Samsung BioLogics Co. reiterated innocence against accounting wrongdoing charges by Korean authorities, while apologizing for upsetting and inconveniencing shareholders.
“We deeply regret the findings of the Securities and Futures Commission (SFC) as we are confident that our accounting treatment has been proper under the Korean-International Financial Reporting Standards (K-IFRS),” Kim Tae-han, CEO of the contract drug arm of Samsung Group, told shareholders in a letter.
“We filed an administrative lawsuit against the SFC to win recognition on legitimacy in our accounting practice,” said Kim, who has been ordered to step down by the financial authority to take responsibility over the wrongdoing.
The company is putting out efforts to cooperate with the listing maintenance review performed by the Korea Exchange “so that trading will be resumed as soon as possible.”
The SFC, the top decision-making board of Financial Services Commission, ruled that Samsung BioLogics intentionally violated accounting rules in 2015 by inflating its net profit ahead of going public and referred the case to the prosecution for criminal charges. Shares of Samsung BioLogics were immediately suspended from the main Seoul bourse, prompting concerns in the local financial market.
In response to the ruling, Samsung BioLogics this week filed an administrative lawsuit against the financial authority to gain court injunction on the remedial order.
“We apologize for any inconvenience that you have suffered in exercising property rights as a result of the suspension of trading of shares,” Kim said. He persuaded investors to maintain confidence in the company as it holds cash reserve of more than 1 trillion won ($892.2 million)
Kim assured shareholders that it is unlikely that the recent issue will “impact our corporate values or daily business operations,” and that it will “endeavor to raise shareholder value by providing quality service” and “continuing to expand business.”
By Kim Byung-ho and Lee Eun-joo
[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]