BIRLESIM_2022 ANNUAL REPORT

BİRLEŞİM MÜHENDİSLİK 2022 FAALİYET RAPORU 148 Birleşim Mühendislik Isıtma Soğutma Havalandırma Sanayi Ticaret Anonim Şirketi and Its Subsidiaries (Currency in Turkish Lira (“TL”) unless otherwise stated). Notes to the Consolidated Financial Statements for the Year Ended 31 December 2022 2. BASIS OF PRESENTATION OF FINANCIAL STATEMENTS (Continued) 2.8 Summary of Significant Accounting Policies (Continued) Foreign currency transactions Income and expenses arising from foreign currencies are translated at the exchange rates prevailing at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into Turkish lira at bid exchange rates of the Central Bank as at statement of financial position dates. Exchange gains or losses arising from settlement and translation of foreign currency items are included in the consolidated statement of income. Revenue recognition The Group transfers the revenue to a customer and records the revenue in its consolidated financial statements as it fulfills or fulfills the performance obligation. When an asset is checked (or passed) by the customer, the asset is transferred. The Group records the proceeds in its financial statements in accordance with the following basic principles: (a) Determination of contracts with customers (b) Determination of performance obligations in the contract (c) Determination of the transaction price in the contract (d) Dividing the transaction price into the contractual performance obligations. (e) Revenue recognition when each performance obligation is met. In the event that all of the following conditions are met, the Group recognizes a contract with its customer as revenue: (a) The parties to the Convention have ratified the contract (in accordance with written, oral or other commercial practices) and undertakes to carry out their own actions, (b) The group may define the rights related to the goods or services to be transferred by each party, (c) The Group may define payment conditions for goods or services to be transferred, (d) The contract is essentially commercial, (e) It is probable that the Group will be charged for the goods or services to be transferred to the customer. When evaluating whether the collectability of a price is probable, the entity shall consider only the customer’s ability to pay the price at the due date and its intent. Sales of goods and services Income includes invoiced values of goods and service sales. Revenue is recognized on an accrual basis at the fair value of the consideration received or receivable upon delivery of the product or service, transfer of risks and benefits relating to the product, reliable determination of the amount of revenue and the probable economic benefits associated with the transaction. In the event that there is an important financing cost within the sales, the fair value is determined by discounting the future collections with the hidden interest rate included in the financing cost. The difference between the fair value and the nominal value is considered as interest income on an accrual basis. Promotion income Excess goods received: Excess goods received on free basis from pharmaceutical companies (together with goods shipped against consideration) to be consequently distributed to pharmacies as promotion are recognized in inventories at zero value and the unit acquisition cost is determined as the total value of the goods received divided by the quantity of goods received on free basis and those received at consideration.