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FINANCIAL INFORMATION
CONVENIENCE TRANSLATION OF PUBLICLY ANNOUNCED UNCONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN TURKISH, SEE NOTE I OF SECTION THREE
ARAP TÜRK BANKASI ANONİM ŞİRKETİ
NOTES TO UNCONSOLIDATED FINANCIAL STATEMENTS
AT 31 DECEMBER 2015
(AMOUNTS EXPRESSED IN THOUSANDS OF TURKISH LIRA (“TL”) UNLESS OTHERWISE STATED. )
Interest and exchange rate expenses related to financial leasing are recognized in the income statement. The Bank does
not provide financial leasing services as a lessor.
Operational leases
Transactions regarding operational lease agreements are accounted on an accrual basis in accordance with the terms of
the related contracts.
Lease payments made under operational leases are recognized in the income statement over the lease term in equal
installments.
XV. INFORMATION ON PROVISIONS, 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 Labor Law, the Bank is required to make lump-sum termination indemnities to each
employee who has completed one year of service with the Bank and whose employment is terminated due to retirement
or for reasons other than resignation or as mentioned in related legislation. The computation of the liability is based
upon the retirement pay ceiling announced. The applicable ceiling amount as at 31 December 2015 is TL 3,828 (full TL)
(31 December 2014: TL 3,438 (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 2015 and 31 December 2014, the major actuarial assumptions used in the calculation of the total
liability are as follows:
Current Period
Prior Period
Discount Rate
%3.12
%2.84
Expected Rate of Salary/Limit Increase
%7.56
%5.00
Estimated Employee Turnover Rate
%5.30
%5.44
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 in the accompanying unconsolidated financial statements.