External auditors’ independence

We commit to enhance integrity in the private sector by guaranteeing outside auditors’ independence for stronger business accounting transparency and by taking business accounting compliance data into account in the selection of subjects of government regular tax audit.

Completion Status:
Partially fulfilled

Commitment filtering:

Specific: ✔ yes

This commitment is specific as it aims to enhance integrity in the private sector and to increase business accounting transparency. It aims to strengthen the independence of external auditors, and to enhance integrity in the private sector by taking accounting transparency data into account during the selection of regular tax investigation targets.

Measurable: ✔ yes

We can measure whether the relevant instruments and efforts to enhance integrity in the private sector were adopted, such as guaranteeing external auditors’ independence for stronger business accounting transparency and by taking business accounting compliance data into account in the selection of subjects for regular government tax audits.

Last updated: 30 November 2020
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Evaluation:

This commitment was announced by ACRC as part of the five-year comprehensive anti-corruption plan. The recommendations to enhance the integrity of private sector, including strengthening the independence of outside auditors, have been implemented to a certain extend. For example, to strengthen independence of auditors the Act on External Audit of Stock Companies was amended in November 2018.1 According to the information provided by the ACRC, in November 2019, the Securities and Futures Commission designated outside auditors for total 220 listed companies including Samsung Electronics.

Opportunities to accelerate commitment implementation
The five-year comprehensive anti-corruption plan should be further used to enhance integrity in the private sector

Recommendations
Further enhance integrity in the private sector by guaranteeing external auditors’ independence for stronger business accounting transparency

Sources:
  1. Kim & Chang, Enforcement of Act on External Audit of Stock Companies, etc. and Amendments to Enforcement Decree and Rule Thereof, 9 November 2018 https://www.kimchang.com/en/insights/detail.kc?sch_section=4&idx=18804
    9 November 2018
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