88 / 272
88
A&T BANK 2014 FAALİYET RAPORU
ANNU L R PORT 2014
Convenience Translation of Publicly Announced Unconsolidated Financial
Statements Originally Issued in Turkish, See Note I of Section Three
Arap Türk Bankası A.Ş.
Notes to Unconsolidated Financial
Statements at 31 December 2014
( Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated. )
XV. INFORMATION ON PROVISIONS AND CONTINGENT LIABILITIES AND CONTINGENT ASSETS
Provisions and contingent liabilities are provided for in accordance with the TAS 37-Provisions, Contingent Liabilities and Contingent
Assets, except for the general and specific provisions set aside for the loans and other receivables.
Provisions are recognized when the Bank has a present legal or constructive obligation as a result of past events, it is probable that an
outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of
obligation can be made.
A provision for contingent liabilities arising from past events should be recognized in the same period of occurrence if it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate the amount of
the obligation can be made.
XVI. INFORMATION ON LIABILITIES REGARDING EMPLOYEE BENEFITS
Reserve for employee termination benefits
In accordance with existing Turkish Labour Law, the Bank is required to make lump-sum termination indemnities to each employee
who has completed one year of service with the Group and whose employment is terminated due to retirement or for reasons other
than resignation or as mentioned in related regislation. The computation of the liability is based upon the retirement pay ceiling
announced. The applicable ceiling amount as at 31 December 2014 is TL 3,438 (full TL) (31 December 2013: TL 3,254 (full TL)).
Reserve for employee termination benefits are calculated via net present value of estimated provision of probable liabilities will be
arised in the future and reflected in the financial statements.
The Bank reserved for employee severance indemnities in the accompanying unconsolidated financial statements using actuarial
method in compliance with the updated TAS 19-Employee Benefits. Accumulated all actuarial gains and losses in equity are
recognized in other capital reserves.
As at 31 December 2014 and 31 December 2013, the major actuarial assumptions used in the calculation of the total liability are as
follows:
Current Period
Prior Period
Discount Rate
2.84%
2.83%
Expected Rate of Salary/Limit Increase
5.00%
6.00%
Estimated Employee Turnover Rate
5.44%
5.42%
Other benefits to employees
The Bank has provided provision for undiscounted short-term employee benefits earned during the financial period as per services
rendered in compliance with the updated TAS 19-Employee Benefits in the accompanying unconsolidated financial statements.
XVII. INFORMATION ON TAX APPLICATIONS
Corporate tax
The corporate tax rate is 20%. Corporate tax rate is calculated on the total income of the Bank after adjusting for certain disallowable
expenses, exempt income and other allowances. No further tax is payable unless the profit is distributed.
Dividends paid to the resident institutions and the institutions working through local offices or representatives are not subject to
withholding tax. The withholding tax rate on the dividend payments other than the ones paid to the non-resident institutions generating
income in Turkey through their operations or permanent representatives and the resident institutions is 15%.