BASIS OF PRESENTATION OF THE FINANCIAL STATEMENTS Cash and Cash Equivalents

Cash and cash equivalents are carried in the balance sheet at cost. Cash and cash equivalents include all short-term, highly liquid investments that are readily convertible to known amounts of cash and near to maturity that they present an insignificant risk of changes in value because of changes in interest rates.

Marketable Securities

Marketable securities for purpose of Buying-Selling

Marketable securities for purpose of buying-selling are purchased to have a rake off on short term price movements. Marketable securities for purpose of buying-selling are carried at cost in purchase date, and then at the period end these securities are valued by market price. All the realized and unrealized gains and losses are reflected in the income statement of the related period.

Witholding financial instruments till maturity

Witholding financial instruments are securities which have a specific maturity structure and these securities include specific payments. These securities are valued by internal rate of return. All the realized and unrealized gains and losses are reflected in the income statement of the related period.

Reverse Repurchase Agreements

The Company enters into short-term purchase of securities (consisted of public bonds and treasure bills) under agreements to resell such securities. Securities purchased under agreements to resell are stated at cost plus accrued interest for the period from the acquisition date to the balance sheet date. The difference between purchase and resale price is treated as interest income, accrued over the life of the reverse repurchase agreement and classified under “Other Income from Operations”.

Years

Machinery and Equipment 3-5

Motor Vehicles 5

Furniture and Fittings 4-5

Intangible Assets

Intangible assets are carried at cost. Amortization is provided on the restated amounts of assets on a straight-line method with pro-rate basis for three to five years.

2007

Impairment of Assets

Property, plant and equipment and intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Whenever the carrying amount of an asset exceeds its recoverable amount, an impairment loss is recognized in income for items of property, plant and equipment and intangibles carried at cost.

Related Parties

For the purpose of the accompanying financial statements, shareholders of the Company and related companies, group companies and the companies related to those companies, their directors and key management personnel and groups to which they are known to be related, are considered and referred to as related companies.

Other Balance Sheet Items

Other balance sheet items are stated at their nominal values.

Taxation

Tax expense / (income) is the aggregate amount included in the determination of net profit or loss for the period in respect of current and deferred tax. The charge for current tax is based on the results for the year as adjusted for items which are non-assessable or disallowed.

It is calculated using tax rates that have been enacted or subsequently enacted by the balance sheet date. Deferred tax is accounted for using the liability method in respect of temporary differences arising from differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax basis used in the computation of taxable (statutory) profit. Deferred tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are recognized to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilized.

Employee Termination Benefits/Severance Pay

• Severance Pay

Under Turkish Labor Law, the Company is required to pay termination benefits to each employee who has completed one year of service and whose employment is terminated without due cause, or who retires in accordance with social insurance regulations or is called up for military service or dies. Such payments are calculated on the basis of 30 days pay limited to a maximum of TRY 2,030 (31.12.2006: TRY 1,857) as of 31 December 2007 per year of employment at the rate of pay applicable at the date of retirement.

Company used “Projection Method” to calculate the termination benefits and the duration to be completed based on the past experience and discounted with rate of treasury bond at balance sheet date. The calculated profits and losses are reflected in income statements.

The rates of basic assumptions used at balance sheet date are as follows:

31.12.2007 31.12.2006

Rediscount Rate 11% 11%

Inflation Rate 5% 5%

• Social Insurance Contributions

Company compulsorily pays social insurance contributions to Social Security Instutition.

Company does not have any other liabilities as long as it pays these contributions. These contributions are reflected as personnel expenses in the period they are paid.

Foreign Currency Transaction

Transactions in foreign currencies during the periods have been converted at the exchange rates prevailing at the dates of these transactions. Balance sheet items denominated in

2007

foreign currencies have been converted at the exchange rates prevailing at the balance sheet dates. Foreign exchange gains and losses occurred from foreign currency transactions are reflected in the income statements.

