MILLI REASURANS ANNUAL REPORT 2018

Millî Reasürans Türk Anonim Şirketi NOTES TO THE CONSOLIDATED 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) Restatements of the detailed income statement as of January 1 to December 31, 2017 Detailed Income Statement Previously Reported Restated Effects (*) January 1 - January 1 - December 31, 2017 December 31, 2017 K- Investment Income 1.136.476.415 1.136.625.775 149.360 B 6- Income from Subsidiaries and Joint Ventures 4.544 153.904 149.360 B N- Net Profit/ (Loss) 274.328.870 274.478.230 149.360 B 1- Profit/(Loss) Before Tax 371.096.783 371.246.143 149.360 B 3.1- Groups Profit/(Loss) 189.520.109 189.669.469 149.360 B (*) The effects of the restatements are described in paragraphs A and B below. Restatement of the detailed balance sheet as of January 01, 2017: Detailed Balance Sheet Previously Reported Restated Effects (*) January 01, 2017 January 01, 2017 II- Non-Current Assets 849.909.045 841.636.005 (8.273.040) A-B D- Financial Assets 183.088.026 185.042.700 1.954.674 B 4- Subsidiaries 1.092.707 3.047.381 1.954.674 B H- Other Non-current Assets 10.227.714 - (10.227.714) A 5- Deferred Tax Assets 10.227.714 - (10.227.714) A III- Short-Term Liabilities 5.988.373.913 5.882.992.846 (105.381.067) A E- Insurance Technical Reserves 5.154.029.795 5.048.648.727 (105.381.068) A 2- Unexpired Risk Reserves - Net 12.888.197 5.051.590 (7.836.607) A 4- Outstanding Claims Reserve - Net 3.005.627.300 2.908.082.839 (97.544.461) A IV- Long-Term Liabilities 208.888.988 219.737.488 10.848.500 A I- Other Long Term Liabilities - 10.848.500 10.848.500 A 1- Deferred Tax Liability - 10.848.500 10.848.500 A V- Equity 1.759.727.839 1.845.987.367 86.259.528 A-B C- Profit Reserves 165.559.918 168.126.641 2.566.723 B 1- Legal Reserves 90.232.526 90.368.834 136.308 B 6- Other Profit Reserves 23.381.673 25.812.088 2.430.415 B D- Previous Years’ Profits 197.937.817 266.499.308 68.561.491 A-B 1- Previous Years’ Profits 197.937.817 266.499.308 68.561.491 A-B F- Net Profit of the Period 181.244.361 196.375.675 15.131.314 A-B 1- Net Profit of the Period 181.235.711 196.367.025 15.131.314 A-B (*) The effects of the restatements are described in paragraphs A and B below. A. Effects of restatements according to the Circular 2017/7 announced by the Republic of Turkey Ministry of Treasury and Finance are as follows With the Circular 2017/7 announced by the Republic of Turkey Ministry of Treasury and Finance regarding “the discount of net cash flow from outstanding claim files”. Since the discount of “Land Vehicle Liability” and “General Liability” branches hasbecome compulsory according to theArticle 1 of the circular, this is considered as a change of accounting policies and financial statements have been retrospectively restated. Companies are able to discount net cash flow from outstanding claim files according to the methods outlined by the circular. B. “Impact of amendments regarding TAS 27 - “Consolidated and Separate Financial Statements” Miltaş Turizm İnşaat Ticaret A.Ş., which is a subsidiary of the company, is not covered by the scope of full certification since total assets of the aforementioned subsidiary is less than one percent of total assets of the Company in the framework of exemption, foreseen in the Communique on Consolidation, and financial statements of Miltaş have been recognized in accordance with equity method. Millî Reasürans Annual Report 2018 Consolidated Financial Statements and Independent Auditors’ Report / 181