EXPLANATION ON THE AGENDA OF THE ANNUAL GENERAL MEETING OF SHAREHOLDERS OF PT HM SAMPOERNA Tbk. DATED 27 APRIL 2017

Transcription

1 EXPLANATION ON THE AGENDA OF THE ANNUAL GENERAL MEETING OF SHAREHOLDERS OF PT HM SAMPOERNA Tbk. DATED 27 APRIL 2017 In relation to the Annual General Meeting of Shareholders ("AGMS") of PT HM Sampoerna Tbk. (the "Company") which will be convened on Thursday, 27 April 2017, the Company has published through Bisnis Indonesia daily newspaper: The Announcement of the AGMS Plan dated 21 March The Invitation to attend the AGMS on 5 April With respect to: - Law No. 40 Year dated 16 August 2007 regarding Limited Liabilities Companies Laws ( Law 40/20017 ) - OJK Regulation No.32/POJK.04/2014 dated 8 December 2014 concerning the Plan and Implementation of A Shareholders Meeting of Public Companies ( OJK 32/2014 ); - OJK Regulation No.33/POJK.04/2014 dated 8 December 2014 concerning the Board of Directors and Board of Commissioners of Issuers and Public Companies ( OJK 32/2014 ); - The Company s Articles of Association based on Deed No. 21 dated 12 May 2015 made before Notary Aryanti Artisari SH, M.Kn., Notary in Jakarta, as lastly amended by Deed No. Deed No.56 dated 27 April 2016 made before Notary Liestiani Wang SH, MKn., Notary in Jakarta. The Company hereby provides the explanation of each of the agenda of AGM as follows: Agenda 1 Approval of the Annual Report and Ratification of the Consolidated Financial Statements of the Company, for the fiscal year ended on December 31, Background In compliance with (i) Article 9 paragraph 3 points a and b, Article 21 paragraph 3 and Article 21 paragraph 5 of the Company's Articles of Association, and (ii) Article 69 and Article 78 of Law 40/2007, the Company's Annual Report must be approved by the Company's General Meeting of Shareholders ("GMS") and the Company's Consolidated Financial Statements must be ratified by the GMS. 1

2 1.2. Explanation The Company has prepared the Annual Report for the fiscal year ended on 31 December 2016, at least containing the Company's Consolidated Financial Statements for the fiscal year ended on 31 December 2016, audited by the Public Accountant s Office Tanudiredja, Wibisana, Rintis & Rekan (a member of the PricewaterhouseCoopers network of firms), as submitted to the Financial Services Authority ("OJK") and PT Bursa Efek Indonesia ("IDX") on 5 April The Company will seek for the AGMS approval of the Company s 2016 Annual Report and ratification of the Company s consolidated financial statements for the year ended on 31 December Supporting Material The 2016 Annual Report is available at the Company s head office as well as corporate office in Jakarta or can be downloaded on the Company s website since 5 April 2017 or on the same date as the AGMS invitation. Agenda 2 Approval for the use of the Company's retained earnings for the fiscal year ended on December 31, Background In compliance with (i) Article 9 paragraph 3 point c and Article 22 paragraph 1 of the Company's Articles of Association, and (ii) Article 70 and Article 71 of the Company Law, the net income received by the Company within a fiscal year as stated in the balance sheet and the profit and loss statement which have been ratified by the AGMS is to be used in accordance with the resolution of the AGMS, including the determination of allocation for mandatory reserve, dividend payment and other uses, subject to prevailing regulations. 2

3 2.2. Explanation The Company will propose to the AGMS to approve the appropriation of the Company s net profit for the financial year ended at 31 December 2016 as cash dividend to the Company s shareholders Supporting Material The disclosure of the Company s profit can be accessed on the Company s website in the 2016 Company s Annual Report and the Company's Consolidated Financial Statements for the fiscal year ended on 31 December Agenda 3 Approval for the Appointment of a Public Accounting Firm to audit the Company's Financial Statements for the fiscal year ending on 31 December Background Pursuant to Article 68 paragraph 1 point c of the Law 40/2007 and the Regulation of the Capital Market and Financial Institutions Supervisory Agency (Bapepem-LK) No. VIII.A.2 on the Independency of Accountants Providing Services in Capital Market, the Company's Financial Statements must be submitted to a public accountant to be audited Explanation For the appointment of public accountant firm who will audit the Company's books and records for the fiscal year of 2017, the Company's Board of Directors proposes to the AGMS to appoint the Public Accounting Firm Tanudiredja, Wibisana, Rintis & Rekan (a member of the PricewaterhouseCoopers network of firms) to audit the Company's books and records for the fiscal year ending on 31 December

4 3.3. Supporting Material The following is the profile of the Public Accountant and Public Accounting Firm PwC ( provides industry focused assurance, tax, advisory and consulting services to build public trust and enhance value for its clients and their stakeholders. The global network of PwC consist more than 223,000 people in 157 countries who share their thinking, experience, and solutions to develop fresh perspectives and practical advice. KAP Tanudiredja, Wibisana, Rintis & Rekan is a member firm of PwC global network in Indonesia. PwC Indonesia ( PwC or we ) have operated in Indonesia for more than 45 years since We have more than 1,800 employees, including over 52 partners and technical advisors who have experience in providing audit service and independent consultation to multinationals, public sector entities and local companies in Indonesia. Our services are rendered through separate legal entities focusing on different aspects of the service offerings we provide, each of which draw on the collective resources and experience of PwC firms, both here and worldwide. Andry D. Atmadja SE, Ak, CPA Andry is a Partner of Assurance Services division in KAP Tanudiredja, Wibisana, Rintis & Rekan (a member firm of the PwC global network). He has more than 25 years of experience in assurance and other services for public and non-public, local and multinational companies. He has also assisted many advisory works related to the acquisition, disposal and merger. Andry specialises in manufacturing, retail and consumer, plantation and financial services industry. Andry holds license from Ministry of Finance with License of Public Accountant No. AP.0234 and he is also registered in Otoritas Jasa Keuangan with STTD No. 020/NB.122/STTD- AP/2016. Andry was the Lead Partner for the audit assignment of the consolidated financial statements PT HM Sampoerna Tbk and its subsidiaries ( Group ) for the year ended 31 December 2016 and he will be taking the Partner role for the second time in the audit assignment of the consolidated financial 4 statements of the Group for the year ending 31 December 2017.

