KAP

HİTİT BİLGİSAYAR HİZMETLERİ A.Ş.

HTTBT

Publish Date

04.03.202421:18:40

Disclosure Type

Year

2023

Period

Annual

Notification Attachments (2)

Hitit 31.12.2023 TR.pdf Hitit 31.12.2023 ENG.pdf

Financial Report

Independent Audit Firm	Audit Type	Opinion Type
PwC BAĞIMSIZ DENETİM VE SERBEST MUHASEBECİ MALİ MÜŞAVİRLİK A.Ş	Audit	Unqualified Opinion

CONVENIENCE TRANSLATION INTO ENGLISH OF

INDEPENDENT AUDITOR'S REPORT

ORIGINALLY ISSUED IN TURKISH

INDEPENDENT AUDITOR'S REPORT

To the General Assembly of Hitit Bilgisayar Hizmetleri A.Ş.

A. Audit of the consolidated financial statements

1. Our opinion

We have audited the accompanying consolidated financial statements of Hitit Bilgisayar Hizmetleri A.Ş. (the "Company") and its subsidiaries (collectively referred to as the "Group") which comprise the consolidated statement of financial position as at 31 December 2023, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended and notes to the consolidated financial statements comprising a summary of significant accounting policies.

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group as at 31 December 2023, and its financial performance and its cash flows for the year then ended in accordance with Turkish Financial Reporting Standards ("TFRS").

2. Basis for opinion

Our audit was conducted in accordance with the Standards on Independent Auditing (the "SIA") that are part of Turkish Standards on Auditing issued by the Public Oversight Accounting and Auditing Standards Authority (the "POA"). Our responsibilities under these standards are further described in the "Auditor's Responsibilities for the Audit of the Consolidated Financial Statements" section of our report. We hereby declare that we are independent of the Group in accordance with the Ethical Rules for Independent Auditors (including Independence Standards) (the "Ethical Rules") and the ethical requirements regarding independent audit in regulations issued by POA that are relevant to our audit of the financial statements. We have also fulfilled our other ethical responsibilities in accordance with the Ethical Rules and regulations. We believe that the audit evidence we have obtained during the independent audit provides a sufficient and appropriate basis for our opinion.

3. Key audit matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. Key audit matters were addressed in the context of our independent 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 matter was addressed in the audit

Recognition of Revenue

609.051.324 TL of revenue has been recognized for the year ended 31 December 2023, which is an important performance indicator to assess the result of the strategies performed during the year.

The Group's main revenue streams are software sales and maintance services.

Wtihin these revenue streams, there is a risk of material misstatement due to complexity associated with the Group offering software and maintanace services under different contractual terms. This introduces risks related to the timing of revenue recognition, the accuracy completeness of records.

Due to materiality of revenue within the comprehensive income statement, it has ben identified as a key audit matter.

Group's accounting policies and estimates regarding revenue is disclosed in Note 2.5 and 15.

The procedures we have performed regarding revenue included gaining an understanding of the process, assessment of internal control enviorement and a combination of substantive analytical procedures and detailed testing.

Regarding revenue recognition; we have assessed the appropriateness of the following:

The Group's accounting policies

Identification of the Group's revenue contracts

Identification of performance obligations

Determination of transaction prices

Allocation of transaction prices to performance obligations in accordance with TFRS 15. We have reviewed a sample of revenue contacts with significant customers, considered the apporpirateness of the timing of recognition and tested substantively delivery acceptance on a sample basis.

We have tested product and software revenue by inspecting supporting documentation and tested for accuracy and completeness on a sample basis.

Maintanance revenue is recognised on a monthly basis. We have performed substantive test of details on a sample of customer invoices and related accouting records.

We have also reviewed the disclosures regarding revenue in accordance with TFRS requirements.

Key Audit Matters

How the key audit matter was addressed in the audit

Capitalisation of development costs

The Group has 202.053.272 TL of capitalised development costs in the accopanying consolidated financial statements as at 31 December 2023.

The Group applies the requirements of TMS 38 Intagible Assets standard and its accounting policy is disclosed in Note 2.5 and Note 9.

The Group capitalised payroll and directly related costs in projects where the project is in development stage and the Group expects future positive cash flows.

During the capitalisation process only the time directly spent on the project is taken into account and all remaining time is expensed as incurred.

Since the total capitalised development cost is material to the consolidated financial statements and the process involves management estimates we have included the matter as a key audit matter.

The procedures we have performed in testing the capitalisation of development costs include; a comprehensive understanding of the process, assessment of internal control enviorement and a combination of substantive analytical procedures and detailed tests.

We have assessed the details of software development projects and the criteria for capitalisation. During this assessment we have compared the future cash flow estimates with prior performance and the recovarability of these capitalised development costs in line with the requirement of TMS 38 Intagible Assets standard.

We have received a breakdown of all costs that are determined to be capitalised by project, employee and nature of cost. We have performed substantive testing procedures based on this breakdown.

Managent estimates regarding the useful life of these capitalised development costs are compared with the estimates of peer competitors and the life cycle of the customer contracts.

We have also assessed the apporpriateness of the disclosures stated in Note 2.5 and Note 9.

4. Responsibilities of management and those charged with governance for the consolidated financial statements

The Group management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with TFRS, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Group'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 Group or to cease operations, or has no realistic alternative but to do so.

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

5. Auditor's responsibilities for the audit of the consolidated financial statements

Responsibilities of independent auditors in an independent audit are as follows:

Our aim is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an independent auditor's report that includes our opinion. Reasonable assurance expressed as a result of an independent audit conducted in accordance with SIA is a high level of assurance but does not guarantee that a material misstatement will always be detected. Misstatements can arise from fraud or error. Misstatements 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 consolidated financial statements.

As part of an independent audit conducted in accordance with SIA, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement in 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 collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Assess the 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 Group'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 independent auditor's report. However, future events or conditions may cause the Group to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and 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 for 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 provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence. We also communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards actions taken to eliminate threats or safeguards applied.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated 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.

B. Other responsibilities arising from regulatory requirements

1. No matter has come to our attention that is significant according to subparagraph 4 of Article 402 of Turkish Commercial Code ("TCC") No. 6102 and that causes us to believe that the Company's bookkeeping activities concerning the period from 1 January to 31 December 2023 period are not in compliance with the TCC and provisions of the Company's articles of association related to financial reporting.

2. In accordance with subparagraph 4 of Article 402 of the TCC, the Board of Directors submitted the necessary explanations to us and provided the documents required within the context of our audit.

3. In accordance with subparagraph 4 of Article 398 of the TCC, the auditor's report on the early risk identification system and committee was submitted to the Company's Board of Directors on
4 March 2024.

PwC Bağımsız Denetim ve

Serbest Muhasebeci Mali Müşavirlik A.Ş.

Orhan Öztürk, SMMM

Independent Auditor

Istanbul, 4 March 2024

Notification Attachments (2)

Hitit 31.12.2023 TR.pdf Hitit 31.12.2023 ENG.pdf

Notifications Financial Statements Corporate Actions

PDF

WORD

EXCEl

Presentation Currency	TL
Nature of Financial Statements	Consolidated