Notes to the Unconsolidated Financial Statements for the Year Ended
31 December 2012
The related assets are amortized by the straight-line method in 1-3 years. The amortization method and period are periodically reviewed at
the end of each year.
XIII. Tangible Assets
Tangible assets purchased before 1 January 2005, are presented in the financial statements at their inflation adjusted acquisition costs as
at 31 December 2004, and the items purchased in the subsequent periods are presented at acquisition costs less accumulated amortization
and impairment provisions. In case there is an indication of impairment, the recoverable amount of the related intangible asset is estimated
within the framework of “TAS 36 – Impairment of Assets” and impairment provision is set aside in case the recoverable amount is below its
acquisition cost.
Assets under construction for leasing or for administrative purposes or for other objectives, which are not presently determined, are
amortized when they are ready for use.
The acquisition costs of tangible assets other than the land and construction in progress are amortized by the straight-line method,
according to their estimated useful lives. The estimated useful life, residual amount and the method of amortization are reviewed every
year for the possible effects of the changes that occur in the estimates and if there is any change in the estimates, they are recognized
Assets acquired through finance lease are amortized at the estimated useful life or the leasing period, whichever is shorter.
Costs of operational lease development are amortized at equal amounts considering the period of benefit. Yet, in any case, the period
of benefit cannot exceed the period of lease. In case the period of lease is indefinite or longer than 5 years, the amortization period is
considered to be 5 years.
The difference between the sales proceeds arising from the disposal of tangible assets or the inactivation of a tangible asset and the book
value of the tangible assets are recognized in the income statement.
Regular maintenance and repair costs incurred for tangible assets are recorded as expense.
There are no restrictions such as pledges, mortgages on tangible assets.
The depreciation rates used in amortization of tangible assets and their estimated useful lives are as follows:
Estimated Economic Life (Year)
Depreciation Rate
Safe Boxes
Other Movables
Leased Assets
XIV. Leasing Transactions
Assets acquired under financial leases are carried at the lower of their fair values or amortized value of the lease payments. Leasing
payables are recognized as liabilities in the balance sheet while the interest payable portion of the payables is recognized as a deferred
amount of interest. Finance lease payments are separated as financial expense and principal amount payment, which provides a decrease
in finance lease liability, thus helps a fixed rate interest on the remaining principal amount of the debt to be calculated. Within the context
of the Bank’s general borrowing policy, financial expenses are recognized in the income statement. Assets held under financial leases are
recognized under the property, plant and equipment (movable properties) account and are depreciated by using the straight line method.
The Bank does not participate in the financial leasing transactions as a “lessor”.
Operational lease transactions are recognized in line with the related agreement on an accrual basis.
XV. Provisions and Contingent Liabilities
In the financial statements, a provision is made for an existing commitment resulted from past events if it is probable that the commitment
will be settled and a reliable estimate can be made of the amount of the obligation.
Provisions are calculated based on the best estimates of management on the expenses to incur as of the balance sheet date to fulfill the
liability by considering the risks and uncertainties related to the liability.
In case the provision is measured by using the estimated cash flows required to fulfill the existing liability, the book value of the related
liability is equal to the present value of the related cash flows.
If the amount is not reliably estimated and there is no probability of cash outflow from the Bank to settle the liability, the related liability is
considered as “contingent” and disclosed in the notes to the financial statements.
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