5 - TPAO

58
The Group does not have a goodwill account
under the TFRS 3 “Business Combinations.”
2.5 Impairment Of Assets
In case the carrying values of assets exceed
the estimated recoverable amount, the assets
or cash-generating units are written down to
their recoverable amount and the provision
is reflected to the income statement as an
expense.
On the other hand; the recoverable amount of
assets is the greater of net selling price and
value in use. In assessing value in use, the
estimated future cash flows are discounted to
their present value using a pre-tax discount
rate that reflects current market assessments
of the time value of money and the risks
specific to the asset.
No such case is detected at the balance sheet
period.
2.6 Borrowing Costs
The financing costs arising due to financial
debts are included in the cost amount of
qualifying assets when associated with the
acquisition or establishment of qualifying
assets. Qualifying assets refers to assets that
take a substantial period of time to get ready
for its intended use or sale. Other borrowing
costs are recorded in the income statement in
the period they arise.
2.7 Financial Instruments
Financial instruments consist of following
financial assets and liabilities;
Cash and Cash Equivalents
Cash and cash equivalents comprise cash on
hand, cash in banks and cash in transit.
Cash on hand comprise Turkish Liras and
foreign currency balances Turkish Liras
balances are carried at cost, foreign currency
balances are carried at their TL equivalent
values calculated using the buying exchange
rates announced by Central Bank of the
Republic of Turkey at the balance sheet
date. Buying rates are used for evaluating
foreign currencies in assets and Selling rates
are used for evaluating foreign currencies in
liabilities.
Bank deposits comprise time and demand
deposits and interests of these deposits.
Turkish Liras balances are carried at cost,
foreign currency balances are carried at their
TL equivalent values calculated using the
buying exchange rates announced by Central
Bank of the Republic of Turkey at the balance
sheet date.
Due to the fact that the liquid assets in foreign
currency are exchanged to the Turkish Liras
in effective rate in balance sheet date, the
fair value of these assets are accepted to be
equivalent to their registered value. Cash
and cash equivalents in foreign currencies
are translated to Turkish Liras using the
exchange rates at the balance sheet date.
Thus, fair values of these assets are accepted
to be equal to their book values.
Bank Deposits, checks received and
registered value of cash are assumed to
be equal with their fair values as they are
disposed of in short terms and free of the risk
of impairment.
Fair value is the amount at any financial
instruments, between two purchased and
saled parts, that has been changed of hands
as cleaned from collusion, primarily, stock
market value of relevant asset, in case the
lack of stock market value the purchase and
sale value which is suitable for the definition
is being accepted as fair value.
Trade Receivables
Trade receivables are financial assets
recognized by direct sale of goods and
services to buyers.
Discounted and doubtful receivable provision