Irem: "The fine is a result of accounting treatment before acquisition... unrelated to the current management"

Irem recently stated on the 3rd regarding the fine imposed by the Financial Services Commission, "This measure is solely the result of past accounting practices by the former owner and is unrelated to the current management."

The day before, the Financial Services Commission imposed a total fine of 1.02 billion KRW on Irem and five individuals, including the former CEO, for violations of accounting standards. The Commission determined that in the consolidated financial statements from 2019 to 2020, the value of investment stocks in affiliated companies was overstated, inflating net income. The issue was pointed out because the affiliated company in question had recorded operating losses for several years, yet the business plan reflected an unsubstantiated sharp increase in future sales.

In response, an Irem representative explained, "All the problematic accounting treatments occurred before the acquisition," adding, "The current management had no involvement whatsoever in the preparation of those financial statements." In fact, Kostil Holdings, the current largest shareholder of Irem, secured management rights by acquiring Kosen, the company’s former name, in March 2022.

The Irem representative further stated, "Since the acquisition, we have adhered to principles of transparent accounting and responsible management, thoroughly inspecting and strengthening our internal accounting control systems," adding, "We believe that the risks originating from the former owner have been completely resolved."

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