Watchdog Agency Tightens Audit Rules

The Financial Supervisory Commission said Wednesday that it would tighten rules to ensure that corporations make financial statement information available to auditors.

Chairman Lee Keun-young of the regulatory agency said that companies that fail to provide sufficient documentation and information to independent auditors, whether intentionally or not, will be considered in violation of the commission's corporate disclosure requirements.

Punitive measures will be taken against companies that receive a qualified opinion on financial statements due to a scope limitation in an audit. Companies that received qualified opinions because the financial statements were not in conformity with generally accepted accounting principles but subsequently submit corrected statements will not be penalized, Mr. Lee said.

Mr. Lee also said that auditors holding shares in client companies will be banned from performing those companies' audits.

by Chung Sun-gu