Turkish Company Accounting Records Are Destroyed or Missing: Rights of Foreign Shareholders 2026 Updated Guide

What can a foreign shareholder do when a Turkish company’s accounting books, invoices or financial records are missing or destroyed? Learn about inspection rights, evidence preservation, director liability, special audit, litigation and emergency measures in Turkey.

A foreign shareholder investing in a Turkish company may face a serious corporate dispute when accounting books, invoices, bank records, contracts or other financial documents suddenly become unavailable. Management may claim that records were lost, accidentally destroyed, corrupted electronically, taken by a former accountant or simply cannot be located. In more serious disputes, missing records may create suspicions concerning hidden payments, unauthorized withdrawals, related-party transactions, fictitious expenses, concealed company assets or manipulation of financial statements.

The disappearance of accounting records does not automatically prove fraud or director misconduct. However, foreign shareholders should react quickly because the missing documents may affect their ability to monitor management, determine the real financial condition of the company and protect potential corporate claims.

Why Are Company Accounting Records So Important?

Accounting books and supporting records provide evidence concerning the company’s assets, liabilities, income, expenses, receivables and commercial transactions. They may also reveal payments to shareholders, directors, affiliated companies, employees and third parties.

When these records disappear, the shareholder may lose visibility over the company’s financial position.

Which Records May Be Relevant?

The investigation should not focus exclusively on statutory accounting books. Relevant evidence may include general ledgers, journals, inventory records, invoices, electronic invoices, bank statements, payment instructions, contracts, payroll records, tax filings, corporate resolutions, expense documents, credit-card records, loan agreements, shareholder-current-account records and electronic accounting databases.

Missing Records Do Not Automatically Prove Misconduct

Records can genuinely disappear because of fire, flooding, computer failure, relocation, theft or problems involving an external accountant.

The first legal question is therefore what happened to the records and whether management took appropriate steps to preserve and reconstruct them.

Foreign Shareholders Have Corporate Information Rights

A foreign shareholder generally does not lose shareholder rights merely because they live outside Turkey. The precise information and inspection mechanisms depend particularly on the company’s legal form and the circumstances of the dispute.

The shareholder should determine which statutory and contractual rights are available rather than relying solely on informal requests to management.

Send a Formal Request for Information

Where serious financial records are missing, an informal email may be insufficient. A structured request can identify the documents sought, relevant accounting periods and transactions requiring explanation.

This also creates evidence showing when management was asked to provide information.

Ask What Happened to the Original Records

Management should be asked to explain when the documents disappeared, where they were stored, who had access, when the loss was discovered and what recovery measures were taken.

A vague statement that “the accountant lost everything” should not automatically end the inquiry.

Determine Whether Only Certain Periods Are Missing

Selective disappearance can be particularly important. For example, records may exist for every financial year except the period in which a disputed property sale, related-party payment or large bank withdrawal occurred.

Create a timeline showing exactly which records remain available.

Bank Records May Reconstruct Missing Accounts

Even when internal accounting records disappear, bank transaction histories may provide substantial evidence.

Payments can be matched against invoices, contracts, tax records and counterparty information to reconstruct important transactions.

Electronic Records Should Be Preserved Immediately

Modern corporate accounting leaves multiple digital traces. Accounting software, email servers, cloud storage, electronic invoices, banking platforms and backup systems may contain recoverable information.

Companies should avoid overwriting or deleting relevant digital data once a dispute has arisen.

Examine Backup Systems

Determine whether the company maintained server backups, cloud backups or copies with its accountant or financial adviser.

Claims that all records disappeared should be tested against the company’s actual information technology infrastructure.

Contact the Independent Accountant or Financial Adviser

External accountants may hold copies of accounting entries, tax submissions, invoices and supporting records.

The shareholder’s ability to obtain information directly will depend on legal authority and confidentiality obligations, but the existence of external copies should be investigated.

Tax Records Can Provide Another Evidence Source

Tax declarations and related filings may assist in reconstructing the company’s historical financial position.

Differences between reconstructed accounting information and previously filed declarations may require further investigation.

Electronic Invoices Can Be Important

Where transactions were conducted through electronic invoicing systems, copies or electronic records may remain available even if the company’s local accounting database has disappeared.

The investigation should therefore distinguish between loss of the company’s internal copy and actual disappearance of the underlying transaction evidence.

Review Company Bank Accounts

Bank statements can reveal transfers to directors, shareholders, affiliated companies and unidentified third parties.

Particular attention may be given to unusually large withdrawals, repeated round-number transfers and payments without an obvious commercial explanation.

Related-Party Transactions Should Be Examined

Missing accounting records may conceal transactions between the company and entities controlled by directors or majority shareholders.

