ERDEMIR2014 ENG

177

ERDEMİR GRUBU

2014 ANNUAL REPORT

EREĞLİ DEMİR VE ÇELİK FABRİKALARI T.A.Ş AND ITS SUBSIDIARIES

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 DECEMBER 2014

(Amounts are expressed as Turkish Lira (“TRY Thousand”) unless otherwise indicated.)

(Convenience Translation into English of Consolidated Financial Statements Originally Issued in Turkish - See Note 34)

NOTE 31 - FINANCIAL INSTRUMENTS (FAIR VALUE AND FINANCIAL RISK MANAGEMENT DISCLOSURES) (cont’d)

Additional information about financial instruments

Categories of the financial instruments and their fair values (cont’d)

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market

participants at the measurement date.

Estimated fair values of financial instruments have been determined by the Group by using available market information and appropriate

valuation methodologies. However, judgement is necessarily required to interpret market data. Accordingly, estimates presented herein

are not necessarily indicative of the amounts the Group could realise in a current market exchange.

The following methods and assumptions are used to estimate the fair values of financial instruments:

Financial assets

Financial assets that are carried at cost value including cash and cash equivalents are assumed to reflect their fair values due to their

short term nature.

The carrying values of receivables, with related impairments are assumed to reflect their fair values.

Financial liabilities

Fair values of short term borrowings and trade payables are assumed to approximate their carrying values due to their short term nature.

Fair values of long term financial liabilities are assumed to approximate their carrying values due to mostly they have floating interest

rates and repricing at short term.

Financial asset and liabilities at fair value

Fair value level as of reporting date

31 December 2014

Level 1

Level 2

Level 3

Financial assets and liabilities at fair

value through profit/loss

Derivative financial assets

70.572

Derivative financial liabilities

(16.995)

Financial assets and liabilities at fair

value through other comprehensive

income/expense

Derivative financial assets

21.740

Derivative financial liabilities

(12.940)

Total

62.377