CELEBI GROUND HANDLING 2025 AR

99 Çelebi Ground Handling 2025 Annual Report ÇELEBİ HAVA SERVİSİ ANONİM ŞİRKETİ AND ITS SUBSIDIARIES NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2025 (Amounts expressed in Turkish Lira (“TL”) unless otherwise indicated.) 2.8.5 Intangible Assets a) Goodwill Goodwill is reviewed annually for impairment and is carried in the balance sheet at its cost value less accumulated impairment losses. Any impairment losses recognized on goodwill cannot be reversed. The gain or loss from the sale of a business includes the carrying amount of the goodwill related to the sold entity. For impairment testing, goodwill is allocated to the cash-generating units. The allocation is made to the cash-generating units or groups of units expected to benefit from the business combination in which the goodwill arose. The future cash flow forecasts used in the impairment test do not include cash inflows and outflows related to future restructuring or performance improvements or enhancements that the Group has not yet committed to. b) Computer Software Computer software is recorded at the cost incurred to acquire the rights. Computer software is amortized over its estimated limited useful life using the straight-line method and is carried at the cost less accumulated amortization. The estimated useful life of computer software ranges from 3 to 15 years. Maintenance costs for computer software are expensed as incurred. Development costs initially recognized as expenses cannot be capitalized as assets at a later date. c) Concessions and Build-Operate-Transfer (BOT) Investments Concession agreements involve the construction/upgrade, operation, and maintenance of infrastructure used for providing public services over a pre-determined period by an operator. During the agreement period, the operator earns revenue for the services provided. The agreement defines performance standards, pricing mechanisms, and regulatory frameworks regarding potential disputes. The granting authority controls the infrastructure investment, and at the end of the contract, the operator transfers the infrastructure back to the granting authority.In relation to concession agreements, the Group applies the intangible asset model under IFRIC 12 “Service Concession Arrangements” for BOT investments. Intangible assets arising from concession agreements are tracked under the category of Build-Operate-Transfer investments, listed under intangible assets. Operational or service revenues are recognized by the Group in the period in which the service is provided. In the context of concession agreements, the liabilities related to maintenance or modernization are accounted for in accordance with TAS 37 (“Provisions, Contingent Liabilities, and Contingent Assets”). Depreciation on investment costs related to terminal construction is calculated using the normal depreciation method, based on the assumption that the terminal will be operated throughout its duration. Borrowing costs directly related to Build-Operate-Transfer (BOT) investments are capitalized as part of the cost of the related asset, provided that these costs are expected to generate future economic benefits for the asset and the costs can be measured reliably. Under concession agreements, the Group has capitalized the difference calculated by bringing the paid deposit amounts to their present value as a BOT investment, and it is amortized over the concession period of the terminals (Note 13). The security permits required for the Company to conduct ground handling and cargo warehouse operations through its subsidiaries in India were revoked by the Bureau of Civil Aviation Security (BCAS) on 15 May 2025. As a result, the operations of the relevant subsidiaries were terminated due to the unilateral termination of concession agreements by the respective airport authorities, which was directly linked to the cancellation of the security permits. Following this development, the Company’s management has initiated legal proceedings with the relevant authorities in India regarding the revocation of the security permits. These legal processes are currently ongoing. In connection with these legal developments, the carrying values related to Build-Operate-Transfer arrangements have been transferred to short-term and long-term other receivables, as per the contractual terms with airport operators and the detailed explanations provided in Note 13.