[THE INVESTOR] The Securities and Futures Commission is planning to look into the financial statements of contract drugmaker Samsung BioLogics before 2015, which is when the firm posted the controversial 1.9 trillion won (US$1.76 billion) surplus by adopting the International Financial Reporting Standards.
“We understand that the commission is planning to look further into the past, before the year 2015,” said one source close to the matter declining to be identified. The SFC could not be reached for comment.
By comparing the two different sets of records, the authorities are hoping to detect if Samsung BioLogics intentionally inflated the revenues of its affiliate Samsung Bioepis to lift its value ahead of its public offering in 2016.
The SFC is the auditing and decision-assisting arm of the Financial Supervisory Commission that has been reviewing whether Samsung BioLogics violated certain accounting rules when it reflected Samsung Bioepis’ unearned, but anticipated revenues,
Samsung BioLogics argues that not only were the revenues were legally reflected, but that the authorities and accounting companies at the time had all accepted the 2015 records.
Due to the controversial nature of the issue – the government is against fierce protest from not only Samsung and the business sector, but the millions of investors who at one point saw the market cap of Samsung BioLogics wiped out by more than 4 trillion won – the commission on June 12 held an unplanned meeting with the related parties including Samsung BioLogics.
Another meeting between the authorities and Samsung BioLogics is scheduled for June 20.
By Park Han-na (email@example.com)