Allerged Accounting Fraud: FSS to Discuss Conducting Special Audit on Samsung BioLogics’s Accounting Fraud | BusinessKorea

Thursday, April 27, 2017

The Financial Supervisory Service (FSS) will discuss whether or not to conduct a special audit with relevant organizations in relation to an allegation about Samsung BioLogics’s accounting fraud.
The Financial Supervisory Service (FSS) will discuss whether or not to conduct a special audit with relevant organizations in relation to an allegation about Samsung BioLogics’s accounting fraud.
SEOUL,KOREA
17 February 2017 - 12:15pm
Jung Suk-yee

Jin Woong-seop, chairman of the Financial Supervisory Service (FSS) said on February 16 that the FSS will discuss whether or not to conduct a special audit with relevant organizations in relation to an allegation about Samsung BioLogics’s accounting fraud.

"Multiple reviews found out that there were no problems," said chairman Jin in a report during a meeting of the National Policy Committee at the National Assembly on the day. But as committee members showered chairman Jin with a myriad of questions, "I will consult with the Securities and Futures Commission and the Korean Institute of Certified Public Accountants."

Currently, there is an allegation that the Korea Exchange changed its rules for the listing of Samsung BioLogics. Samsung BioLogics, which had posted deficits for four years until 2014 since its foundation in 2011, netted 1.9 trillion won in 2015 just before being listed on the KOSPI. This is because, under the revised listing rules, the corporate value of Samsung Bioepis, a subsidiary of Samsung BioLogics was based on at its fair value, not its book value. Accordingly, it is being pointed out that the Financial Supervisory Commission changed its accounting standards to give a special advantage to Samsung BioLogics for its listing and inflate its value and the National Pension Service used the value as a basis for its approval of a merger between two Samsung affiliates.

"I think it is not desirable for excellent companies to go to overseas stock markets because listing requirements are profit-oriented," expatiated Lee Jong-ryong, chairman of the Financial Supervisory Commission (FSC) who attended a briefing session. “The revision of the regulation was not a special favor.” 

 

 

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