L&K Biomed Resolves Accounting Issues with Strong Management Improvement Measures... Ensures Accounting Transparency

The Securities and Futures Commission Notifies Gross Negligence Determination on 2017-2018 Australia Revenue Recognition Issue

[Asia Economy Reporter Hyungsoo Park] L&K Biomed announced on the 2nd that it received a 'Gross Negligence Level II' judgment and a fine of 326 million KRW from the Securities and Futures Commission for violations of accounting standards, including excessive revenue recognition, pointed out during the investigation and audit of the 2017 and 2018 business reports and audit reports.

The accounting standard violations for L&K Biomed in 2017 and 2018 correspond to a re-examination from an accounting perspective of the errors in revenue recognition timing related to the Australian market, which were pointed out when the Korea Exchange imposed a trading suspension in March 2019.

At the time of the 2019 audit, L&K Biomed voluntarily corrected the accounting errors. The company improved issues in its internal accounting control system and diligently carried out management improvements. Trading resumed on May 4 of last year.

The management of L&K Biomed humbly accepted the measures following the audit results and once again expressed regret to shareholders, investors, and employees. They stated their intention to devote themselves to responsible management to ensure greater transparency in the future.