazette of the Republic of Indonesia, dated May 24, 2011 No. 41, Supplement No. 13600.

Vision
Become the best multifinance company

Mission
to support increasing economic by providing fund for working capital, investment and consumer financing

Corporate Values

Core values are the basic principles that underlie moral enterprise at work, patterned think, communicate and act, which must be adhered to, lived, performed and believed by all employees during working Danasupra Erapacific Tbk PT.

Core Values are:

Honesty
Partnership
Justice
Mutual Respect
Maintain Corporate Reputation

Business Activity

Company’s Operation

Under the Regulation of the Financial Services Authority No. 29/POJK.05/2014 concerning Financing Company Financing, the Company aligns its business through the amendment of the Company's Articles of Association. In Article 3 the aims and objectives of the Company are:

Investment Financing
Working Capital Financing
Multi-Use Financing

Investment Financing

Investment Financing is the financing for the procurement of capital goods and services necessary for business/investment activities, rehabilitation, modernization, expansion or relocation of place of business/investment given to the debtor in more than 2 (two) years.
Investment Financing is done by:

Leasing Financing
Sell and Lease
Factoring with Receivables from Receivable Sellers
Purchase by Payments In installments
Project Financing

Working Capital Financing

Working Capital Financing is the financing to meet the needs of expenditures that run out in a cycle of business activities of the debtor and is a financing with a period of maximum 2 (two) years.
Working Capital Financing is done by:

Sale and Lease Back
Factoring with Receivables from Receivable Sellers
Factoring Without Guarantee from Receivable Seller
Business Capital Facility

Multi-Use Financing

Multi-Use Financing is the financing for the procurement of goods and/or services required by the debtor for consumption/consumption and not for business purposes (productive activity) within the agreed timeframe.
Multipurpose financing is done by:

Leasing Financing
Purchase by Payments In installments
Other financing after obtaining approval from the Financial Services Authority first.

Business Performance Analysis

Assets

The Company experienced a decrease in total assets of 8.42% in 2018, ie from Rp. 83.80 billion in 2018 to Rp. 76.75 billion in 2017. This decrease mainly occurred due to a decrease in the placement of investment securities available for sale of Rp. . 7.25 billion (16.09%) from Rp. 45.12 billion in 2017 to Rp. 37.87 billion in 2018 and consumer financing receivables of Rp. 1.77 billion (11.55%) from Rp. 15.36 billion in 2017 to Rp. 13.58 billion in 2018.

The details and percentage of assets of the Company as of December 31, 2018 and December 31, 2017 as follows:

Liabilities

Total liabilities in 2018 decreased by 6.35% (Rp. 72.71 million) compared to the position at the end of 2017. This decline occurred mainly due to a decrease in Deferred Tax Liabilities of Rp 143.52 million (63.59%), namely from in 2017 amounting to Rp 255.97 million to Rp 82.18 million in 2018.

Equity

The Company's total equity in 2017 increased The total equity of the Company in 2018 decreased by 8.45% or Rp 6.98 billion which was to Rp 75.68 billion from Rp 82.66 billion in 2017, this was due to a decrease in Comprehensive profit of Rp. 13.93 billion in 2017 to Rp. 5.30 billion in 2018 (down 61.96%)

Revenues

The Company's revenue comes from factoring and consumer financing, administration income, provision income, fine income, bank interest income and other income.

As of December 31, 2018, total revenue was recorded at Rp 5.70 billion, down by (55.12%) compared to the previous year as of December 31, 2017, which was Rp 12.70 billion. The decrease in income was due to the sale of securities (83.62%) from Rp. 8.70 billion to Rp. 1.43 billion.

Expenses

The Company's expenses are derived from labor, allowance for impairment losses, general and administrative, post-employment benefits, and other expenses. As of December 31, 2018, the Company recorded a total expenses of Rp 3,98 billion, down by 2,33% compared to December 31, 2017, which amounted to Rp 3,87 billion. The increase in total expenses was mainly due to labor, general and administration of 9,64% from Rp 3,63 billion to Rp 3,98 billion.

