Board Resolution Approving Financial Statements Template for Indonesia

When your Indonesian company completes its annual financial statements, you need formal board approval through a Board Resolution Approving Financial Statements. This document is a legal requirement under Indonesian Law No. 40 of 2007 on Limited Liability Companies and serves as official proof that your board of directors has reviewed, considered, and approved the company's financial statements for the fiscal year.

When do you need this document?

You must prepare this resolution annually after completing your company's financial statements, typically within four months of the fiscal year-end. Public companies listed on the Indonesian Stock Exchange need this resolution before submitting annual reports to OJK under Regulation No. 29/POJK.04/2016. You also need this document when external auditors have completed their audit and presented findings to the board, when shareholders are requesting formal approval documentation, or when regulatory authorities require proof of proper board oversight. Banks and financial institutions may also request this resolution as part of loan compliance or credit facility renewals.

Key legal considerations

Your resolution must confirm that the board has thoroughly reviewed the financial statements and supporting documentation, including any auditor's reports. The document should reference compliance with Indonesian Financial Accounting Standards (PSAK) and confirm that the statements present a true and fair view of the company's financial position. Include specific acknowledgment of any significant accounting policies, material changes, or extraordinary items disclosed in the statements. For public companies, you must address regulatory compliance requirements, risk management disclosures, and any related party transactions. The resolution should also confirm that the board has considered the auditor's management letter and any recommendations for internal control improvements.

Legal requirements in Indonesia

Under Indonesian company law, your board resolution must meet specific quorum requirements as outlined in your company's articles of association, typically requiring at least half of the directors to be present. The resolution must be properly documented with the date, time, and location of the board meeting, along with a complete list of attendees. Public companies must ensure compliance with additional OJK regulations regarding financial statement approval timelines and disclosure requirements. The document must be signed by the board chairman or designated directors and maintained in the company's statutory records. For companies with foreign shareholders or international operations, consider including references to international accounting standards convergence and cross-border compliance requirements. The resolution becomes part of your corporate governance documentation and may be requested during regulatory inspections or due diligence processes.