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CONVENIENCE TRANSLATION OF THE INDEPENDENT AUDITOR’S
REPORT ORIGINALLY PREPARED AND ISSUED IN TURKISH
To the Board of Directors of Arap Türk Bank A.Ş.
Report on Consolidated Financial Statements
We have audited the accompanying consolidated balance sheet of Arap Türk Bank A.Ş. (“the Bank”) and its consolidated subsidiary at 31 December 2015 and the related
consolidated statements of income, consolidated income and expense items under the shareholders’ equity, consolidated statement of changes in the shareholders’ equity,
consolidated cash flows for the year then ended and a summary of significant accounting policies and other explanatory notes to the financial statements.
Management’s Responsibilities for Consolidated Financial Statements
The Bank management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the “Regulation on the Procedures and
Principles Regarding Accounting Applications for Banks and Safeguarding of Documents”, published in Official Gazette No. 26333 dated 1 November 2006, other regulations
published by the Banking Regulation and Supervision Agency (“BRSA”) on accounting records of Banks, interpretations and circulars published by BRSA and the provisions of
Turkish Accounting Standards for the matters which are not regulated by the aforementioned legislations; “BRSA Accounting and Financial Reporting Legislation” and for such
internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Independent Auditor’s Responsibility
Our responsibility is to express an opinion on the consolidated financial statements based on our audit. We conducted our audit in accordance with Communique “Independent
Audit of Banks” published by BRSA on the Official Gazette No. 29314 dated 2 April 2015 and with the Independent Auditing Standards which is a part of Turkish Auditing
Standards promulgated by the Public Oversight Accounting and Auditing Standards Authority (“POA”). Those standards require that we comply with ethical requirements and
plan and perform the audit to obtain reasonable assurance as to whether the consolidated financial statements are free of material misstatements.
An independent audit includes performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures
selected depend on the independent auditor’s professional judgment, including the assessment of risks of material misstatement of the consolidated financial statements,
whether due to fraud or error. In making those risk assessments, the independent auditor considers the internal control relevant to Bank’s preparation and fair presentation of
the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Bank’s internal control. An independent audit also includes evaluating the appropriateness of accounting policies used by the reasonableness of accounting
estimates made by the management as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we obtained during the independent audit provides a sufficient and reasonable basis for our opinion.
Basis for the Qualified Opinion
As in Section II. Note 7 of Explanations and Notes to the Consolidated Financial Statements, as of the balance sheet date the accompanying consolidated financial statements
include a free provision amounting to TL 9,000 thousand which was charged to the income statement as an expense in 2014 provided by the Bank’s management in line with
the conservatism principle in considering the circumstances that may arise from any changes in the economy or market conditions.
Opinion
In our opinion, except for the effect of the matter described in the “Basis for the qualified opinion” paragraph above, on the consolidated financial statements, the consolidated
financial statements present fairly, in all material respects, the financial position of Arap Türk Bank A.Ş. and its consolidated subsidiary as at 31 December 2015, and the results of
its operations and its cash flows for the year that ended in accordance with the BRSA Accounting and Financial Reporting Legislation.
Reports on Other Responsibilities Arising from Regulatory Requirements
In accordance with Article 402, paragraph 4 of Turkish Commercial Code No. 6102 (“TCC”), no significant matter has come to our attention that causes us to believe that the
Bank’s bookkeeping activities for the period 1 January - 31 December 2015 are not in compliance with TCC and provisions of the Bank’s articles of association in relation to
financial reporting.
In accordance with Article 402, paragraph 4 of the TCC, the Board of Directors submitted to us the necessary explanations and provided required documents within the context
of audit.
Additional Paragraph for the Convenience of Translation
As explained in Note I of Section Three, the effects of the differences between accounting principles and standards set out by regulations in conformity with BRSA Accounting
and Financial Reporting Legislation, the accounting principles generally accepted in countries in which the accompanying financial statements are to be distributed and the
International Financial Reporting Standards (“IFRS”) have not been quantified in the accompanying financial statements. Accordingly, the accompanying financial statements
are not intended to present the financial position, results of operations and changes in financial position, and cash flows in accordance with the accounting principles generally
accepted in such countries and by the IFRS.
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Serbest Muhasebeci Mali Müşavirlik A.Ş.
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Istanbul, 28 January 2016