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) These amendments are applied for annual periods beginning on or after 1 January 2018. The amendments did not have a significant impact on the financial position or performance of the Group. TFRIC 22 Foreign Currency Transactions and Advance Consideration The interpretation issued by POA on December 19, 2017 clarifies the accounting for transactions that include the receipt or payment of advance consideration in a foreign currency. The Interpretation states that the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income is the date on which an entity initially recognises the non-monetary asset or non-monetary liability arising from the payment or receipt of advance consideration. An entity is not required to apply this Interpretation to income taxes; or insurance contracts (including reinsurance contracts) it issues or reinsurance contracts that it holds. The interpretation is effective for annual reporting periods beginning on January 1, 2018. The Group is in the process of assessing the impact of the interpretation on financial position or performance of the Group. TFRS 2 Classification and Measurement of Share-based Payment Transactions (Amendments) In December 2017, POA issued amendments to TFRS 2 Share-based Payment, clarifying how to account for certain types of share- based payment transactions. The amendments, provide requirements on the accounting for: a. the effects of vesting and non-vesting conditions on the measurement of cash-settled share-based payments; b. share-based payment transactions with a net settlement feature for withholding tax obligations; and c. a modification to the terms and conditions of a share-based payment that changes the classification of the transaction from cash- settled to equity-settled. These amendments are applied for annual periods beginning on or after 1 January 2018. The amendments are not applicable for the Group and did not have an impact on the financial position or performance of the Group. TAS 40 Investment Property: Transfers of Investment Property (Amendments) In December 2017, POA issued amendments to TAS 40 ‘Investment Property ‘. The amendments state that a change in use occurs when the property meets, or ceases to meet, the definition of investment property and there is evidence of the change in use. These amendments are applied for annual periods beginning on or after 1 January 2018. The amendments are not applicable for the Group and did not have an impact on the financial position or performance of the Group. Annual Improvements to TFRSs - 2014-2016 Cycle In December 2017, POA issued Annual Improvements to TFRS Standards 2014-2016 Cycle, amending the following standards: -- TFRS 1 “Initial Implementation of International Financial Reporting Standards”: This amendment has abolished short term exemptions of certain TFRS 7 disclosures, TAS 19 transition provisions and TFRS 10 Investment Enterprises. Amendment is applicable for annual accounting periods, starting on and after January 1, 2018. -- TAS 28 Investments in Associates and Joint Ventures: This amendment clarifies that the election to measure an investment in an associate or a joint venture held by, or indirectly through, a venture capital organisation or other qualifying entity at fair value through profit or loss applying TFRS 9 Financial Instruments is available for each associate or joint venture, at the initial recognition of the associate or joint venture. These amendments are applied for annual periods beginning on or after 1 January 2018. The amendments are not applicable for the Company and did not have an impact on the financial position or performance of the Company. ii) Standards issued but not yet effective and not early adopted Standards, interpretations and amendments to existing standards that are issued but not yet effective up to the date of issuance of the financial statements are as follows. The Group will make the necessary changes if not indicated otherwise, which will be affecting the financial statements and disclosures, when the new standards and interpretations become effective. Millî Reasürans Annual Report 2018 200 / Consolidated Financial Statements and Independent Auditors’ Report