Comprehensive Profit (Loss)

The Company's total comprehensive income for the year ended December 31, 2018 amounted to (Rp. 6.98) billion, a decrease of 130.76% compared to the year ended December 31, 2017 which amounted to Rp.22.69 billion. The decrease in comprehensive income was due to a decrease in value of available investment securities for sale (not yet realized) of Rp. 22.68 billion (-161,71%).

Cash Flow

Cash flow analysis for operating activities in finance companies is different from other companies in general, where negative value or excessive use of cash, especially for new financing shows the ability of the finance company to obtain new financing. In other words, the greater the use of cash from operating activities, especially on new financing reflects the better growth of the company. The details of the Company's cash flows in 2018 and 2017 can be seen in the table:

Net Cash Obtained from Operating Activities

Net cash obtained from operating activities is Rp. 2.30 billion and (Rp. 9.42 billion) for the year ended December 31, 2018 and 2017. The decrease in net cash obtained from operating activities that occurred on December 31, 2017 compared to December 31, 2016 was Rp. 11.72 billion or equal to 124.47% mainly due to a decrease in financing.

Net Cash Used for Investment Activities

Net cash used for investment activities is Rp. 106 million and (Rp. 9.15 billion) for the years ended December 31, 2018 and 2017. Net cash used in investing activities mainly for investments in the purchase and / or sale of available-for-sale securities amounting to Rp 3.83 billion and Rp. 3.8 billion in the year ended December 31, 2018. The increase in net cash used in investment activities that occurred on December 31, 2018 was 101.17%.

The Ability Of The Payments Of Loans

The company always monitors the cash flow projections and the availability of funds to pay off short-term liabilities. The company does not have bank loans or other long-term liabilities.

Capital Structure and Management Policy on Capital Structure

The Company's capital still uses its own capital, which is derived from paid up capital and retained earnings. The stock capital which was issued and paid-up in 2018 was Rp 33,8 billion.

Realized Capital Goods Investment

Capital goods investment carried out by the Company throughout 2018 is carried out to support operational activities. These capital goods investments include infrastructure, equipment, office furniture, and computers. The value reaches Rp132 million.

Target and Realization of Fiscal Year and the Next Target of Fiscal Year

In the midst of the ongoing economic slowdown the impact on the achievement of the financing target channeled by the Company in 2018. Financing channeled only reached 74% of the planned target, or reached Rp 33,382 bilion from Rp 46,157 miliar. For 2019, the Company targets total financing to reach Rp 42 bilion, or grow by 41% from the realization or achievement of financing in 2018.

Informations and Material Facts Which Occurred After the Date of Accountant Report

There is no material information and facts that occur after the date of the accountant's report for fiscal year 2018.

Marketing Aspect

Marketing

Marketing activities play an important role, both to expand business activities and to maintain market share in the finance industry. The marketing department continues to improve the collaboration with dealers and strategic financing partners to increase financing.

The Company's marketing focuses on providing services and fostering good relationships to business partners, whether banks, financial institutions and other creditors, insurance, dealers and consumers.

Relationship with the Bank

The Company maintains a sustainable relationship with the bank, although there is currently no cooperation with the bank in terms of funding. Good cooperation with the bank facilitates the Company in doing both transaction with the dealers and consumers.

Relationship with Consumers

In order to maintain business continuity, the Company continuously improves customer service starting from the time of credit application until the end of consumer obligation to the Company.

Credit application is processed easily, quickly and safely without leaving the principle of prudence. The Company also provides several installment payment methods to facilitate the consumer. Consumers can ensure that after credit repayment, BPKB can be obtained immediately. In addition, the Company also offers competitive interest.

Relationship with Insurance Company

The Company requires the insurance of the object being financed to minimize the risk. Therefore, the Company maintains good relationswith a credible, national-scale Insurance Company that provides good service to its custom ers and provides a good commitment to the Company in executing its business strategy

Articles of Association

The Articles of association define authority, duties and responsibilities, and determine the structural mechanism for appointing and dismissing members of the board of Directors and the board of commissioners. Statutes define the work relationship between the board of commissioners and the board of Directors as well, in line with the limited liability company law number 40/2007 and capital market law number 8/1995, according to BAPEPAM-LK and related PPATK. Danasupra Erapacific DEFI

Financing of Used Cars and New Cars

Used car financing facility and 4 and more new cars with various brands, types and categories, namely Sedan, Multi Purpose Vehichle (MPV), Sport Utility Vehicle (SUV), Pick Up, Truck and Bus. Consumers may take the form of business entities or individuals, with fixed interest rates and a loan period of 1 to 5 years.

