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Türkiye Vakıflar Bankası Türk Anonim Ortaklığı
and Its Financial Subsidiaries Consolidated Financial Report as at and
For the Year Ended 31 December 2013
(Currency: Thousands of Turkish Lira (“TL”))
Convenience Translation of the Consolidated Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Section 3 Note I
Associates and subsidiaries
The financial subsidiaries of the Group are consolidated in the accompanying consolidated financial statements and non-financial subsidiaries are
accounted for in accordance with TAS 39–
Financial Instruments: Recognition and Measurement
.
In the accompanying consolidated financial statements, financial associates of the Group, whose total assets, and net operating profit/(loss) individually
or as a whole are significant are accounted with equity method and whose total assets and net operating profit/(loss) and or as a whole are significant
and non-finance associates are accounted for in accordance with TAS 39–
Financial Instruments: Recognition and Measurement
together with non-
financial associates in the accompanying consolidated financial statements.
VIII. Information on impairment of financial assets
Financial assets or group of financial assets are reviewed at each balance sheet date to determine whether there is objective evidence of impairment. If
any such indication exists, the Group estimates the amount of impairment.
Impairment loss incurs if, and only if, there is objective evidence that the expected future cash flows of financial asset or group of financial assets
are adversely affected by an event(s) (loss event(s)) incurred subsequent to recognition. The losses expected to incur due to future events are not
recognized even if the probability of loss is high.
If there is an objective evidence that certain loans will not be collected, for such loans; the Bank provides specific and general allowances for loan and
other receivables classified in accordance with the Regulation on Identification of and Provision against Non-Performing Loans and Other Receivables
published on the Official Gazette no. 26333 dated 1 November 2006 and the amendments to this regulation. The allowances are recorded in the
statement of income of the related period.
IX. Information on netting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the balance sheet if, and only if, there is a currently enforceable
legal right of the Group to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the asset and settle the liability
simultaneously.
X. Information on sales and repurchase agreements and securities lending
Securities sold under repurchase agreements (“repo”) are recorded on the balance sheet. Government bonds and treasury bills sold to customers under
repurchase agreements are classified as “Securities Subject to Repurchase Agreements” and measured based on their original portfolio, either at fair
value or at amortized cost using the effective interest rate method. Funds received through repurchase agreements are classified separately under
liability accounts and the related interest expenses are accounted on an accrual basis.
Securities purchased under resale agreements (“reverse repo”) are classified under “Receivables from Interbank Money Markets” separately. An income
accrual is accounted for the positive difference between the purchase and resale prices earned during the period.
XI. Information on assets held for sale and discontinued operations
A tangible asset (or a disposal group) classified as “asset held for sale” is measured at lower of carrying value or fair value less costs to sell. An asset
(or a disposal group) is regarded as “asset held for sale” only when the sale is highly probable and the asset (disposal group) is available for immediate
sale in its present condition. For a highly probable sale, there must be a valid plan prepared by the management for the sale of asset including
identification of possible buyers and completion of sale process. Furthermore, the asset should be actively in the market at a price consistent with its fair
value.
A discontinued operation is a part of the Group’s business which is sold or classified as held-for-sale. The operating results of the discontinued
operations are disclosed separately in the consolidated income statement. The Group has no discontinued operations as at the balance sheet date.
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