KAP

LOKMAN HEKİM ENGÜRÜSAĞ SAĞLIK TURİZM EĞİTİM HİZMETLERİ VE İNŞAAT TAAHHÜT A.Ş.

LKMNH

Publish Date

17.02.202221:56:58

Disclosure Type

Year

2021

Period

Annual

Notification Attachments (2)

Lokman Hekim 31.12.2021 BDR.pdf Lokman Hekim 31.12.2021 ENG.pdf

Financial Report

Independent Audit Firm	Audit Type	Opinion Type
VEZİN BAĞIMSIZ DENETİM A.Ş.	Audit	Unqualified Opinion

CONVENIENCE TRANSLATION INTO ENGLISH OF CONSOLIDATED FINANCIAL

STATEMENTS ORIGINALLY ISSUED IN TURKISH

INDEPENDENT AUDITOR'S REPORT ON THE CONSOLIDATED

FINANCIAL STATEMENTS OF LOKMAN HEKİM ENGÜRÜSAĞ SAĞLIK,

TURİZM, EĞİTİM HİZMETLERİ VE

İNŞAAT TAAHHÜT A.Ş. FOR 1 JANUARY ? 31 DECEMBER 2021

To The Board of Directors of

Lokman Hekim Engürüsağ Sağlık, Turizm, Eğitim Hizmetleri ve İnşaat Taahhüt A.Ş.

Opinion

We have audited the Consolidated Financial Statements of the Lokman Hekim Engürüsağ Sağlık, Turizm, Eğitim Hizmetleri ve İnşaat Taahhüt Anonim Şirketi (the "Company") and its subsidiaries (collectively referred as the "Group") which comprise the statement of financial position as at 31 December 2021, and the consolidated statement of profit or loss, statement of other comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at 31 December 2021, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards ("IFRS").

Basis for Opinion

We conducted our audit in accordance with Turkish Standards on Auditing issued by Public Oversight Accounting and Auditing Standards Authority of Turkey ("POA") and announcement of Capital Markets Board of Turkey ("CMB").

Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report.

We are independent of the Company in accordance with the International Ethics Standards Board for Professional Accountants' Code of Ethics for Professional Accountants ("IESBA Code") and have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Based on our professional judgments, The Key Audit Matters are most important issues on auditing period's consolidated financial statements.

These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon and we do not provide a separate opinion on these matters.

Key Audit Matters

How The Key Audit Matters Has Been Approached in the Audit Process

Reporting Revenue

When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction shall be recognized by reference to the stage of completion of the transaction at the end of the reporting period.

The amount of revenue arising from health services after taking into account the amount of any trade discounts and volume rebates, in exchange for health services, contains;

- For the billed health services, the amount billed

- For the ongoing patient cares, the cost based on the type of the services

In this context, determining the period and when to recognize revenue have importance from the point of our audit.

There are detailed explanations and the Company's accounting policies related to revenue in Note 2.2, Note 6 and Note 26.

After understanding the accounting policies and its codes of practice related to reporting revenue, the audit process we perform includes;
- Considering the revenue process, the period of sales and payments have been checked.
- The past operations related to Social Security Institution (SSI) and other insurance companies have been reviewed and the timing of recognizing the revenue into financial statements have been checked.

- Both from MEDULA (SSI Automation System) and from Hospital Information Management System, with using substantive tests, we have focused on the revenue associated with unbilled but recognized by reference to the stage of completion of the ongoing health care services.

- Income accruals from past periods and the bills belongs to current period are reviewed and have been tested whether the revenue is recognized correctly or not.

As a result of the audit we perform related the revenue, we had no material findings.

Key Audit Matters

How The Key Audit Matters Has Been Approached in the Audit Process

Recoverable of Trade Receivables

In accordance with the relevant provisions of TAS 16 "Tangible Assets" standard, the Company carries the lands, parcels and buildings at their fair values in its financial statements.

As of December 31, 2021, as a result of the valuation made by an independent professional valuation firm, the total pre-tax value increase of tangible assets has been TRY 29,976,332. The revaluation increases of tangible assets, which are under shareholders' equity in the statement of financial position, are accounted for by deducting the deferred tax effect. The total value increase of investment properties is TRY 1,410,000.

Applied valuation methods contain important estimations and assumptions. For these reasons, the subject of revaluation of the said land, parcels and buildings is an important issue for our independent audit.

Explanations on the accounting policies and amounts of the Group's land and parcel, buildings and investment properties are in Notes 2.3, 10 and 12.

During our independent audit, the following audit procedures have been applied regarding the revaluation and impairment of land, buildings and investment properties;

- Evaluation of the qualifications, competencies and impartiality of real estate appraisers appointed by the Group management,

- Testing the suitability of the methods used by the appraisers in the valuation reports,

- Checking the reconciliation of the values appraised by the valuation experts for the real estates in the valuation reports to the amounts explained in Notes 10 and 12,

- Controlling the valuation practices and tax effects in accordance with the Tax Procedure Law in accordance with the Law No. 7326 on the Restructuring of Certain Receivables and Amending Certain Laws,

As a result of these studies on revaluation of tangible assets and investment properties, we had no material findings.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with the Turkish Accounting Standards issued by the Public Oversight Accounting and Auditing Standards Authority ("POA"). This responsibility includes designing, implementing and maintaining the necessary internal control system in order to ensure that the financial statements are free from material misstatement resulting from errors and / or fraud and irregularities, making accounting estimates required by the circumstances and selecting appropriate accounting policies in order to ensure that they reflect the truth in an honest way.

In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standards on Auditing ("ISA") will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also;

- Identify and assess the risks of material misstatements of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collision, forgery, intentional omissions, misrepresentations, override of internal control.

- Obtain and understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

- Conclude on the appropriateness of management's use of the going concern basis of accounting and based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events may cause the Company to cease to continue as a going concern.

- Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures and the whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

- Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible of the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Liabilities Arising from the Legislation

1) In accordance with the fourth paragraph of Article 402 of the Turkish Commercial Code ("TCC"), no material issue has been found regarding the bookkeeping schedule of the Company for the period of 1 January - 31 December 2021 as to whether the financial statements do not conform to the provisions of the law and the Company's articles of incorporation for financial reporting.

2) In accordance with the fourth paragraph of Article 402 of the Turkish Commercial Code, the Board of Directors has made the required explanations within the scope of the audit and issued the requested documents.

3) The Auditor's Report on the Early Detection System of Risk and Committee organized in accordance with the fourth paragraph of Article 398 of the Turkish Commercial Code was presented to the Company's Board of Directors on February 17, 2022.

17 February 2022, Ankara

Vezin Bağımsız Denetim A.Ş.

Member Firm of HLB International

Fatma Zehra KOŞ

Auditor in Charge

Notification Attachments (2)

Lokman Hekim 31.12.2021 BDR.pdf Lokman Hekim 31.12.2021 ENG.pdf

Notifications Financial Statements Corporate Actions

PDF

WORD

EXCEl

Presentation Currency	TL
Nature of Financial Statements	Consolidated