Gangwon Files Objection to 'Qualified Opinion'... "Will Do Our Best for Prompt Resumption of Transactions"

[Asia Economy Reporter Koo Eun-mo] Gangwon announced on the 6th that it will initiate procedures to file an objection regarding the qualified opinion received in last year's audit report and to resolve the reasons for the trading suspension. In particular, the company plans to mobilize various methods, including consulting external experts, to fully commit to a swift resolution of the situation and the resumption of trading in order to protect shareholder value.

Since the issue stems from an equity-method affiliate unrelated to the financial statements or business status of the main business, Gangwon intends to concentrate all its capabilities on a prompt resolution. To this end, the company will closely cooperate with external auditors and the Korea Exchange, and will not hesitate to provide additional materials and cooperate according to the opinions presented by the accounting firm.

A company official stated, “We sincerely apologize for causing concern to Gangwon shareholders due to the rejection of the audit opinion of our affiliate SD System,” and added, “We will do our best not only to resolve the reasons for the trading suspension, including the opinions presented by the external auditors, but also to receive an unqualified opinion through a re-audit.”

On the 3rd, Gangwon submitted an audit report containing a “qualified opinion due to scope limitation” regarding the financial statements for the 2019 fiscal year to the Korea Exchange from an external auditor. This was because sufficient and appropriate audit evidence could not be secured concerning the financial information and impairment test results of SD System, an affiliate in which Gangwon invested 14.5% in December last year, resulting in the failure to receive an unqualified opinion.

Along with filing an objection and promoting a re-audit, Gangwon plans to take this incident as a lesson to review the company’s management status and business structure and lay the groundwork for a new start. The company explained that the operational performance of existing businesses is becoming visible, and the bio-platform business, which is being promoted as a new business, is progressing smoothly, aiming to repay shareholders’ support with tangible results.

A company official said, “We should have conducted a more thorough review during the equity investment process and prevented unforeseen risks, but this unexpected situation caused concern to our shareholders,” and added, “We will focus on practical problem-solving such as the prompt resumption of trading and take responsibility for any issues that the management should be accountable for in the future.”

This content was produced with the assistance of AI translation services.