South Korea’s financial watchdog is considering a special audit of GS Engineering & Construction Co., the fourth-largest builder, over an accounting fraud allegation, an industry official said Sunday.
“We are reviewing whether the special audit on GS is needed or not as a petition for an audit on GS by a civic group has been accepted,” the official at The Financial Supervisory Service said on condition of anonymity.
“After confirming the details related to the allegation of GS’s accounting fraud, the watchdog will decide on whether to carry out the audit or not.”
GS Engineering & Construction disclosed that it registered 1.82 trillion won ($1.6 billion) in sales and 535.5 billion won in operating losses in the first quarter of this year.
The builder said that the massive operating loss took place as increased costs in overseas orders and environmental projects that it won in the past were reflected in its operating profit in the first quarter.
However, the Solidarity for Economic Reform asked the watchdog to conduct a special audit on the company, claiming that the loss seems to have been caused due to the company’s violation of accounting rules. (Yonhap News)