5 Agenda 4 Approval for the Change in the Composition of the Company s Management Background Pursuant to (i) Article 15 paragraph 3 and Article 18 paragraph 3 of the Company's Articles of Association, (ii) Article 94 paragraph 1 and Article 111 paragraph 1 of the Law 4/2007, and (iii) Article 3 and Article 23 of the OJK Regulation 33/ 2014, members of the Board of Directors are appointed by a GMS. The term of office of the person appointed to replace a vacant post of a member of the Board of Directors shall be the remaining of the term of office of the member of the Board of Directors being replaced Explanation The appointment of the members of the Board of Directors is conducted in accordance with the provisions of Article 15 paragraph 2 of the Company's Articles of Association and other related laws and regulations. The term of office of the incumbent members of the Board of Directors will end at the closing of the fifth Annual General Meeting of Shareholders on 27 April 2015, which is in In this regard, the Company will propose to the AGMS to approve the appointment of William Giff as Director of the Company replacing Michael Sandritter. 5

6 4.3. Supporting Material The following is the profile of William Giff WILLIAM GIFF PROFESSIONAL EXPERIENCE ROTHMANS, BENSON & HEDGES INC. DIRECTOR FINANCE PRESENT Responsible for finance department with a staff of over 75 finance professionals Responsible for budgets, financial reporting, costs accounting, internal controls, treasury and tax departments Review cash projections, working capital requirements, worked with banks for cash investments Discussions with PWC on year-end audits and accounting issues Reviewed factory costs assumptions and analyzed ways to reduce costs through efficiencies Reviewed and signed tax declarations including excise tax payments and corporate income tax Ensure appropriate US required SOX programs in place and company assets are safe guarded Present budgets, forecasts to senior PMI management PHILIP MORRIS LATIN AMERICA AND CANADA DIRECTOR MERGERS AND ACQUISITIONS Led acquisition teams, including business personnel, tax and legal counsel and investment bankers in reviews of various acquisition targets Performed business modeling projections, quantifications of synergies and risks and developed potential valuations for various target companies Led due diligence teams in evaluation of companies financials, tax exposures and reviewed potential contingencies 6

7 Worked with legal department in developing purchase contracts Developed valuations and presentations for PMI BOD approvals Successful acquisitions include Coltabaco in Colombia and Rothmans International in Canada. DIRECTOR PLANNING / CONTROLLER Responsible for Latin America and Canada consolidated financial statement and budgets Coordinated regional reporting submissions, timelines and quality reviews Provided PMI management with business drivers, risks and opportunities in the region Reviewed and evaluated internal audit and PWC findings and reports Reviewed and summarized appropriate US GAAP pronouncements and evaluated applicability within the markets in the region PHILIP MORRIS AUSTRALIA DIRECTOR FINANCE Responsible for finance department with a staff of over 70 finance professionals Responsible for PM Australia s budgets, financial reporting, costs accounting, internal controls, treasury and tax departments Reviewed cash projections, worked with banks to provide needed debt financing and provided dividend capabilities to PMI treasury Worked with PWC on year-end audits Reviewed factory costs assumptions and analyzed ways to reduce costs through efficiencies Reviewed and signed tax declarations including excise tax payments and corporate income tax REGIONAL FINANCE MANAGER Responsible for budgeting and monthly, quarterly and year-end financial statements Responsible for compiling and issuing required Australia statutory reporting Summarized industry drivers, business conditions and trends for regional and PMI management. 7

8 PHILIP MORRIS INTERNATIONAL MANAGER BUDGETING Consolidated PMI world-wide forecasts for senior management review Reviewed and summarized projected business drivers including various countries economic forecasts, taxation developments and industry trends Provided rolling forecasts based on industry conditions Responsible for creating and coordinating PMI budget presentations to PM Companies Management MANAGER EXPORT ANALYSIS AND CONTROLS Performed financial reviews and analyzed credit risk for International US Export Customers Worked with banks to mitigate credit risks including securing bank guarantees and letters of Credit Worked with Insurance companies to secure export credit insurance INTERNAL CONTROLS FINANCE ANALYST Assisted markets in assessing and designing control reviews of various functions Coordinated with the company s Internal Audit function in documenting control deficiencies Discussed and evaluated findings with PWC, the company s external auditors DIAMANDIS COMMUNICATIONS INC DIRECTOR INTERNAL CONTROLS Oct Jul Performed Control Reviews for the company s revenue and procurement cycles Reviewed lease contracts and audited year end escalation charges 8

9 ARTHUR ANDERSEN STAFF AUDITOR SENIOR AUDITOR Aug Sept Staff Auditor - performed year end audits on a variety of public and non-public clients Senior Auditor - ran concurrent jobs with staff and performed quarterly and year end audits, reviews of debt issuances, annual reports and submissions to the US SEC Audited and compiled information required for several IPO s EDUCATION FAIRFIELD UNIVERSITY Connecticut May BS: Major in Accounting; May,