MILLIRE_2019_Annual Report

246 Milli Re Annual Report 2019 Millî Reasürans Türk Anonim Şirketi NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2019 (Currency: Turkish Lira (TL)) (Convenience Translation of Financial Statements and Related Disclosures and Footnotes Originally Issued in Turkish, See Note 2.1.1) As at December 31, 2019 and 2018, “Other Reserves and Retained Earnings” are detailed as below: December 31, 2019 December 31, 2018 Other profit reserves 24.424.400 24.481.758 Extraordinary reserves 588.605.356 284.629.618 Other capital reserves 165.814.989 163.749.852 Sales profits to be capitalized 24.245.511 24.245.511 Other earnings and losses (2.758.065) (2.073.808) Subsidiary capital correction (71.060.049) (71.060.049) Total 729.272.142 423.972.882 Other capital reserves According to TAS 16 - “Property Plant and Equipment”, property, plant and equipment are initially recorded at cost and can be subsequently measured at their fair values. The Company has started to show based on the revaluation model by measuring over fair value as of the third quarter of 2015 by making changes in the use of the property which is measuring the cost model in the financial statements before. In accordance with tax legislation, 75% of profits from sales of participation shares and 50% of profits from sales real estates included in the assets of companies is exempt from corporate tax provided that it is classified under a special fund for full five years. The exempt gains cannot be transferred to another account other than a capital increase or cannot be withdrawn from the entity for five years.. Anadolu Sigorta, as of December 31, 2019, the tax exempt which obtained thanks to sale of participation shares and real estate in 2010, 2011, 2013, 2014, 2015, 2016 and 2017 years respectively, amounting to TL 8.081.516, TL 80.025, TL 647.763, TL 920.272, TL 2.541.500, TL 15.094 and TL 838.049 and real estate revaluation funds of 2018 and 2019 and the profit not subject to distribution for 2018 are classified as other capital reserves. Milli Reasürans, according to expertise reports, fair value of property for use is calculated as TL 179.340.000 and revaluation differences amounting to TL 162.300.435 is recognized in ‘Other Capital Reserves’ account under equity as TL 146.070.394 with net tax effect in financial statements as of December 31, 2019 (December 31, 2018: TL 146.070.394). As of 31 December 2019, Non-Distributable Profit amount recognized according to the equity method is TL 19.744.595. (December 31, 2018: TL 17.679.458). Extraordinary reserves The movement of extraordinary reserves is as follows: December 31, 2019 December 31, 2018 Extraordinary reserves at the beginning of the period 284.629.618 179.927.446 Transfer from profit 303.975.738 104.702.172 Extraordinary reserves at the end of the period 588.605.356 284.629.618