- Statutory record retention
- 5 yearsStatutory record retention
- e-Defter certification cycle
- Monthlye-Defter certification cycle
- Statutory and group, mapped
- 2 chartsStatutory and group, mapped
Challenge
A foreign-owned subsidiary loses its local accountant part-way through the year. The parent cannot reconcile the trial balance to its own chart of accounts, and nobody can explain how several material positions were arrived at.
Our approach
Opening balances are reconciled and evidenced before any new posting is made, filed returns are re-performed for the periods still open to correction, and the e-Defter and e-Fatura chain is checked for continuity.
Result
A trial balance that ties to filed returns, a documented position on every material judgement, and monthly reporting the parent can consolidate without a translation layer.
The risk sits behind you, not ahead of you
New bookkeeping is the easy part of a handover. The exposure is in what has already been filed: VAT positions taken on partially deductible input tax, expenses treated as deductible that are not, related-party charges with no transfer pricing support, and provisions that were never made. A new accountant who simply carries on from the closing balance inherits all of it silently.
What the opening review covers
Reconcile before posting. The opening trial balance is agreed to the last filed corporate tax return and to the certified e-Defter files, not just accepted from the previous ledger. Where the two disagree, the difference is identified line by line before any new entry is made.
Re-perform the open periods. Turkish tax returns can be corrected within the statutory correction window, and the penalty position is materially better when the company declares an error than when an inspection finds it. VAT and withholding returns for periods still open are re-performed against source documents.
Check the electronic chain. e-Fatura and e-Defter are not merely a filing format — they are the record. Ledgers are certified monthly and a break in the chain is visible to the administration. Missing certification, a lapsed financial seal, or invoices issued outside the e-Fatura system where the counterparty was registered are all common and all fixable, but only if found.
Document the judgements. Every material position gets a one-paragraph memo saying what was decided and on what basis. This is what makes the file defensible in an inspection two years later, when the person who made the call has left.
Reporting the parent can actually use
Most foreign subsidiaries in Türkiye keep one set of books, in Turkish, under the Tax Procedure Law, and then translate it for the parent once a year under pressure. We map the statutory chart of accounts to the group’s chart once, at handover, and keep both current — so month-end produces a statutory ledger and a group reporting pack from the same posting, rather than a reconciliation exercise every December.
Inflation accounting is part of the handover now
Türkiye applies inflation accounting for tax purposes, and the treatment materially changes both the balance sheet and the taxable base. A handover that ignores it produces a set of books that will not agree with the return. Whether the prior periods were restated correctly is one of the first things we check.