MILLIRE ENG2024

2.1.2 Other related accounting policies appropriate for the understanding of the financial statements Other accounting policies The Company records premium, commission and compensation accruals based on notifications made to it by insurance and reinsurance companies, and since these notifications are received with a delay due to the closing of their own accounts by the ceding companies in question; written premiums, compensation and commission accruals are recognized in the Company’s financial statements with a 3-month delay. Therefore, the amounts included in the financial statements for the income statement items in question consist of the amounts for the three-month accounting period between September 30 - December 31, 2023 and the nine-month period ending January 1 - September 30, 2024, and the balance sheet items directly related to them do not reflect the actual situation as of December 31, 2024 due to this delay. However, in its letter addressed to the Company dated 31 August 2010 and numbered B.02.1.HZN.0.10.03.01/42139, the Ministry of Treasury and Finance of the Republic of Turkey stated that there may be some delays in the sending of account statements of ceding companies to reinsurance companies and that the issues regarding reinsurance companies in the regulations previously published by the Ministry of Treasury and Finance of the Republic of Turkey were determined by taking this situation into consideration. Information regarding other accounting polices is disclosed above in “ Note 2.1.1 - Information about the principles and the specific accounting policies used in the preparation of the financial statements” and each under its own caption in the following sections of this report. 2.1.3 Valid and presentation currency The accompanying consolidated financial statements are presented in TRY, which is the Group’s valid reporting currency 2.1.4 Rounding scale of the amounts presented in the financial statements Financial information presented in TL, has been rounded to the nearest TL values. 2.1.5 Basis of measurement used in the preparation of the financial statements The accompanying consolidated financial statements are prepared on the historical cost basis as adjusted for the effects of inflation that lasted until December 31, 2004, except for the financial assets at fair value through profit or loss, available-for-sale financial assets, derivative financial instruments, self-used buildings and investment properties recorded in tangible assets and associates which are measured at their fair values unless reliable measures are available 2.1.6 Accounting policies, changes in accounting estimates and errors Accounting of fire and earthquake premiums obtained from foreign reinsurance treaties on the basis of branches Fire and earthquake premiums obtained from foreign reinsurance treaties could not accounted on the basis of branches in the previous years due to limitations imposed by local legislation of the foreign countries, notification characteristics of the treaties and total premiums used by foreign companies in the reconciliation process. Therefore, all premiums obtained from aforementioned treaties are accounted on the fire branch. According to the letter dated August 2, 2011 and numbered B.02.1.HZN.0.10.03.01/38732 sent by the Republic of Turkey Ministry of Treasury and Finance to the Company, it is allowed to use average rate calculated over separately reported fire and earthquake premiums for unclassified premiums of proportioned treaties. Furthermore, according to the letter dated August 12, 2011 sent by the Republic of Turkey Ministry of Treasury and Finance to the Company, prospective application as at June 30, 2011 effective from January 1, 2011 is allowed since retrospective application is impossible. Accordingly, financial statements prepared As of December 31, 2024, premiums obtained from foreign proportioned treaties are accounted on the basis of average earthquake premium ratio calculated from foreign proportioned treaties over the period of January 1, 2023 - December 31, 2023. The same ratio is used for unproportioned reinsurance treaties in accordance with the Communiqué released on July 28, 2010 and numbered 27655 “Communiqué on Amendments to Communiqué on Technical Reserves for Insurance, Reinsurance and Pension Companies and the Related Assets That Should Be Invested Against Those Technical Reserves”. Distribution of commissions and claims between the fire and earthquake branches is parallel with the aforementioned method. 197 2024 Annual Report Millî Reasürans Türk Anonim Şirketi (Currency: Turkish Lira (TL)) Notes to the Consolidated Financial Statements As of December 31, 2024 (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish) GENERAL INFORMATION FINANCIAL RIGHTS PROVIDEDTOTHE MEMBERS OF THE GOVERNING BODY AND SENIOR EXECUTIVES RISKS AND ASSESSMENT OF THE GOVERNING BODY ACTIVITIES AND MAJOR DEVELOPMENTS RELATED TO ACTIVITIES RESEARCH & DEVELOPMENT ACTIVITIES FINANCIAL STATUS FINANCIAL INFORMATION