Request supporting agreements, invoices, board decisions and evidence demonstrating the commercial purpose of those transactions.

Look for Unexplained Cash Withdrawals

Significant cash withdrawals require careful examination, particularly where supporting receipts or expense documentation is unavailable.

The person responsible should be asked to explain the commercial purpose and ultimate use of the funds.

Company Credit Cards Can Reveal Personal Expenditure

Credit-card statements may identify travel, accommodation, luxury purchases or other expenses requiring explanation.

The legal characterization depends on the circumstances; the existence of personal-looking expenditure alone should not be treated as conclusive without examining its business purpose.

Fixed Assets Should Be Physically Verified

If accounting records are unreliable, compare the company’s known assets with what physically exists.

Machinery, vehicles, inventory, equipment and other valuable property should be identified and documented.

Check Title and Vehicle Records Where Appropriate

Where company-owned real estate or vehicles are suspected of having been transferred, relevant official records may provide evidence independent of internal accounting books.

The timing, purchaser and consideration should then be investigated.

Review Shareholder Current Accounts

Transactions recorded as shareholder or director receivables and payables can conceal significant movements of corporate money.

Reconstruct these accounts carefully using banking and accounting evidence.

Examine Dividend Payments

Determine whether distributions were properly authorized and supported by the company’s financial position and corporate resolutions.

Payments described as dividends should be compared with general assembly decisions and financial statements.

Review Management Fees and Bonuses

Large management fees, bonuses or consulting payments to directors and related parties should be supported by the applicable corporate and contractual framework.

Missing documentation can make these transactions a significant focus of shareholder disputes.

Majority Shareholders Cannot Treat Company Assets as Personal Property

A company has a legal identity distinct from its shareholders. Control of the majority of shares does not automatically authorize personal use of company money or assets.

Foreign minority shareholders should distinguish company losses from direct personal losses when developing claims.

Director Liability May Arise

Depending on the company’s legal form and facts, directors or managers may face civil liability where they breach duties concerning company administration, accounting, record preservation or protection of corporate assets.

Liability requires analysis of the particular conduct, damage, causation and applicable statutory duties.

Missing Records Can Affect Director Accountability

Where management cannot explain substantial transactions because required records are unavailable, the evidentiary consequences can become important in later litigation.

However, the legal strategy should be based on concrete transactions rather than simply alleging misconduct because documents are missing.

Request General Assembly Action Where Appropriate

Depending on the company structure and shareholder rights, corporate mechanisms may be available to place accounting concerns before the general assembly.

Questions concerning financial statements, management discharge and investigation of specific transactions can become important.

Be Careful With Management Discharge

If shareholders are being asked to approve or discharge management while major accounting records remain unavailable, the implications should be reviewed carefully before voting.

Foreign shareholders should not sign corporate resolutions they do not fully understand.

Special Audit Mechanisms May Be Relevant

Under appropriate circumstances, Turkish company law provides mechanisms through which shareholders may seek closer examination of specific corporate matters.

Whether the requirements for a special audit are satisfied depends on the company type, information previously requested and facts requiring investigation.

A Special Audit Should Be Targeted

A request framed as “investigate everything that happened in the company” may be less effective than identifying specific transactions.

For example, the investigation may focus on a property transfer, payments to an affiliated company or unexplained withdrawals during a defined period.

Evidence Preservation Can Become Urgent

If there is a real risk that remaining documents or digital records will disappear, legal measures aimed at preserving evidence should be considered promptly.

Waiting until ordinary litigation begins may result in further evidence loss.

Court-Based Evidence Determination May Be Considered

Where legally available and necessary, procedural mechanisms for preserving or determining evidence before or during litigation can become important.

The objective is to document relevant facts before records, assets or electronic information change.

Interim Measures May Be Necessary

If missing accounting records are accompanied by evidence suggesting that company assets are being transferred or dissipated, interim judicial measures may need to be evaluated.

Such measures require an appropriate legal basis and supporting evidence; they are not granted merely because shareholders distrust management.

Bank Account Measures Require Strong Grounds

A shareholder generally cannot obtain a freeze of all corporate bank accounts merely by alleging accounting irregularities.

The requested measure must be connected to a legally protected claim and satisfy the applicable requirements for interim protection.

Shareholder Litigation May Follow

Depending on the facts, possible disputes may concern director liability, invalid corporate resolutions, recovery of company assets, shareholder rights or other corporate-law remedies.

The correct claimant must also be identified because some losses belong to the company rather than directly to an individual shareholder.

Direct Loss and Company Loss Must Be Distinguished

If a director transfers corporate money improperly, the immediate financial loss may belong to the company.

A foreign shareholder’s reduction in share value does not necessarily mean every claim can be brought directly in the shareholder’s own name.

This distinction is important when structuring litigation.

