Eastar Jet AOC in jeopardy after financials are questioned
Eastar Jet will be audited for submitting false documents to obtain government approval to resume flights.
The Ministry of Land, Infrastructure and Transport announced Tuesday it found that Eastar Jet submitted false accounting documents. The documents were used to determine if the ministry could issue a new international air transport license.
The license was issued last December and is necessary to re-obtain air operator certificate (AOC) approval, the final step needed to resume flights.
Debt-ridden Eastar Jet suspended flights in March 2020, and its AOC became ineffective in May the same year. Exiting the court-led debt-rescheduling in March, it has been working on re-obtaining the AOC.
According to the ministry, documents submitted by Eastar Jet last November stated the company had deficit of 199.3 billion won.
According to the Financial Supervisory Service (FSS), Eastar Jet had a deficit of 485.1 billion won.
The ministry announced the difference in the two deficit figures was too big, and that it was investigating Eastar Jet.
“We will look into whether Eastar Jet violated any laws throughout the entire process of getting its new international air transport license,” said Won Hee-ryong, Minister of Land, Infrastructure and Transport, in a statement on Tuesday. “We will take strict actions based on our findings.”
Regarding the ministry’s claims, Eastar Jet blamed its accounting system.
The carrier released a statement Tuesday, saying it didn’t have access to its online accounting system between June 2020 and February this year because it couldn’t pay usage fees to company offering the cloud services.
Unable to access its accounting system, deficit figures submitted to the ministry were based on May 2020 numbers. Eastar Jet said it was the most recent figure it had access to at that time.
The deficit reported by the FSS was different from what it submitted to the ministry because the company regained access to its accounting system in February, and was able to provide accurate numbers.
Eastar Jet said it will do its best to explain its situation to the ministry, aiming to obtain AOC to resume business.
BY LEE TAE-HEE [email@example.com]