MILLI RE 2020 ANNUAL REPORT

Millî Reasürans Türk Anonim Şirketi (Currency: Turkish Lira (TL)) NOTES TO THE UNCONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2020 (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) 32 Operating expenses As of December 31, 2020, and 2019, the operating expenses are disclosed as follows: December 31, 2020 December 31, 2019 Life Non-Life Life Non-Life Commission expenses (Note 17) 11.053.130 387.829.656 9.867.612 345.377.032 Commissions to the intermediaries accrued during the period (Note 17) 12.443.367 399.522.378 10.073.409 384.781.658 Changes in deferred commission expenses (Note 17) (1.390.237) (11.692.722) (205.797) (39.404.626) Employee benefit expenses (Note 33) 873.527 64.273.901 727.446 58.694.997 Foreign exchange losses 177.897 100.100.735 84.022 30.104.524 Administration expenses 317.704 20.929.747 184.804 14.935.415 Commission income from reinsurers (Note 10) - (4.306.330) - (2.530.945) Commission income from reinsurers accrued during the period (Note 10) - (6.048.624) - (2.791.117) Change in deferred commission income (Note 10) - 1.742.294 - 260.172 Outsourced benefits and services 114.363 7.078.286 45.015 3.147.512 Other 40.286 10.157.952 24.363 14.779.995 Total 12.576.907 586.063.947 10.933.262 464.508.530 33 Employee benefit expenses As of December 31, 2020, and 2019, employee benefit expenses are disclosed as follows: December 31, 2020 December 31, 2019 Life Non-Life Life Non-Life Wages and salaries 623.085 47.827.749 513.595 42.928.532 Employer’s share in social security premiums 146.993 9.806.193 141.764 10.475.757 Pension fund benefits 103.449 6.639.959 72.087 5.290.708 Total (Note 32) 873.527 64.273.901 727.446 58.694.997 34 Financial costs As of December 31, 2020, TL 78.988 (1 January - 31 December 2019: 44.377) interest expense arising from leases that the Company is subject to TFRS 16 Leasing Transactions standard is recognised under “Investment Management Expenses - Interest Included” account; and the depreciation expense amounting to TL 1.657.154 is recognised under the “Depreciation and Amortization Expense” accounts (1 January - 31 December 2019: 1.463.920). Activities and Major Developments Related to Activities General Information Financial Rights Provided to the Members of the Governing Body and Senior Executives Research & Development Activities Milli Re Annual Report 2020 152