CELEBI GROUND HANDLING ANNUAL REPORT 2018

43 Çelebi Ground Handling 2018 Annual Report Güney Bağımsız Denetim ve SMMM A.Ş. Eski Büyükdere Cad. Orjin Maslak No.27 Maslak, Sarıyer 34398 İstanbul-Turkey Tel: +90 212 315 3000 Fax: +90 212 230 8291 ey.com Ticaret Sicil No: 479920 Mersis No: 0-4350-3032-6000017 Key Audit Matter How the key audit matter is handled in the audit The operations of Istanbul Atatürk International Airport (“Atatürk Airport”) will be terminated with the opening of Istanbul Airport As explained in Note 1 in the accompanying consolidated financial statements as of December 31, 2018, the parent company, Çelebi Hava Servisi Anonim Şirketi, provides ground handling services, cargo services, and warehouse operations services for domestic and foreign airlines and private cargo companies at Atatürk Airport. As explained in Note 11 in the accompanying consolidated financial statements as of December 31,2018, a tender for the construction of the third airport was made in Istanbul on May 3, 2013. As a result of the aforementioned tender, it is announced that the commercial flights made from Atatürk Airport will be terminated upon the new airport’s operation and the Company will continue its activities at the new airport. In accordance with the assumption that the ground handling services to be provided by the Group to commercial passenger aircraft at the Atatürk Airport will end within the first quarter of 2019, the Group has reviewed the useful lives of the property, plant and equipment classified as leasehold improvements in the related station and decided to amortize the remaining net book value in accordance with the assumptions. The effect of the usefullife estimate change on net profit for the year is TL 21.130.026 as expense. Additionally, as stated in Note 11 in the accompanying consolidated financial statements as of December 31, 2018, the Company has construction in progress amounting to TL 154.531.497 for Istanbul Airport. The effect of change in accounting estimate for aforementioned leasehold improvements in Atatürk Airport and new investments for Istanbul Airport to consolidated financial statements of the Group is determined as key audit matter. The audit procedures we performed include; analysis of the property, plant and equipment in immovable asset at Atatürk Airport, assessment of the significance of the net book values of these property, plant and equipment in terms of the Group’s consolidated financial statements as of December 31, 2018 and a recalculation of the effects of the change in accounting estimates. Additionally, review of the nature ofinvestments made for Istanbul Airport and testing ofinvoices on a sampling basis are included in the audit procedures.