Indonesia Stock Exchange (IDX) states the standard calculation method for startup valuation will soon be available, precisely on December 15th, 2017. A guide for valuation calculation is expected to increase startup enthusiasm on finding fresh money through IPO in IDX.
For this standard, IDX coordinates with Indonesia Chartered Accountants (IAI), Statement of Financial Accounting Standards (SFAS) draft-maker. SFAS is a manual book for accountant containing guidelines for archiving, arranging, consulting, and presenting financial reporting.
SFAS is compiled and legalized by official financial institution.
"IAI will launch the SFAS on how to capitalize startup's assets. If it's working, this could be huge. They can go public. SFAS will be launched on December 15th, 2017," Tito Sulistio, IDX's President Director, said in Investor Forum 2017, Thursday, (11/23).
According to Sulistio, Indonesia's startup valuation method is not standardized. In Indonesia, business based on ideas is classified as intangible assets, unable to be converted into number as company valuation.
This intangible assets can be larger than initial funding. After this specific standard available for public, he hopes startup owner will be more enthusiast (on IPO) because intangible assets can be capitalized as part of company valuation.
Nonetheless, it won't be a guarantee, if this SFAS has been applied, that startup's IPO can be fully absorbed by public. The decision is made by the market.
"However, I cannot guarantee whether [the stake] can be fully absorbed by public. I gave it to the market mechanism."
Sulistio also conveyed, one of BEI's efforts to encourage startup to do IPO easily by creating IDX Incubator program. This program is not only focus on startup development products, but also from business aspects to investor relation. Participants will be taught on necessary things to be prepared for the IPO.
Two startups managed to become a public company this year, namely Kioson and M Cash. The company went into the market with its own effort, not because of IDX Incubator program.
- Original article is in Indonesian, translated by Kristin Siagian