A total of 33 companies face the prospect of being delisted from the South Korean stock market due to poor financial health, the bourse operator said on April 2.
After reviewing corporate business reports for 2018, the Korea Exchange said it has found reasons for the possible delisting of five companies traded on the country’s main Kospi bourse and 28 entities on the secondary Kosdaq market.
Of the total, 22 firms received substandard opinions, which include disclaimers of opinion, from independent auditors on their financial statements, and one failed to meet the conditions for share distribution for a second consecutive year, according to the KRX.
A disclaimer of opinion is given when an auditor has not been able to obtain appropriate audit evidence and is unable to express an opinion on the financial statements.
If the companies submit a complaint, they can secure a one-year grace period before coming under review for delisting, the KRX noted.
By Ram Garikipati and newswires (email@example.com)