[Financial Tips] "Priority Check the 'Auditor's Opinion' at the Beginning of the Audit Report"

[Asia Economy Reporter Minji Lee] The Financial Supervisory Service (FSS) provided guidance on the 19th for investors who find it difficult to utilize the newly revised audit reports with updated content and format, on how to check the key information in the audit reports.

First, the FSS advised to first check the 'Audit Opinion' at the very beginning of the audit report. The audit opinion is divided into four types (unqualified opinion, qualified opinion, adverse opinion, disclaimer of opinion) depending on whether the company's financial statements are appropriately presented according to accounting standards.

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The FSS emphasized, "An unqualified opinion is an opinion expressed when the company's financial statements are judged to be appropriately presented according to accounting standards, but it does not guarantee that the company's business performance or financial soundness is favorable." In the case of non-unqualified opinions (qualified, adverse opinion, disclaimer of opinion), there may be risks such as suspension of stock trading or delisting, so special caution is required, and it is explained that the reasons and grounds can be checked through the 'Basis for Audit Opinion.'

To understand the company's significant accounting and audit issues, it was advised to review the key audit matters selected by the auditor. Related information is also recorded in the notes to the financial statements, and more detailed information can be obtained by referring to the notes together.

It was also emphasized that companies with uncertainties related to going concern should be especially cautious. This means that unpredictable future events or conditions may occur that could negatively affect the assumption that management will continue the business without the intention to liquidate the company or cease operations.

The FSS stated, "This year, uncertainties related to going concern may increase due to prolonged economic and business downturns caused by COVID-19, so attention should be paid to related content," and added, "It is also necessary to check whether the company is preparing appropriate measures such as capital increases or asset sales."

Finally, it was said that the contents listed as emphasized matters should also be reviewed. The FSS explained, "Since situations such as changes in the business environment like mergers, significant lawsuits, and the impact of COVID-19 that could have important effects on the company's future financial condition and business performance are recorded, they should be carefully checked."

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