Criminal Issues May Also Arise in Serious Cases

If evidence indicates intentional falsification, destruction of records, misappropriation or other potentially criminal conduct, separate criminal-law questions may arise.

A commercial disagreement or accounting irregularity should not automatically be characterized as a crime without supporting evidence.

Do Not Make Criminal Allegations Without Reviewing the Evidence

Foreign shareholders should first preserve bank, accounting, contractual and electronic evidence.

Unsupported accusations can complicate settlement negotiations and subsequent proceedings.

Review the Company’s Articles and Shareholders’ Agreement

Contractual rights may supplement statutory shareholder protections.

The shareholders’ agreement may contain audit rights, financial-reporting obligations, reserved matters, information rights, board representation or dispute-resolution clauses.

Foreign Shareholders Should Preserve Their Own Records

Keep capital contribution documents, share purchase agreements, previous financial statements, board materials, emails, management reports and correspondence with accountants.

These documents may help reconstruct what management previously represented about the company.

Compare Historical Financial Statements

Look for sudden changes in receivables, inventory, cash, related-party balances, debt or expenses.

Large movements can identify periods requiring closer investigation.

Independent Forensic Accounting May Be Useful

Where the missing records involve significant amounts, a forensic accountant can reconstruct transactions using bank records, invoices, tax information and available accounting data.

Legal and accounting teams should coordinate so that the investigation produces evidence useful in potential proceedings.

Foreign Investors Should Act Before Assets Disappear

The practical danger is not only missing accounting records. If the records disappeared because a wider shareholder dispute is developing, corporate assets may also be transferred.

Asset and evidence preservation should therefore be considered together.

Immediate Action Plan for Foreign Shareholders

A foreign shareholder discovering missing or destroyed accounting records should immediately identify the missing periods and documents, submit a formal information request, preserve remaining electronic evidence, obtain available financial statements and bank information through lawful channels, investigate backups and external accounting copies, review related-party transactions, reconstruct significant payments, examine corporate resolutions, evaluate special audit and evidence-preservation mechanisms and consider interim measures where concrete evidence shows an immediate risk to corporate assets.

Frequently Asked Questions

Can a foreign shareholder inspect a Turkish company’s accounting records?

Shareholder information and inspection rights depend on the company’s legal form, applicable statutory requirements and circumstances. The shareholder should use the appropriate corporate-law mechanism rather than assuming unrestricted access to every internal document.

What if management says all accounting records were accidentally destroyed?

The cause of destruction should be documented and backup, banking, tax, electronic invoice and external accountant records should be investigated.

Can missing records be reconstructed?

Often, at least partially. Bank statements, electronic invoices, tax records, contracts, counterparties and digital backups may provide alternative evidence.

Does destruction of accounting records automatically prove fraud?

No. The reason for the loss and surrounding circumstances must be investigated.

Can directors be personally liable?

Potentially, where the applicable requirements for director or manager liability are established. The specific breach, loss and causal relationship must be analyzed.

Can a foreign shareholder request a special audit?

Potentially, subject to the requirements applicable to the company and circumstances. A targeted investigation of specific corporate matters is generally more useful than an undefined request to investigate the entire business.

Can company bank accounts be frozen?

Interim measures may potentially be available where the applicable legal conditions are established, but accounting concerns alone do not automatically justify freezing corporate accounts.

Can the shareholder sue for money removed from the company?

Potentially, but it is essential to determine whether the relevant loss legally belongs to the company or directly to the shareholder.

Can missing accounting records create criminal liability?

Serious intentional conduct may raise criminal-law issues depending on the facts. Ordinary bookkeeping errors or accidental document loss should not automatically be characterized as criminal conduct.

What should a foreign shareholder do first?

Preserve the evidence that still exists. Identify precisely which records are missing, secure available digital and financial information, formally request explanations from management and reconstruct the largest or most suspicious transactions before deciding which corporate, civil or criminal remedies are appropriate.

Client-Focused Legal Support for Foreign Shareholders in Turkey

Missing company records can indicate anything from poor administration to a serious shareholder dispute involving hidden payments, related-party transactions, unauthorized asset transfers, director liability and loss of corporate value.

Fırat Fesih Kaya Law Office assists foreign shareholders and international investors in Turkish corporate disputes. Lawyer Fırat Fesih Kaya provides legal assistance concerning shareholder information rights, missing accounting records, management accountability, special audit procedures, evidence preservation, interim measures, director liability and litigation involving suspected misuse of company assets.

Phone:
+90 312 434 22 22

Mobile:
+90 532 769 22 22

Email:
info@firatfesihkaya.av.tr

Address:
Mevlana Boulevard No:221, Yıldırım Tower, Office No:148
06520 Balgat, Çankaya, Ankara, Turkey