Financing of KPR and KPA

Housing Financing Facility, Home Store, Home Office, Condominium/Apartment, SOHO (Small Office Home Office) with new or used unit condition with 1 to 5 year credit term.

Heavy Equipment Financing

Financing facilities for procurement of capital goods, such as heavy equipment for mining, industry, plantation, forestry.

Multipurpose Financing

Facilities that provide all the conveniences and financial solutions for consumers for various consumption purposes, such as Marriage, Home Renovation, Travel, Worship, Education and other consumption purposes.

Account Guarantee financing

Facilities specifically provide funds for investment and working capital purposes Danasupra Erapacific DEFI

Dividend Policy

With regard to the Company's financial condition from year to year, the company has planned to pay cash dividends to all shareholders. The amount of dividends to be distributed is indexed to the company profit in a given fiscal year, without affecting the financial soundness of the company and without limiting the right of the company General meeting of shareholders to decide otherwise, in accordance to the company`s Articles of Association.

In fiscal year 2012, the Company distributed cash dividends of Rp. 167.648.000 (One hundred and sixty-seven thousand six hundred forty-eight thousand rupiahs) to 67.600.000 (sixty seven million and six hundred thousands) shares. Thus each share getting cash dividend of Rp. 2.24 (two dollars and forty-eight cents). This cash dividend decisions passed by the General Meeting of Shareholders (AGM) Annual held on June 24, 2013 at Menara Peninsula Hotel Jl. Let. Jend. S. Parman Kav. 78 Jakarta 11410. While the distribution of cash dividends made on December 20, 2013 to the shareholders whose names are recorded in the book of shareholders of the Company.

In fiscal year 2011, the Company does not distribute cash dividends to shareholders. This decision was approved by the Annual General Meeting of Shareholders (AGM) l held on June 25, 2012 in Jakarta.

Human Resources Development

The Company deeply understand the importance of human resources to ensure the continuity of the Company. Achievement of the objectives of a Company's work is strongly influenced by the behavior displayed by all individuals within the Company. Behavior is good and effective work can lead to good performance and will indirectly have a positive impact.

In the face of today's business world is increasingly competitive and demanding high individual capability, human resource quality increasingly play an important role in creating a superior company. Therefore, the development of human resources need to implement a performance management strategy appropriate for the employee to show her full potential in accordance with the roles and responsibilities that exist in each line.

The Company adopts the strategy rewards associated with managing employee performance. Management strategy rewards emphasizes how an appreciation award for the performance of employees in the organization. Through good and competitive strategy reward is one way to achieve superior and qualified employees.

Corporate Governance

Corporate governance is an important aspect in managing the Company's day-to-day operations to support the development of better information, transparent and accountable to the Shareholders and implement best practices in the management of a trustworthy and professional.

The Company realizes the importance of the implementation of Good Corporate Governance (GCG). By implementing GCG, the Company seek to balance entrepreneurship, control the transparency, which supporting operations through efficient decision-making.

The appointment of an Independent Commissioner and the establishment of Audit Committee are both aspects of GCG implementation within the organization of the Company. In the future the Company will continue implementing GCG principles into its business activities, to increase Shareholders’ value.

Good Corporate Governance (GCG) is the key importance for the Company to rum its business. The company recognizes GCG’s important role, not only to add value to stake holders, but also to create corporate advantage in facing competition. GCG implementation is integral to its survival, as coherent to Law No. 40 year in 2007 regarding Limited liability Company, BAPEPAM-LK (OJK) regulations and GCG general guidelines are compiled in accordance with GCG parameters, which are Transparency, Accountability, Responsibility and Fairness in conducting business activity.

