BIRLESIM_2021_ANNUAL REPORT

BİRLEŞİM MÜHENDİSLİK 2021 ANNUAL REPORT 149 Birleşim Mühendislik Isıtma Soğutma Havalandırma Sanayi Ticaret A.Ş. and Its Subsidiary (All amounts expressed in Turkish Lira (“TL”)) Notes to the Consolidated Financial Statements For the Year Ended 31 December 2021 2. BASIS OF PRESENTATION OF THE CONSOLIDATED FINANCIAL STATEMENTS (Continued) (h) Basis of Consolidation (continued) If the parent loses control of a subsidiary, the post-sale profit/loss is the difference between i) the sum of the sales price received and the fair value of the remaining interest and ii) the previous carrying amount of the subsidiary’s assets (including goodwill) and liabilities and non-controlling interests. is calculated. In other comprehensive income, the amounts previously accounted for and collected in equity regarding the subsidiary are recorded according to the accounting method to be used on the assumption that the Parent has sold the relevant assets (for example, transfer to profit/loss or transfer directly to retained earnings in accordance with the relevant TAS standards). The fair value at the date of loss of control of the investment remaining after the sale of the subsidiary is recognized as fair value on initial recognition or, where applicable, as cost on initial recognition of an investment in an associate or jointly controlled entity. Business Combinations and Goodwill A business combination is an event or transaction in which the acquirer gains control of one or more businesses. In the business combinations of the Group in 2017 and 2018, the purchase method was applied within the scope of the revised TFRS 3 “Business Combinations” standard effective from 1 January 2010. In this method, the acquisition cost includes the fair value of the assets given at the acquisition date, the equity instruments issued, the liabilities assumed or incurred at the date of the exchange and the additional costs attributable to the acquisition. If the business combination agreement contains provisions that the cost can be adjusted depending on future events; If the adjustment is probable and its value can be determined, it is included in the merger cost at the acquisition date. The difference between the acquisition cost of a business and the fair value of the identifiable assets, liabilities and contingent liabilities of the acquired business is accounted for as goodwill in the consolidated financial statements. Goodwill arising in a business combination is not amortized, but is instead tested for impairment annually (as at 31 December) or more frequently when circumstances indicate that it is impaired. Impairment losses calculated on goodwill are not associated with the profit or loss statement in the following periods if the said impairment disappears. Goodwill is associated with cash-generating units during impairment testing. If the acquirer’s share in the fair value of the acquired identifiable assets, liabilities and contingent liabilities exceeds the business combination cost, the difference is associated with the consolidated profit or loss statement. Acquisitions of Business Shares under Joint Control Business combinations resulting from the transfer of shares of companies controlled by the main shareholder controlling the Group are accounted for at the date of joint control. Assets and liabilities acquired are recorded at their book value. Equity items of the acquired companies are added to the same items in the Group’s equity, except for the capital, and the resulting profit or loss is recognized in the equity. Erde Mühendislik A.Ş.; the shareholders transferred 100% of their shares to the Parent Company in exchange for TL 10.463.383 in accordance with the Board of Directors decision taken on 10 December 2013. The transfer transaction has been made on the basis of the financial statements dated 31 December 2013. The assets and liabilities acquired from the business combinations realized through the share transfer of Erde Mühendislik Sanayi ve Ticaret A.Ş, which is under the joint control of the shareholders controlling the Parent Company, are accounted for with their book values.