Accounting & audit in Korea

An external audit is required in Korea in the following cases:

For a stock company, meeting any of the following three criteria:

• A stock-listed company (Stock market, KOSDAQ, KONEX) or a company to be listed
• A company with at least KRW 50 billion in total assets or sales at the end of the last business year
• A company meeting two or more of the following four requirements at the end of the last business year:
  • Total assets are KRW 12 billion or above
  • Total liabilities are KRW 7 billion or above
  • Total sales are KRW 10 billion or above
  • The number of employees is 100 or above

For a limited company, meeting any of the following two criteria:

• A company with a least KRW 50 billion in total assets or sales at the end of the last business year
• A company meeting three or more of the following five requirements at the end of the last business year:
  • Total assets are KRW 12 billion or above
  • Total liabilities are KRW 7 billion or above
  • Total sales are KRW 10 billion or above
  • The number of employees is 100 or above
  • The number of unitholders is 50 or above

Audit contract

Companies subject to compulsory external audits during the year have to sign their audit contract by 14 February. The contract has to be submitted to the Financial Supervisory Service within 14 days after the signature of the contract. However, there is an exception for first-time audits whereby the audit contract has to be signed by 30 April.