Companies Subject to Independent Audit under the Turkish Commercial Code

Under the Turkish Commercial Code, companies subject to independent audit must meet the following conditions:

1. Companies within the scope of the annexed List (I)

2. Other companies that exceed the thresholds for at least two of the following three criteria in two consecutive financial periods.

a) Thresholds for companies whose capital market instruments are not traded on an exchange or other organised market but which are deemed publicly held under the Capital Markets Law:

• Total assets of TRY 30 million.

• Annual net sales of TRY 40 million.

• 50 employees.

b) Thresholds for companies in List (II):

• Total assets of TRY 60 million.

• Annual net sales of TRY 80 million.

• 100 employees.

c) Thresholds for companies other than those in sub-paragraphs (a) and (b):

• Total assets of TRY 75 million.

• Annual net sales of TRY 150 million.

• 150 employees.

3. Companies within the scope of the annexed List (II) are subject to independent audit, alone or together with their subsidiaries and associates, within the limits specified in the list.

LIST (I)

1. Of the companies subject to the regulation and supervision of the Capital Markets Board under the Capital Markets Law:

a) Investment firms,

b) Collective investment undertakings,

c) Portfolio management companies,

d) Mortgage finance institutions,

e) Asset leasing companies,

f) Central clearing institutions,

g) Central securities depositories,

h) Trade repositories,

i) Credit rating agencies

j) Valuation firms,

k) Joint stock companies whose capital market instruments are traded on an exchange or other organised market and which have a valid prospectus or issue document approved by the CMB for that purpose.

l) Joint stock companies that, although not traded on an exchange or other organised market, issue capital market instruments other than shares without a public offering, or that have a valid issue document approved by the CMB for that purpose.

2. Companies subject to the regulation and supervision of the Banking Regulation and Supervision Agency

a) Banks

b) Credit rating agencies

c) Financial holding companies

d) Financial leasing companies

e) Factoring companies

f) Financing companies

g) Asset management companies

h) Companies that are qualifying shareholders, as defined in Law No. 5411, in financial holding companies

i) Savings finance companies

3. Insurance, reinsurance and pension companies operating under the Insurance Law and the Private Pension Savings and Investment System Law

4. Authorised institutions, precious metals intermediaries and companies engaged in the production or trade of precious metals that are permitted to operate in Borsa İstanbul markets.

5. Licensed warehouse operators established under the Agricultural Products Licensed Warehousing Law and general warehouses established under the General Warehouses Law.

6. Media service providers holding at least one of the following rights or licences:

• The right to broadcast national television terrestrially
• A satellite television broadcasting licence
• A cable television broadcasting licence covering more than one province

LIST (II)

1. Companies at least 25% of whose capital belongs directly or indirectly to professional organisations with public institution status, trade unions, associations, foundations, cooperatives and their umbrella organisations.

2. Companies publishing daily newspapers nationwide.

3. Companies, other than call centre companies, subject to the regulation and supervision of the Information and Communication Technologies Authority under the Electronic Signature Law, the Electronic Communications Law, the Postal Services Law and Article 1525 of the Turkish Commercial Code.

4. Companies operating under a licence, certificate or authorisation from the Energy Market Regulatory Authority and subject to its regulations.

5. Excluding those within the scope of List (I): affiliates of the Savings Deposit Insurance Fund and companies whose supervision and management have been taken over by the Fund under the repealed Banks Law No. 4389 and Banking Law No. 5411, excluding affiliates and companies that are inactive or whose activities have been temporarily suspended or cancelled (including those for which the necessary amendments to the articles of association and similar procedures have not yet been completed).

6. Excluding those within the scope of List (I): state economic enterprises and their subsidiaries operating under Decree-Law No. 233 on State Economic Enterprises, and companies at least 50% of whose capital belongs to municipalities.

Note: Effective from 01.01.2023 under Presidential Decree No. 6434, published in Official Gazette No. 32029 of 30/11/2022.