Duties and Liabilities of The Board of Commissioners

The Board of Commissioners consists of two members one President Commissioner and one Independent Commissioner.

The main duty of the Board of Commissioners as below :

Every member of the Board of Commissioner should work with good faith, prudent principles, and be responsible in discharging its supervisory function and providing advices to the Board of Directors for the interest of and in accordance with the purposes and objectives of the Company.
The Board of Commissioners should carry out its duties and responsibilities independently and should ensure the implementation of Good Corporate Governance in every business activity of the company at all levels of the organization. The board of commissioners should ensure that the board of directors has initiated follow-up action on audit findings and recommendations from internal audit unit, external auditors as well as oversight outcomes from Bapepam-LK and/or other authorities.
In discharging its supervisory function, the Board of Commissioner shall provide direction, monitor, and evaluate the implementation of the Company`s strategic policies. But the Board of Commissioners shall not involve in any operational decisions of the Company, except in other matters as stipulated the Articles of Association and prevailing laws.

The Board of Commissioners is fully responsible for the supervision of the Company in terms of:

Ensuring the implementation of GCG in each and every Corporate venture at all levels of organization.
Evaluating, monitoring and directing the implementation of Company strategic policy.
Monitoring the performance of duties and responsibilities of the Directors, as well as providing advice and guidance to the Board of Directors.
Providing sufficient time to carry out their duties and responsibilities in an optimal way.
Ensuring that the Board of Directors has performed a follow up on audit findings and recommendations from the company internal audit unit, external auditors, OJK and Indonesia Stock Exchange audit results, and/or findings from other related regulatory institutions.

Duties and Liabilities of The Board of Directors

The Board of Directors consists of two members one President Director and one Directors.

Each member of the board of directors must show loyalty and good intentions in the task of managing the Company for the benefit of the Company in accordance with the purposes and objectives of the Company.

The main duties and responsibilities of the Directors:

The Directors are fully responsible for the executions of company management.
The Directors shall manage the company in accordance with the authority and responsibilities as provided in the Articles of Association and the rules and regulations in force.
The Directors must implement GCG principles in any business activities of the Company, applying them to all levels of the organization.
The Directors must follow up on audit findings and recommendations of the Company`s internal audit unit, external auditors, OJK supervision results, and/or results of other authorities.
The Directors are to represent the Company both within and outside a court of law.

Senior management, the Board of Directors and Commissioners perform his duties in a professional manner at every level without conflicts of interest.

In determining the amount of the Commissioner and the Independent Directors are proportional, the Company applies the principles of CGC. The presence of Independent Directors and Commissioners in the board of management of the company to prove that the Company is committed to protecting the interests of both the majority and minority shareholders.

To anticipate the unexpected developments, the Company's Management has decided to increase the application of CGC with reference to best practices in managing and evaluating its performance.

Audit Committee

The Audit Committee is appointed by and responsible to the Board of Commissioners. The main duty of the Audit committee is to assist the Board of commissioners in ensuring the running and maintenance of Good Corporate Governance practices and sufficient company supervision.

The Audit Committee monitors audit plan efficiency and inspects internal audit reports, working specifically to tighten internal control in the Company. The Audit Committee also establishes a relationship with independent auditor to review business plans and to follow up on their meetings further, it provides brief reports in assessing the overall framework of the implementation of Good Corporate Governance standards.

In line with standing regulations of BAPEPAMLK (today replaced by financial services authority) and the Indonesia Stock Exchange (IDX), the Audit Committee report directly to the Board of Commissioners. The principal responsibility of the Audit Committee is to support the Board of Commissioners in performing various supervisory and evaluation duties, including evaluating and advising on ways to upgrade the quality of financial reports, monitoring operational performance of the Company and improving the effectiveness of the tasks of the internal auditor and independent auditor, while identifying any problems which might require intervention by the Board of Commissioners.

In 2019 the Audit Committee was comprised of Yugi Prayanto (Independent Commissioner), Nike Felina (member) and Erikson Putra (member). The principal duty of the Audit Committee is to support the Board of Commissioners in performing its oversight and monitoring function of the implementation of Company operations, through internal control systems.

