Deloitte Anjin declines auditing opinion on Daewoo E&C Q3 financial results

Deloitte Anjin LLC, the independent accounting firm whose former executive had been indicted by the prosecution as accomplice to window-dressing and accounting fraud committed by Daewoo Shipbuilding & Marine Engineering Co., issued a disclaimer of opinion, or refusal to present an opinion on the third-quarter financial statement of Daewoo Engineering & Construction Co.

According to disclosure filed to the Financial Supervisory Service on Monday, the accounting firm declined to issue its auditing opinion on the constructor’s third-quarter financial statements, citing it was not given sufficient and appropriate evidence to support the integrity of major items in the statements such as construction income, unclaimed/overclaimed construction bills and finalized contract assets/liabilities. There are four types of audit reports issued by an independent accounting professional: unqualified, qualified, adverse opinions and disclaimer of opinion.

Anjin’s disclaimer of opinion warns investors that Daewoo E&C’s financial statements for the July-September period provided by the company did not have second look and validation.

Deloitte Anjin is under pressure for its suspected conspiracy with Daewoo Shipbuilding & Marine Engineering in accounting fraud. Deloitte Anjin was the external auditor for the shipbuilder from 2010 to 2015 and is under criminal investigation on charges that it condoned the shipbuilder’s cover-up of huge losses each year.

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