KB strengthening its internal auditing processes

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KB strengthening its internal auditing processes

Korea’s largest lender by assets, KB Financial Group, announced plans to strengthen its internal control including an expansion of its audit department in order to prevent any financial accidents.

According to the financial group Monday, one of its first steps in improving its internal control is doubling the size of the auditing department.

Additionally, it is changing its information reporting process. Affiliates will directly report vital information to the holding company’s auditing committee.

In the past, affiliates conducted their own auditing without reporting to the holding company.

For more active participation by high ranking executives, the financial group has expanded the evaluation review categories on internal control of CEOs from each affiliate.

Another measure is forcing employees to go on “ordered leaves.” This would allow another employee covering for the employee on leave to review the work he or she has been doing. Previously, employees went on ordered leaves around the time of regular holidays or on extensive leaves for training or studying. This allowed the employees to prepare for international auditing.

KB also said it will encourage more internal whistle-blowing by creating an external channel that will allow employees to report illegal activities with their anonymity protected. It will also create a reporting channel through which employees can report misconduct to the CEOs of affiliates directly.

Other efforts that the financial group will take include reforming its sales network system.

The group said the changes including reorganizing its sales networks come after the recent voluntary retirements of 1,122 employees.

“We expect that our efforts in strengthening the various internal controls will help prevent any financial accidents,” said a group official.

BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]
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