All the results released by the Audit Committee throughout 2013 have been delivered to the Board of Commissioners. The Audit Committee did not find any major or material matters in the 2013 annual report to bring to the attention of the Board of Commissioners.

Report of The Audit Committee

In 2013, there were 3 Audit Committee meetings, including meetings with internal auditors and the Board of Director. Each record and comprehensive minutes of meeting was conveyed to the Board of Commissioner. Each meeting focused on evaluation and assessment of the audit process, and how this related to actions taken, based on audit reports submitted by, from internal audit and public accountants.

The presence of the audit committee in the joint meeting between the Board of Commissioners and the Board of Directors grants it the right to actively participate in advising and evaluating the performance of the Board of Directors in managing the Company, and providing professional counsel on ways to improve Company performance. This function must be applied consistently, to avoid errors or misunderstandings, while accessing recommendations on various matters that require the attention of the Board of Commissioners.

The 2013 Financial report has been audited by an independent auditor Drs. Bambang Sudaryono & Partners, and checked by the Audit Committee then the results are submitted formally to the Board of Commissioners. A number of comments, questions and suggestions were made in response to this document, regarding accounting standards, the balance and financial highlights.

The Audit Committee also examined the audit reports of the Internal Audit. In some meeting discussed matters concerning internal controls and processes related to compliance audit findings and Principles of Good Corporate Governance.

Based on the audit reports mentioned above, the Committee Audit did not find anything that is material that needs to be delivered at the 2013 Annual Reports.

Corporate Secretary

In accordance with the provisions of the Financial Services Authority (OJK) Regulation No. 35/POJK.04/2014 concerning Corporate Secretary of Issuers or Public Companies, the Company has appointed Irianto Kusumadjaja to serve as the Corporate Secretary and carry out his duties fully since November 1, 2019.

This is a form of commitment of transparency toward all stakeholders. The key role of the Corporate Secretary is to serve as the conveyer of company information to the public (the Government of Indonesia, investors and the public at large), as well as providing pertinent information related to prevailing regulations of the Board of Directors. The Corporate Secretary provides information relating to condition, market developments (particularly regarding regulatory matters) and recommendations to management for better compliance and fulfillment of prevailing capital market regulations. Thus, the Corporate Secretary has three main areas of duty: Liaison officer, Compliance officer and Investor Relations Executive. The Corporate Secretary holds a pivotal position in communicating key messages to stakeholders, as crucially required by management.

Internal Audit Unit

Internal audit is a Division administered under the Directors and is able to communicate directly with the Board of commissioners in regard to matters related to company audit. The internal audit division is supervised by the Head of Internal Audit, who was appointed and later dismissed by the President Director through a recommendation of the Board of Commissioners. Duties and responsibilities of the internal audit division include: to ensure and assure that all corporate operational activities are running according to Company rules and regulations, Company policies and procedures as applied.

Through 2013, the internal audit division has carried out internal audit 2 (two) times. With aspects of audit covering corporate compliance issues related to finance, operations, and other strategic issues that affect company performance.

In carrying out its supervisory role and controlling operational, finance, and compliance activities, with the intention of conforming to regulations, regulatory laws and corporate operational standards, internal audit division regularly observes and provides feedback and suggestions for resolution of problems that arise. Here is a brief description:

Create planning for audit execution 2 (two) times in a year: prepare for audit plan framework and audit aspects.
Set up Standard Operating Procedure (SOP) in accordance with regulatory standards and also any applicable rules and regulations.
Co-operation within other divisions in the company to ensure continuous internal control commitment, risk management, and implementation of Good Corporate Government.
Ensure regular and timely reporting of audit results to Audit Committee for further review, which is then submitted to the Board of Directors for further action.
Ensure commitment from management in implementing continuous improvement in order to comply with Good Corporate Governance.

In 2019, the Internal Audit Division was headed by Siti Amelia Mardatila.

Risk Management

The implementation of risk management has always been an integral part of accomplishing the Company management system. This risk management process is one of the many steps taken by the Company in order to create continuous improvement.

Risk management has a very important role in the Companies to increase profits, business continuity becomes more positive and still survive in an era of intense competition.

