2002 Annual Report - Turkish Airlines

84 • 2002 TURKISH AIRLINES annual reportTURKISH AIRLINES INC.NOTES TO THE FINANCIAL STATEMENTS / continued(all figures are restated to TL money values at December 31, 2002 pursuant to IAS 29)The reconciliation from the expected to the disclosed tax benefit is as follows:December 31, 2002 December 31, 2001TL 000,000 TL 000,000Profit / (Loss) Before Taxation 282,200,524 (46,663,322)Expected Tax at 33% for 2002 and 19.8% for 2001 93,126,172 (9,239,338)Reconciling Items:Non Deductible Expenses - 13,852,910Accumulated Losses (1,537,876) (19,023,077)Monetary Gains/Losses not (taxable) / Deductible (13,625,575) 22,246,231Deferred Tax Expense Resulting from Increase in Effective Tax Rate 3,993,035 -Actual Tax Expense 81,955,756 7,836,72623- MANUFACTURERS’ CREDIT (NET)Unearned income from manufacturer’s credits consists of the following:December 31, 2002 December 31, 2001TL 000,000 TL 000,000Gross Manufacturers’ Credit 20,650,286 23,796,496Accumulated Depreciation (-) (13,608,039) (13,301,666)7,042,247 10,494,83024- RETIREMENT PAY PROVISIONUnder Turkish Labor Law, employees are entitled to receive a lump sum payment when their employment is terminated without due cause or when theyretire, complete 25 years of service (20 years for women), are called up for military service or die. The amount payable consists of one month's gross salaryper year of service. The gross salary is the salary at the date of termination, but subject to a limit of TL 1,260,150,000 as at December 31, 2002 (TL 978,020,000as at December 31, 2001 at historic money values). The number of years’ service required before retirement is rising according to a sliding scale based on newlegislation enacted in 1999. The system described above can be classified as an unfunded defined benefit system. The total provision provided in the financialstatements represents the estimated present value of the vested benefit obligation.Amounts recognized in the income statement as provision for termination benefit are as follows:December 31, 2002 December 31, 2001TL 000,000 TL 000,000Current Service Cost 8,590,606 6,145,958Interest Cost 4,004,117 4,874,74812,594,723 11,020,706