Hangonghoe Holds 2nd Value Evaluation Forum... Discussing Legal Issues

[Asia Economy Reporter Lee Jung-yoon] The Korean Institute of Certified Public Accountants announced on the 12th that it held the '2nd Valuation Forum' to discuss major legal issues related to the valuation work of accounting firms.

At the forum held the previous day, Professor Ahn Tae-joon of Hanyang University Law School gave a presentation on the topic of 'Legal Liability Related to the Valuation Work of Accounting Firms.' Professor Ahn pointed out problems with applying the violation of the Certified Public Accountant Act due to falsehood in valuation work, explaining that valuation inherently involves the appraiser's reasoning and estimation, with broad discretion recognized, and that it is inappropriate to judge valuation results, which are closer to opinions than facts, as true or false.

He further analyzed that other institutions such as credit rating agencies and securities companies can also perform valuations, so punishing only certified public accountants under the Certified Public Accountant Act for false reporting is unfair and poses a risk of excessive expansion of criminal penalties. Professor Ahn proposed measures to secure the appropriateness and fairness of valuation work by establishing administrative sanctions or self-regulation by related associations rather than criminal punishment.

Professor Kim Jong-il of Catholic University and Park Dae-joon, head of the deal division at Samil Accounting Corporation, expressed concerns in the discussion about the law deeply intervening in the valuation field where expert discretion is widely used. They also judged that valuation is becoming increasingly complex and specialized by industry and valuation target, making it impossible to define and regulate it through laws and regulations. They agreed that various valuation experts should perform practical work in each field, be verified, and have their expertise recognized in the market.

Kim Young-sik, chairman of the Korean Institute of Certified Public Accountants, stated in his opening remarks, "Through this forum, we expect to share academic research results on legal liability related to valuation, which will be helpful not only to certified public accountants engaged in valuation work but also to related policymakers."