Risk management is intended to identify, measure, while managing the risks faced by the Company in order to avoid the losses that much more. Analysis of risk management includes accounts receivable, interest, product, quality of collateral, consumer, and so on. The results of this analysis will be used as a marketing strategy planning.

The main function of risk management is to reduce the default rate ratio, by applying sales control, especially when the consumer survey and analysis of credit for consumers who netted really worth.

The Company Risk Management is structured method logically and systematically from a series of activities which consists of defining the context, identification, analysis, evaluation, control and communication of risk.

This process is applied in all levels of activity, position, project and even with Company`s asset. The implementation of risk management in Company has provided many benefits to the start of each Company’s activity. One of them is by reducing the chances of risk. The role of risk management implementation is expected to be able to anticipate on the environmental changes that are happening so quickly, develop Corporate Governance and protecting the resources and assets of Company.

In the application of risk management, Company has a clear picture of the functions and duties, among others: shall coordinate and cooperate in promoting policies that will maintain a good working relationship between the business partners and stakeholders. Each reporting violations are recorded and followed up to be distributed to all related units to prevent future similar violations will come. To minimize the risk of such breach, the Company adopted a standard procedure (SOP) will be sustained and updated continuously adjusted in accordance with OJK rules and regulations of the capital market and other related regulators.

Business Risk

Risk of Failure to Achieve Projection

Generate profit is a challenge for the Company. Therefore, the company is always trying to increase the revenue projections in an effort to reassure investors that the business continues to run smoothly. Failure to achieve the target net profit growth projected for next year reduce the expected rate of return on investment by shareholders.

The risk of not achieving the projected managed by increasing the competence of HR related, financing portfolio adjustment, and repair strategies of the Company.

Operational Risk

Operational risk due to the reduced level of effectiveness of operational systems, procedures and controls of the Company. If this risk can be controlled, it will result in a disruption of smooth operations and quality customer services that can have an impact on decreasing the performance and competitiveness of the Company.

Operational risk is managed by means of improving operational excellence, optimizing the use of technology in implementing the Company's operations, and improve the competence of HR related.

Economic Conditions

The development of Indonesian economic conditions resulting from many factors such as inflation, higher interest rates, and the rise and fall of the rupiah against the U.S. dollar or other currencies may affect the performance of the financing.

Interest Rate Risk

Significant movement of bank rate and currency exchange rate can affect the financing impact on the Company's performance results.

Interest rate risk is managed by means of an increase in HR related competencies, financing portfolio adjustments.

Political Climate

After Indonesia successfully through the Asian financial crisis in 2008, the Company is optimistic Indonesia will experience growth in the banking sector, industrial sector, and the business sector as well as other developed countries which will affect the operational performance of finance companies in Indonesia, including the Company's performance.

Government Regulatory Risk

Risks faced by the Company relating to changes in government regulation is caused by the negligence of the Company to comply with the new regulations set by the government.

Negligence of the Company to comply with the new regulations, especially in the field of capital markets (which is now called the Financial Services Authority "FSA") issued either directly by Bapepam-LK (FSA) as a government body appointed to regulate and supervise the activities of the capital market and by statutory provisions. Failure to comply with the new regulations and the provisions of the Capital Markets (FSA) applicable in Indonesia could affect the Company's operating revenues.

Competition

At this time the business world, especially the financing industry is becoming increasingly competitive banking sector are also included in this industry. Finance companies that have a direct connection with the upstream industry will be a challenge for the Company's strategy to cultivate the competition in order to maintain its market share. In some cases it takes actions that have a negative short-term impact on margins and earnings.

Risk of Professional Workforce Migration

Every company today believe that human resources are the most important asset of the Company. The success or failure of the Company depends upon the quality of its workforce. Displacement professional workforce of the Company to other companies, especially companies to competitors who have similar activities by the Company may provide a negative influence on the performance and reputation of the Company.

This risk is managed by applying a reward system that is fair and competitive, as well as providing opportunities and a clear career path to employees of the Company. Danasupra Erapacific DEFI

Danasupra Erapacific DEFI