MILLI REASURANS ANNUAL REPORT 2018

Millî Reasürans Türk Anonim Şirketi NOTES TO THE UNCONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2018 (Currency: Turkish Lira (TL)) (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) December 31, 2017 Carrying amount Up to 1 month 1 to 3 months 3 to 6 months 6 to 12 months Unallocated Cash and cash equivalents 1.223.132.413 1.044.972.385 159.957.933 18.202.095 - - Financial assets (*) 378.829.902 371.329.322 - - 1.815.693 5.684.887 Receivables from main operations 176.061.654 91.045.359 14.963.790 4.487.761 65.564.744 - Other receivables and current assets 13.036.577 12.693.841 - - 342.736 - Total monetary assets 1.791.060.546 1.520.040.907 174.921.723 22.689.856 67.723.173 5.684.887 Financial liabilities and other liabilities 3.032.087 3.032.087 - - - - Payables arising from main operations 36.392.472 25.518.507 6.634.956 4.239.009 - - Due to related parties 106.310 106.310 - - - - Insurance technical reserves (**) 930.925.695 - - - - 930.925.695 Provisions for taxes and other similar obligations 8.574.495 8.574.495 - - - - Provisions for other risks and expense accruals 52.550.241 1.787.580 3.133.995 - - 47.628.666 Total monetary liabilities 1.031.581.300 39.018.979 9.768.951 4.239.009 - 978.554.361 (*) Equity shares amounting to TL 72.250.946 are not included. (**) Net of outstanding claims reserve not subject to consistent distribution is presented in the “unallocated” column. Market risk Market risk is the risk that changes in market prices, such as interest rate, foreign exchange rates and credit spreads will affect the Company’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return on risk. Foreign currency risk The Company is exposed to foreign currency risk through insurance and reinsurance transactions in foreign currencies. Foreign exchange gains and losses arising from foreign currency transactions are recorded at transaction dates. At the end of the reporting periods, foreign currency assets and liabilities evaluated by the Central Bank of Republic of Turkey’s spot purchase rates and the differences arising from foreign currency rates are recorded as foreign exchange gain or loss in the statement of operations. Millî Reasürans Annual Report 2018 128 / Unconsolidated Financial Statements and Independent Auditors’ Report