The period end rates used for US $ and EURO are shown below:

31.12.2007 31.12.2006

US $ 1.1647 1.4056

EURO 1.7102 1.8515

Investment Fund Management Fees and Performance Premiums

At the end of each month, the Company computes investment fund management fees over each client's investment portfolio taking into account the total management periods and the rates specified by mutual agreements. Furthermore, should the actual yield exceed the client's expected yield specified in the agreement, once in every three months since the commencement of the agreement, a performance premium is to be computed over the difference between the actual yield and expected yield.

Performance premiums are recorded to income in the periods they are computed. The collection of performance premiums from clients are realized after the completion of the three month periods.

Financial Instruments

• Credit Risk

The Company doesn't have extended credit so the Company doesn't have any credit risk related with adverse parties.

• Interest Rates Risk

The oscillation in price of financial instruments due to changes in the interest rate of the market generates necessaty to deal with interest rate risk. This changing interest rate risk is managed mostly by holding short term assets.

• Liquidity Risk

Fair liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions. Due to the dynamic nature of the underlying business Company aims at maintaining flexibility in funding by keeping committed credit lines.

• Foreign Currency Risk

The Company takes on exposure to effects of fluctuations in the prevailing exchange rates on its financial position and cash flows. The level of exposure is monitored by currency on a periodic basis. The Company also has transactional currency exposures. Such exposures arise from sales or purchases or borrowings by the Company in currencies other than the Company's measurement currency and they are converted with the foreign exchange rate of the transaction date. The gains and losses from the conversion of assets and liabilities in foreign cureencies are recorded in the income statement.

• Fair Value of Financial Instruments

Fair value is the amount at which a financial instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation, and is best evidenced by a quoted market price, if one exists to the extent relevant and reliable information is available from the financial markets in Turkey, the fair value of the financial instruments of the Company is based on such market data. The fair values of the remaining

2007

financial instruments of the Company can only be estimated. The estimates presented herein are not necessarily indicative of the amounts the Company could realize in a current market exchange. The following methods and assumptions were used to estimate the fair value of the Company's financial instruments:

Financial Assets

Monetary assets for which fair value approximates carrying value:

- Balances denominated in foreign currencies are converted at period/year-end exchange rates.

- The fair value of certain financial assets carried at cost, including cash and cash equivalents are considered to approximate their respective carrying amounts in the financial statements.

- The carrying value of trade receivables, net of allowances for possible non-recovery of uncollectibles are considered to approximate their fair values.

Financial Liabilities

Monetary liabilities for which fair value approximates carrying value:

- The fair value of short-term bank loans and other monetary liabilities are considered to approximate their respective carrying values due to their short-term nature.

- The fair values of long-term bank borrowings and lease payables, which are denominated in foreign currencies and translated at period/year-end exchange rates, are considered to approximate their carrying values.

- The carrying amount of accounts payable and accrued expenses reported in the financial statements for estimated third party payer settlements approximates its fair values.

Subsequent Events:

In the case of the occurrence of subsequent events after the date of the balance sheet which require the balance sheet to be adjusted, the Company corrects its financial statements in consideration of the new events. Events which do not require adjustments are explained in the notes of the report if they are material as they could affect investors' decisions.

Provisions, Commitments and Contingencies Provisions

A provision is recognized when, and only when an enterprise has a present obligation (legal or constructive) as a result of a past event and it is probable (i.e. more likely than not) that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate.

Commitments and Contingencies

Transactions that may give rise to contingencies and commitments are those where the outcome and the performance of which will be ultimately confirmed only on the occurrence or non occurrence of certain future events, unless the expected performance is not very likely. Accordingly, contingent losses are recognized in the financial statements if a reasonable estimate of the amount of the resulting loss can be made. Contingent gains are reflected only if it is probable that the gain will be realized.

Accounting Policies and Use of Estimates

The preparation of financial statements in conformity with Communiqué XI No: 25 standards, requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of current event and actions, actual results ultimately may differ from those estimates. The estimates are evaluated periodically, if necessary revised and reflected in the related period's income statement.

2007

Cash Flow Statement

The Company prepared cash flow statement according to the related commniqués of CMB.