Aims to address prolonged designated audit periods, frequent replacement of auditors, grant incentives to excellent value-up companies in terms of disciplinary measures.
Follows SK FSS Dec. 2024 said designation will be deferred by 3 years, see #239026.
Also follows SK FSC Feb. 2025 issued capital market policy directions, see #244522.
Outline of Revisions
Specify 17 evaluation items for 5 accounting/audit governance evaluation areas to defer periodic designation; where it is difficult to immediately meet evaluation criteria, alternative means, such as amendment of the articles of incorporation, are permitted.
Set up an accounting/audit governance evaluation committee to evaluate corporate governance structure for selecting companies subject to periodic designation deferral.
Even if a reason for ex officio designation arises in the periodic designation period, the current auditor can continue to audit without extending the designation period, in cases where reason is not related to the auditor, accounting fraud, or poor auditing.
Adjust weighting by company size, which is applied to the auditor designation method.
Introduce an extension option to enable unlisted companies to receive a designated audit from the same auditor for three years at a designated time if they so choose.
Establish a legal basis to reduce the severity of disciplinary measures to be taken based on audit results for companies awarded for excellence in corporate value-up.
Consultation Period
Comments shall be submitted by Apr. 28, 2025.
Regulators
SK FSC; SK FSS
Entity Types
Auditor; Corp
Reference
CP, Nt 2025-9, PR, 4/15/2025; Reg, Nt 2023-60, 12/19/2023; ESG
