602987067.

docx

PT Ban Indonesia
Period: 31 December 2005

Prepared by: BS, 6 Nov 05

Reviewed by: AS, 6 Nov 05

Date: November 5, 2005

Time: 10 – 12 am
Location of meeting: Client Office 5th floor

The meeting was attended by:

BI : Mr Mushasi, Presiden Direktur

Mr. Kenjiro, Direktur Keuangan

Mr. Ferdy, Manager Akunting dan Keuangan

KAP SAM : Mr Anton, Partner

Mr. Bondan, Manager

Miss. Candy - Senior In Charge

Pada tanggal 20 Oktober 2005, KAP SAM telah mengirimkan fraud check list sebagai dasar
manajemen Perusahaan untuk membuat assessment mengenai kemungkinan terjadinya
suatu fraud atau error yang terjadi pada Perusahaan yang dapat menyebabkan misstatement
yang material terhadap laporan keuangan, dan bagaimana internal control dapat mendeteksi
hal itu.

Meeting ini diadakan setelah manajemen melakukan identifikasi mengenai berdasarkan fraud
check list dari KAP SAM dan untuk up date form P4 jika ditemukan hal yang baru/berbeda.

Use this Form to document information obtained through our inquiries of management
and others.

Inquiries of Management

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602987067.docx

PT Ban Indonesia
Period: 31 December 2005

Prepared by: BS, 6 Nov 05

Reviewed by: AS, 6 Nov 05

We made inquiries of the following management personnel:

Name Title

Mr. Kenjiro Finance Director

Bpk Ferdy FAM Mgr

Management’s overall risk assessment process [e.g., processes used to identify, analyze and
manage the risks (fraud and other) faced by the entity]

Management has monthly BOD meeting to discuss and resolve any issues noted. In addition,
the Japanese management also reports any issues to Ban Japan on monthly basis.

The Company also has policies and procedures for ethical behavior that has already been
announced and the implementation is monitored by management.

Policy that relates to employee are summarized under the Company's Collective Labor
Agreement ("Kesepakatan Kerja Bersama"), in which is communicated with all the employees
upon their joining date to the Company.

Any update rules of conducts are communicated to all employees through their department
manager / head through briefing or written communication.

Each department's manager are responsible in maintaining the application of the Company's
policy and procedures, and every unclear information shall be communicated directly by
them.

Whether management has knowledge of any fraud that has been perpetrated or any alleged
or suspected fraud

Based on our inquiry with FA Manager, management has not detected any suspected fraud
during the year. Management has adopted rotation for every person in one function to another
function within a year basis, including for the accounting members.
The Company also maintains a distinct segregation of duties that could minimize the

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PT Ban Indonesia
Period: 31 December 2005

Prepared by: BS, 6 Nov 05

Reviewed by: AS, 6 Nov 05

occurrence of fraud.

Whether management is aware of allegations of fraud (e.g., because of communications from

employees, former employees, analysts, short sellers, or other investors)

None Noted

Management’s understanding about the risks of fraud in the entity, including any specific
fraud risks the entity has identified or account balances or classes of transactions for which a
risk of fraud may be likely to exist

None Noted

Programs and controls the entity has established to mitigate specific fraud risks the entity has
identified, or that otherwise help to prevent, deter, and detect fraud, and how management
monitors those programs and controls

Management has set segregation of duties for control the business activities such as
purchase, sales, fixed assets, payroll, inventory management.

Whether and how management communicates to employees its views on business practices
and ethical behavior

Management will create memo to their employee if there is any changes in the business
practices and ethical behavior through GA dept and should be distributed to the related
section.

Whether management has reported to those charged with governance (audit committee or
others with equivalent authority and responsibility such as the board of directors, the board of
trustees, or the owner-manager of the entity) on the entity’s internal control, and how such
internal control serves to prevent, deter, or detect material misstatements due to fraud

There is an annual shareholder meeting which report the yearly operational result and the
audited financial statements to the shareholders by president director. There is no issue
related to the risk of fraud that has been detected by management so far.

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602987067.docx

PT Ban Indonesia
Period: 31 December 2005

Prepared by: BS, 6 Nov 05

Reviewed by: AS, 6 Nov 05

Whether the entity carries fiduciary insurance policies (i.e., D&O and E&O) and, if so, whether
the policies require the entity to notify the insurers of certain matters (e.g., risks, uncertainties,
events). Describe any matters reported to the insurance carrier for the period under audit.

None noted

INQUIRIES WITH THOSE CHARGED WITH GOVERNANCE

We made inquiries of the following persons charged with governance members:

Name Title

Musashi Presiden Director

Kenjiro Finance Director

Whether those charged with governance have knowledge of any fraud or suspected fraud

Based on discussion with President Director and Finance Director, no fraud or suspected
fraud noted.

The role, if any, that those charged with governance exercise in the oversight of (1) the
entity’s assessment of the risks of fraud and (2) the programs and controls the entity has
established to mitigate these risks

Having monthly meeting with other BOD members and with Managers. The Company has
established “Kesepakatan Kerja Bersama” as the basis for the ethical behavior.

The views of those charged with governance about the risks of fraud in the entity

In Indonesia, this function is covered by board of commissioners. Noted that the Company
does not have such board, as all the function of those charged with governance are covered
by the review of the Company’s parent company, Ban Japan. Through regular visit, Mr
Musashi, the president director visits parent company to report the Company’s operations and
other things, and vice versa visit also performed by the parent company representatives to the
Company.

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PT Ban Indonesia
Period: 31 December 2005

Prepared by: BS, 6 Nov 05

Reviewed by: AS, 6 Nov 05

INQUIRIES OF THE INTERNAL AUDIT FUNCTION (if applicable)

We made inquiries of the following internal audit personnel:

Qualifications and
Name Title Location Experience

N/A

Whether the internal auditors have knowledge of any fraud or suspected fraud

N/A

INQUIRIES OF OTHERS
In addition to the inquiries listed above, we should inquire of others within the entity about the
existence or suspicion of inappropriate activities. Making inquiries of others within the entity
may be useful in obtaining a perspective that is different from that of individuals within the
financial reporting area.

We made inquiries of the following personnel:

Name Title

Bpk Indra Bastian Sales Manager

Whether the individual has knowledge of any fraud or suspected fraud

None noted

Whether and how management communicates to employees its views on business practices
and ethical behavior

Based on discussion with Bpk. Indra noted that the Kesepakatan Kerja Bersama covers
management points and views on Ban Group practices and ethical behavior. Monthly meeting
within division is also a media for management’s view to be communicated to its employees,
which is represented by director’s head of each division.

Note:
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PT Ban Indonesia
Period: 31 December 2005

Prepared by: BS, 6 Nov 05

Reviewed by: AS, 6 Nov 05

If we have identified any risks that the entity’s risk assessment process failed to identify we
need to consider why that process failed to do so and whether the entity’s risk assessment
process is appropriate.