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KOMPAS.com – The main director of Garuda Indonesia, Irfan Setiaputra, shows off the achievements of the company he leads. The company recorded a positive performance when it was affected by the Covid-19 pandemic.
This state-owned airline recorded a profit of 3.8 billion US dollars or the equivalent of IDR 56.9 trillion (assuming an exchange rate of IDR 14,975 per US dollar) throughout 2022.
In fact, Irfan said, Garuda Indonesia’s profit of IDR 57 trillion was the highest record since the company was founded
“Throughout 2022 we recorded a net profit of US$3.8 billion after 3 consecutive years, both during the pandemic and one year before the pandemic,” said Irfan at the Garuda Indonesia Public Expose, quoted on Saturday (6/3/2023).
Also read: Garuda Suddenly Generates Rp 57 Trillion Jumbo Profit, How come?
This is the biggest profit achievement the company has ever achieved in history,” he said.
Dissecting Garuda’s Rp 57 trillion profit claim
For people who are unfamiliar with the company’s financial statements, Garuda Indonesia’s huge profit of IDR 56.9 trillion certainly raises questions.
Moreover, this state-owned airline has been plagued with mounting debts and often records losses. For example, in the first quarter of 2023 alone, Garuda recorded a loss of IDR 1.61 trillion.
What must be understood, Garuda’s skyrocketing profits occurred due to debt restructuring income with the approval of the Peace Agreement in the Postponement of Debt Payment Obligations (PKPU) process.
This means that the skyrocketing profits or profits of the company are not solely due to the company’s slick performance, but because the company has recorded unrealized revenue.
Also read: The Garuda CEO emphasized that he has never banned a flight attendant from wearing a headscarf
As in the first semester of 2022, Garuda also claims to have made a net profit of IDR 57 trillion. The profit was also contributed from debt restructuring income.
In simpler language, Garuda Indonesia’s profit of IDR 56.9 trillion is just a figure on paper. In accounting records, this term is called book profit or book profit.
Book profit is a type of profit that is recorded in the books, but some of the income has actually not been realized. Book profit recording is indeed common for many companies in accordance with applicable accounting principles, especially accrual-based accounting.
Profit itself is calculated from the company’s income which is then reduced by all company expenses. Garuda’s skyrocketing profits, of course, occurred because it contributed to skyrocketing revenue.
Also read: Creditors Ask Court to Declare Garuda Indonesia Bankruptcy
In Garuda’s case, a profit of IDR 57 trillion arose due to homologation in PKPU. Homologation is the agreement between the debtor and creditor to end bankruptcy.
Where after the existence of PKPU, there is a reversal of liabilities or debt into company income. In other terms, Garuda Indonesia’s skyrocketing profits arose because unpaid debts were then recorded as company income after the existence of PKPU.
The reversal of debt into income is recognized in the accounting records, this is understandable because Garuda Indonesia, which should have recorded debt and interest payments as expenses in the financial statements, then decided not to need to pay it until the due date was set because the creditors were willing to reconcile according to the proposal submitted by the company .
Also read: How Many SOEs Are in China and Why Are They So Powerful?
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2023-06-03 05:51:00
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