[Accounting Society President Election] Choi Jong-man "For Family Harmony, Both Older and Younger Brothers Must Prosper... Will Find Industry Win-Win Solutions"

Candidate No. 3 Choe Jong-man, CEO of Shinhan Accounting Corporation

[Asia Economy Reporter Ji-hwan Park] "Looking at just one family, it's not enough for only the eldest sibling to succeed; the younger siblings must also do well for there to be no problems."

Choi Jong-man, CEO of Shinhan Accounting Corporation, said in an interview with Asia Economy on the 3rd, "With the introduction of the new External Audit Act, large accounting firms have seen improvements, but small and medium-sized accounting firms and audit teams have lost work," adding, "The industry needs to find ways to coexist."

He emphasized, "Regarding the reduced workload, measures should be put in place to enable other activities. If in one household the eldest sibling is doing well but the younger ones are poor, that becomes a significant issue. Companies facing increased audit burdens are preparing to resist, so internal turmoil must be avoided."

Choi also stated that regulations such as the statute of limitations on auditors' liability for damages and fines should be eased. He pointed out, "Currently, the statute of limitations for damages is 8 years, but considering that the general commercial statute of limitations is 5 years, auditors bear an unusually heavy burden." The long statute of limitations means auditors remain in an unstable state exposed to risks like lawsuits for an excessively long time.

He criticized, "The fine regulation is set at up to five times the audit fee. For example, if an audit worth 100 million KRW is conducted, a mistake could mean paying 500 million KRW in compensation," adding, "For small and medium-sized accounting firms, such mistakes could lead to immediate closure." Punitive damages have not yet been introduced domestically, but excessive responsibility is being imposed solely on auditors.

Choi criticized, "It is like saying that if a police officer fails to catch a murderer but the criminal is later caught and sentenced to life imprisonment, the officer should also receive life imprisonment."

He also promised to reform the auditor compensation system. He added, "Currently, auditor fees are based on performance, which can be applied to large firms like the Big 4, but for small and medium-sized accounting firms, a separate fee calculation standard suited to their reality must be established."

Regarding the number of certified public accountants selected, he emphasized the need to consider long-term demand forecasts. He said, "In the past, the number of successful candidates was in the hundreds, but now it exceeds 1,000," adding, "If the market is struggling to survive, proper audits cannot be conducted." He pointed out, "Various variables such as the reduction in demand due to the replacement of much audit work by computerized techniques must be comprehensively analyzed."