VKF_FRAE_2018_uyg11

VakıfBank Annual Report 2018 361 CONVENIENCE TRANSLATION OF PUBLICLY ANNOUNCED CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN TURKISH, SEE IN NOTE I. OF SECTION THREE TÜRKİYE VAKIFLAR BANKASI TÜRK ANONİM ORTAKLIĞI AND ITS FINANCIAL SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2018 (Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated.) In addition to the ‘payables to participants’ account, mentioned in the previous paragraph, individual pension system payables also includes participants’ temporary accounts, and payables to individual pension agencies. The temporary account of participants includes the contributions of participants that have not yet been invested. Individual pension system payables are presented under other liabilities and provisions in the accompanying consolidated financial statements. Fees received from individual pension business consist of investment management fees, fees levied on contributions and entrance fees. Fees received from individual pension business are recognized in other income in the accompanying consolidated statement of comprehensive income. Classifications Reclassification procedures in scope of TFRS 9 are stated below. TFRS 9 Finacial Instruments implementation and effects TFRS 9 “Financial Instruments”, which is effective as of January 1, 2018 is published by the Public Oversight Accounting and Auditing Standards Authority (“POA”) in the Official Gazette numbered 29953 dated January 19, 2017. TFRS 9 will replace TAS 39 Financial Instruments: recognition and measurement, related to the classification and measurement of financial instruments. TFRS 9 sets out the new principles for the classification and measurement of financial instruments, impairment for credit risk on financial assets and general hedge accounting. Classification and measurement of financial instruments According to TFRS 9 requirements, classification and measurement of financial assets will depend on the business model within which financial assets are managed and their contractual cash flow characteristics whether the cash flows represent “Solely Payments of Principal and Interest” (SPPI). Before TFRS 9 In Scope of TFRS 9 Financial Assets Measurement Bases Book Value December 31, 2017 Measurement Bases Book Value January 1, 2018 Cash Balances and Central Bank Measured at amortized cost 28,656,246 Measured at amortized cost 28,656,246 Banks and Money Markets Measured at amortized cost 14,982,861 Measured at amortized cost 14,982,861 Marketable Securities Fair value through profit and loss 129, 972 Fair value through profit and loss 173,342 Fair value through other comprehensive income (Available-for-sale) 14,570,384 Fair value through other comprehensive income 7,072,487 Measured at amortized cost (Investments held to maturaty) 16,766,071 Measured at amortized cost 24,422,643 Derivative Financial Assets Held-for-trading Fair value through profit and loss 1,946,251 Fair value through profit and loss 1,946,251 Loans (Gross) Measured at amortized cost 185,442,530 Measured at amortized cost 185,442,530