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ARAP TÜRK BANKASI A.Ş.
NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS AT 31 DECEMBER 2013
( Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated. )
CONVENIENCE TRANSLATION OF PUBLICLY ANNOUNCED CONSOLIDATED FINANCIAL
STATEMENTS ORIGINALLY ISSUED IN TURKISH, SEE NOTE I OF SECTION THREE
4
GENERAL INFORMATION
50
CORPORATE MANAGEMENT
67
FINANCIAL INFORMATION
A&T BANK 2013 ANNUAL REPORT
A&T Finansal Kiralama Anonim Şirketi, was founded in 1997 with the aim to provide financial leasing services.
The Parent Bank and its subsidiary A&T Finansal Kiralama A.Ş that is included in consolidation are together referred to as “Group” in
the disclosures and footnotes related to the consolidated financial statements.
“Full Consolidation” method has been applied in consolidating the financial statements of the Bank with the financial statements of its
subsidiary. In accordance with this method, the financial statements of the Parent Bank and its subsidiary are combined on a line-by-
line basis by adding together the all items of assets, liabilities, income, expenses and off-balance sheet items, in preparing consolidated
financial statements. Minority interests are presented separately in the consolidated balance sheet and consolidated statement of
income.
The major principles applied in the consolidation of subsidiaries
The carrying amount of the Parent Bank’s net investment in the subsidiary and the Parent Bank’s portion of equity of the subsidiary are
eliminated.
All intercompany transactions and intercompany balances between the consolidated subsidiary and the Parent Bank are eliminated.
The financial statements which have been used in the consolidation are prepared as of 31 December 2013 and appropriate
adjustments are made to financial statements to use uniform accounting policies for similar transactions and events in similar
circumstances.
IV. INFORMATION ON FORWARD TRANSACTIONS, OPTIONS AND DERIVATIVE INSTRUMENTS
The Group financial derivatives are classified as “Held for Trading” in accordance with TAS - 39 Financial Instruments: Recognition and
Measurement.
Derivatives are initially recorded at their purchase costs including the transaction costs. The notional amounts of derivative transactions
are recorded in off-balance sheet accounts based on their contractual amounts.
The derivative transactions are measured at fair value subsequent to initial recognition and if the fair value of a derivative financial
instrument is positive, it is disclosed under the main account fair values of financial assets through profit or loss” in trading derivative
financial instruments and if the fair value difference is negative, it is disclosed under trading derivative financial liabilities.
Gains and losses arising from a change in fair value of trading derivatives after the re measurement are accounted in the income
statement. The fair value of the derivative financial instruments is calculated using quoted market prices by using discounted cash
flows model.
V. INFORMATION ON INTEREST INCOME AND EXPENSE
Interest income and expense are recognized according to the effective interest method based on accrual basis. Effective interest rate
is the rate that discounts the expected cash flows of financial assets or liabilities during their lifetimes to their carrying values. Effective
interest rate is calculated when a financial asset or a liability is initially recorded and is not modified thereafter.
The computation of effective interest rate comprises discounts and premiums, fees and commissions paid or received and transaction
costs. Transaction costs are additional costs that are directly related to the acquisition, issuance or disposal of financial assets or
liabilities.
In accordance with the related regulation, the accrued interest income on non-performing loans are reversed and subsequently
recognized as interest income only when collected.
VI. INFORMATION ON FEES AND COMMISSION
Fees and commission received and paid are recognized according to either accrual basis of accounting or effective interest method
depending on nature of fees and commission; incomes derived from agreements and asset purchases for third parties are recognized
as income when realized.