Sangjang Association and Deloitte Anjin Hold Seminar on Strengthening Corporate Internal Accounting Control System Disclosures Next Year

The Korea Listed Companies Association announced on the 20th that it jointly held a seminar with Deloitte Anjin on 'Internal Accounting Management System Evaluation, Reporting Guidelines, and Measures to Respond to Fraud Cases Related to Funds.'

Under the current system, many companies submit both an operational status report and an operational evaluation report in their business reports. However, concerns have been raised about the effectiveness due to limitations in the format and specificity of the disclosed content. Accordingly, measures to strengthen the disclosure of the internal accounting management system have been introduced, and new disclosure formats for the Internal Accounting Operation Status Report and the Internal Accounting Evaluation Report have been established.

The enhanced system will be applied from the fiscal year starting January 1 of next year. The revised Internal Accounting Operation Status Report requires clearer disclosure of internal control activities to prevent fund-related fraud such as embezzlement by management, thereby strengthening the responsibilities and roles of management. Furthermore, it is expected to significantly improve the transparency of corporate internal control systems and the efficiency of fund management.

This seminar focused on strengthening internal control activities for the prevention and response to fund-related incidents, centered on the recently revised standards for evaluating and reporting the internal accounting management system. In particular, it provided specific examples and guidelines on 'the company's internal control activities to respond to embezzlement and other fund-related fraud risks,' aiming to resolve confusion among listed company practitioners and offer practical application methods.

The seminar consisted of three sessions. In the first session, Oh Hyun-kyung, an investigator from the Financial Supervisory Service, introduced 'the evaluation and reporting standards for the internal accounting management system, the scope of consolidated evaluation, and key guidelines.' In the second session, Jung Hyun, leader of the Internal Accounting Management System Task Force (TF) at Deloitte Anjin Accounting Firm, gave a lecture on 'Responses to Fund-Related Fraud Risks and Internal Control Cases.' In the final session, Lee Seung-young, senior advisor at Deloitte Anjin Accounting Firm, explained 'Fund-Related Fraud Cases and Response Measures' based on past statistics.

Notably, participants of this seminar had the opportunity to use Deloitte Anjin Accounting Firm’s fund-related control diagnostic solution, 'Light House,' free of charge, in line with the strengthened fund-related control activities under the revised internal accounting management system.

Jung Hyun, leader of the Internal Accounting Management System TF at Deloitte Anjin Accounting Firm, stated, "Disclosures related to funds such as embezzlement are expected to be strengthened in the operation status report. This seminar has been greatly helpful in understanding in detail the control activities and disclosure formats that must be performed to address fund-related fraud risks such as embezzlement, and in seeking practical response measures. It will be an important opportunity to provide practical information and guidelines for listed company practitioners to effectively respond to these changes."