In recent years, the framework of Indonesian Financial Accounting Standards (SAK) has changed significantly: PSAK standards have been renumbered, SAK ETAP has been replaced by SAK for Private Entities, and sustainability disclosure standards have been introduced. This article summarizes what business owners and finance teams need to know.
The Four Pillars of SAK in Indonesia
The Indonesian Institute of Accountants (IAI) organizes SAK into several pillars. The choice of pillar depends on the entity's characteristics, particularly whether it has significant public accountability.
- SAK Indonesia — adopts IFRS and is mandatory for entities with public accountability, such as listed companies, banks, and insurance companies.
- SAK for Private Entities (SAK EP) — for entities without significant public accountability. Effective 1 January 2025, replacing SAK ETAP.
- SAK EMKM — the simplest framework, for micro, small, and medium entities that meet the criteria.
- SAK Syariah — for sharia transactions, applied alongside the other pillars.
Government entities and public service agencies (BLU/BLUD) do not use the standards above, but rather Government Accounting Standards (SAP), although some BLU/BLUD also prepare SAK-based reports for specific purposes.
New PSAK Numbering
Since 1 January 2024, IAI has applied a new PSAK numbering system that maps more easily to international standards. Numbers 1xx correspond to IFRS and 2xx to IAS. Some commonly encountered examples:
- PSAK 71 Financial Instruments became PSAK 109.
- PSAK 72 Revenue from Contracts with Customers became PSAK 115.
- PSAK 73 Leases became PSAK 116.
- PSAK 24 Employee Benefits became PSAK 219.
- PSAK 13 Investment Property became PSAK 213.
This change is essentially a renumbering, not a change in substance. However, accounting policies, notes to the financial statements, and working papers should be updated so that references remain consistent.
SAK EP: The Replacement for SAK ETAP
For many private companies, the biggest change is the move from SAK ETAP to SAK EP. SAK EP is closer to the international standard for small and medium-sized entities, so several areas require attention, including the measurement of financial instruments, revenue recognition, leases, employee benefits, and income tax (including deferred tax).
It should also be noted that entities previously using SAK ETAP cannot automatically switch to SAK EMKM. The choice of framework must still match the entity's criteria and the requirements of regulators or other parties requiring the financial statements.
Practical Transition Steps
- Identify the appropriate framework. Determine whether the entity has public accountability and who the primary users of its financial statements are.
- Map policy differences. Compare existing policies with the requirements of the new standard, account by account.
- Calculate the opening balance impact. Prepare opening balance adjustments for the comparative period where required by the transition provisions.
- Prepare supporting data. For example, employee data for employee benefits, lease contracts, and receivables aging for loss allowances.
- Update systems and documentation. Chart of accounts, closing procedures, and templates for notes to the financial statements.
- Discuss early with your auditor. This reduces the risk of major adjustments shortly before the financial statements are issued.
Sustainability Disclosures
IAI has also issued Sustainability Disclosure Standards: PSPK 1 on general requirements and PSPK 2 on climate-related disclosures, adopted from IFRS S1 and S2. Regulators have announced plans for phased implementation effective from 1 January 2027. Entities that are part of large companies' supply chains should start preparing data now.
Conclusion
Applying SAK correctly is more than compliance. Financial statements prepared under a clear framework and policies are easier to audit, more trusted by creditors and investors, and reduce the risk of differences with tax calculations. If your company is transitioning to SAK EP or applying a specific PSAK, our Accounting & SAK Implementation service can help.
This article is for general information only and is not professional advice for any specific case. Regulations may change; please consult us about your situation.