5 Mistakes in Indonesia’s LKPM Reporting and How to Avoid Them

The LKPM Report Indonesia (Laporan Kegiatan Penanaman Modal) or Investment Activity Report is a mandatory submission for businesses in Indonesia. Accurate and timely LKPM reporting ensures compliance, maintains investor trust, and keeps your operations penalty-free. 

However, many companies stumble by making common mistakes that result in penalties, operational hindrances, or worse. These consequences can significantly impact your business operations and financial health. Fortunately, with the proper preparation, these cases can be avoided. 

Why LKPM Reporting Matters for Businesses in Indonesia 

Under Law No. 25 of 2007 on Investment, Articles 15 and 16, all business actors must: 

• Use legitimate and traceable investment capital to ensure financial transparency. 
• Avoid monopolistic practices while promoting fair market competition. 
• Uphold good corporate governance and maintain environmental responsibility. 
• Submit accurate and timely LKPM reports to the BKPM (Indonesia Investment Coordinating Board) as part of ongoing compliance. 

Beyond compliance, LKPM reporting fulfills your legal duties and amplifies your voice as an investor, making it vital to sustaining and growing your business in Indonesia. Your role as an investor is crucial, and LKPM reporting is a key way to demonstrate your commitment to transparency and good governance.

READ MORE:

• LKPM in Indonesia: Full Reporting Guide
• Guide to Annual Reports: Format, Content, and How to Create One
• Understanding the Importance of Financial Reporting for Businesses 

5 Common Mistakes in LKPM Reporting Indonesia 

Many companies in Indonesia unintentionally make serious errors in their LKPM reporting, which can lead to compliance issues and potential sanctions. These sanctions can include fines, suspension of business activities, or even revocation of business licenses. The most frequent mistakes include: 

• Repeated Zero-Investment Reporting Without Reason: Submitting “no activity” reports for multiple periods without a valid explanation. 
• Missing Submission Deadlines: Especially common during the initial operational phase, when reporting requirements may be overlooked. 
• Incorrect Data Reporting: 
  • Failing to break down investment amounts by KBLI (Indonesian Business Classification Code) and specific business location. 
  • Report cumulative investment totals instead of the newly realized investment for that particular reporting period. 
• Confusing Submission with Compliance: Your LKPM report is only considered compliant in the OSS system, a platform managed by the BKPM, when its status shows “Approved” rather than “Submitted.” 
• Incomplete Documentation: Failing to attach supporting documents when required. 

Avoiding these mistakes is important to protecting your business from penalties, maintaining good standing with BKPM, and ensuring smooth operational continuity. It also ensures compliance and enhances your business reputation and operational efficiency. 

How to Avoid LKPM Reporting Mistakes 

Staying compliant with LKPM reporting doesn’t have to be difficult; most errors can be prevented with the right approach and internal systems. Here are practical steps to ensure accuracy and timeliness: 

• Know Your Deadlines: Mark BKPM submission dates on your calendar to prevent late reports. 
• Keep Accurate Records: Track all investments using the KBLI code and location. 
• Report Only New Investment: Enter the amount realized in the current period, not total past investments. 
• Explain Zero-Activity Periods: Give a valid reason if no investment is made. 
• Check OSS Approval: Ensure your report status shows “Approved”, not “Submitted.” 
• Get Expert Help: Professional LKPM report services can ensure accuracy and full compliance.

Expedite Your LKPM Report with InCorp 

While you can handle LKPM reporting through OSS, precision and knowledge of BKPM regulations are required. InCorp Indonesia (an Ascentium Company) can ensure you through our LKPM reporting services with: 

• Accurate & Compliant Reports: Every detail meets BKPM requirements to avoid costly resubmissions. 
• On-Time Submission: We track deadlines and submit promptly to keep you compliant. 
• End-to-End Service: We manage everything from preparing investment data to securing OSS “Approved” status. 

Don’t risk penalties or delays. Complete the form below to simplify your LKPM reporting and ensure fast, hassle-free approval.

Frequently Asked Questions