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FINANCIAL HIGHLIGHTS AND RISK MANAGEMENT
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TÜRKİYE VAKIFLAR BANKASI TÜRK ANONİM ORTAKLIĞI AND ITS FINANCIAL SUBSIDIARIES
CONSOLIDATED FINANCIAL REPORT AS AT AND
FOR THE YEAR 31 DECEMBER 2014
(Amounts expressed in thousands of Turkish Lira (“TL”) unless otherwise stated.)
CONVENIENCE TRANSLATION OF PUBLICLY ANNOUNCED CONSOLIDATED FINANCIAL STATEMENTS ORIGINALLY ISSUED IN TURKISH, SEE IN NOTE I. OF SECTION THREE
XIII. INFORMATION ON TANGIBLE ASSETS
The costs of the tangible assets purchased before 31 December 2004 are restated from the purchasing dates to 31 December 2004, the date the
hyperinflationary period is considered to be ended. The tangible assets purchased after this date are recorded at their historical costs. Tangible assets purchased
after 1 January 2005 are recorded at their historical costs after deducting financing expenses and foreign exchange differences if any.
Gains and losses arising from the disposal of the tangible assets are calculated as the difference between the net book value and the net sales price.
Maintenance and repair costs incurred for tangible assets are recorded as expense.
There are no restrictions such as pledges, mortgages or any other restriction on tangible assets.
Depreciation rates and estimated useful lives are:
Tangible assets
Estimated useful lives (years)
Depreciation Rates (%)
Buildings
50
2
Office equipment, furniture and fixture, and vehicles
5-10
10-20
Assets obtained through finance leases
4-5
20-25
There are no changes in the accounting estimates that are expected to have an impact in the current or subsequent periods.
At each reporting sheet date, the Group evaluates whether there is objective evidence of impairment on its assets. If there is an objective evidence of
impairment, the asset’s recoverable amount is estimated in accordance with the TAS 36-Impairment of Assets and if the recoverable amount is less than the
carrying value of the related asset, a provision for impairment loss is made.
XIV. INFORMATION ON INVESTMENT PROPERTIES
Investment property is a property held either to earn rental income or for capital appreciation or for both. Group held investment property with respect to the
consolidated real estate investment and insurance firms’ activities.
Investment properties are initially recorded at their acquisition costs including transaction costs.
Investment properties, following the initial recording, are measured by acquisition cost method (reducing accumulated depreciation and if it is present,
provisions for impairment from acquisition cost) that is used in tangible assets.
XV. INFORMATION ON LEASING ACTIVITIES
Finance leasing activities as the lessee
Tangible assets acquired through finance leasing are recognized in tangible assets and the obligations under finance leases arising from the lease contracts
are presented under “Finance Lease Payables” account in the consolidated balance sheet of the Group. In the determination of the related asset and liability
amounts, the lower of the fair value of the leased asset and the present value of leasing payments is considered. Financial costs on leasing agreements are
expanded in lease periods at a fixed interest rate.
If there is impairment in the value of the assets obtained through finance lease and in the expected future benefits, the leased assets are valued with net
realizable value. Depreciation for assets obtained through finance lease is calculated in the same manner as tangible assets.
Finance leasing activities as the lessor
The rent amounts at the beginning of the finance leasing activities are recorded at “finance lease receivables” account in gross amounts comprising the
principal amounts and interests. The interest, the difference between the total of rent amounts and the cost of the fixed assets, is recorded at “unearned
income” account. As the rents are collected, “finance lease receivables” account is decreased by the rent amount; and the interest component is recorded at
consolidated income statement as interest income.