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Notes to the consolidated financial statements

as of December 31, 2016

(All amounts expressed in Turkish Lira (“TL”))

Finansal Kiralama, Faktoring ve Finansman Şirketleri Birliği ve Bağlı Ortaklıkları

Finansal Kiralama, Faktoring ve Finansman Şirketleri Birliği Finansal Kiralama İktisadi İşletmesi

was established on February

27, 2014. The Financial Leasing Commercial Enterprise’s purpose and scope are as follows:

a. Making necessary investments according to Financial Leasing, Factoring and Financing Companies Law numbered 6361, Article 21,

22 for the establishment of the system related to registration process,

b. Making operational and personnel expenses for the system to run on a regular basis

c. Performing all kind of activities in order to generate service revenue from registration process,

d. Organizing trainings, conferences, publications and consulting activities regarding the registration process,

e. Investing the revenue collected as a result of financial activities and depositing the revenue to the bank accounts that are deemed

appropriate, being authorized for such actions,

Approval of consolidated financial statements:

The consolidated financial statements prepared related to the accounting period which end up on December 31, 2016 have been

approved by the Board of Directors of the Group on March 9, 2017 and are going to be summited for approval in the General

Assembly Meeting that will be held in April 2017. In the framework of the legislation, the Group’s authorized Boards and the

regulatory institutions have the authority to alter financial statements.

2. Basis of presentation of financial statements

A. Explanations on basis of presentation

Applied accounting standards

The Group holds its legal books in accordance with the Turkish Commercial Code no. 6102, tax legislation and the Uniform Chart of

Accounts published by the Ministry of Finance.

The Group is responsible for accounting for all transactions in line with the principles and procedures set by the Board of Public

Oversight, Accounting and Auditing Standards in accordance and has to prepare its financial reports in a timely and accurate manner

that is understandable, reliable and comparable, timely, analytical and interpretable in form and content to meet the need for

information.

In the preparation of the financial statements and footnotes, “Financial Statements and Examples Use Guide” principles has been used

which was announced by the POA as of April 20, 2013.

The financial statements are based on the Group’s legal records and represented with TRY balances and they have been subjected to

certain adjustments and classifications in order to properly present the position of the Group which have been published by the Public

Oversight Accounting and Auditing Standards.

Functional and presentation currency of the Group is TL.

Netting / Offset

With all kinds of significant financial amounts, even with similar characteristics, are presented separately in the financial statements

Not significant amounts are material or shown in terms of consolidating as similar items. As a result of the transaction and to make

the event the necessary offsetting these transactions and the net amount of the event or the presence of the monitoring over the

amount after impairment losses is not considered a violation of the rule of offsetting. As a result of the transactions in the normal

course of business of the Group, and income earned, in that the nature of the transaction or event is presented as net value provided

Basis of consolidation

The Association and the subsidiaries are included in the consolidated financial statements.

Consolidated financial statements include the financial statements of the Group and its subsidiaries as of December 31, 2016.

The balance sheet prepared in accordance with the Turkish Financial Reporting Standards (“TFRS”) of the subsidiaries has been

consolidated with the Association’s balance sheet.

81

The Association of Financial Institutions

Annual Report 2016