Transition Team: "Board of Audit and Inspection Reports 2 Trillion Won-Scale Financial Management Lapses"

[Asia Economy Reporter Bae Kyunghwan] The Presidential Transition Committee (Transition Committee) announced on the 21st that it received a report from the Board of Audit and Inspection regarding mismanagement issues amounting to 2 trillion won related to the fiscal operations of the Moon Jae-in administration.

On the same day, Won Il-hee, the chief deputy spokesperson of the Transition Committee, stated in a briefing, "The title of the report submitted by the Board of Audit and Inspection is 'Audit on Wasteful Fiscal Management,' which explains that the audit was conducted due to the sharp increase in national debt caused by the expansionary fiscal operations over time."

It was confirmed that the Board of Audit and Inspection reported during the Transition Committee's Political, Judicial, and Administrative Affairs Subcommittee briefing on the 25th of last month that mismanagement issues were detected in about ten projects worth around 2 trillion won. When project costs increase beyond a certain percentage, separate management is required, but about ten projects were excluded from such oversight.

Chief Deputy Spokesperson Won explained, "The audit was not conducted recently but over three stages during the past three years," adding, "The subjects were 16 institutions including the Ministry of Economy and Finance, and the audit involved step-by-step and project-type analyses of fiscal operations." He further added, "The Board of Audit and Inspection conducted the audit from September 27 to December 12, 2021, and is currently processing the results including the preparation of the audit report. The final results will be submitted to the Audit Committee, and once the audit report is approved, it will be finalized."

However, it was conveyed that this audit is unrelated to projects exempted from preliminary feasibility studies (PFS). Chief Deputy Spokesperson Won stated, "Projects exempted from PFS are not subject to audit," and added, "Audits are only possible if there are issues with total project cost management guidelines, such as mismanagement after passing the PFS or increases in budget after PFS exemption."

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