ÇELEBİ AR19-270720 (1)

44 Çelebi Ground Handling Inc. 2019 Annual Report INDEPENDENT AUDITORS’ REPORT Key Audit Matter How the matter was addressed in the audit “Service Concession Arrangements” recognised within the scope of Turkish Financial Reporting Interpretations Committee (“TFRS Interpretations”) 12 and “Build Operate Transfer Investments” As explained in Note 2 in the accompanying consolidated financial statements as of December 31, 2019, the Group has “Service Concession Arrangements” and “Build Operate Transfer Investments” in the countries where its subsidiaries continue their operations. A service concession arrangement is an arrangement whereby a government or other public sector body contracts with a private operator to develop/upgrade, operate and maintain the grantor’s infrastructure. During the arrangement period, the operator receives income from the services provided. The party that recognizes the concession, controls the infrastructure investment and the contractor will eventually be transferred to the party that recognizes the operator’s infrastructure investment. The audit procedures applied including but not limited to the following are: Reviewing the terms of the contract, testing that the spending amounts are accounted for in a timely and appropriate manner in accordance with the cost value, reviewing useful life and residual value estimates and assumptions based on the calculation, Testing the calculated depreciation amounts, examining the renewal investment estimates that will occur in the forthcoming years estimated within the scope of the contract, evaluating the appropriateness of the discount rates applied within the scope of reducing the relevant amounts to today, The comparison of estimated and actual amounts includes procedures such as verifying the deposit amounts paid under the contract through the supporting documents.