Audit opinions on both financial statements and internal accounting control systems improved at companies listed on South Korea's main and junior stock markets, according to an industry analysis. The number of listed firms receiving non-clean opinions on their financial statements fell to 53, while the share of non-clean opinions on internal accounting controls dropped to its lowest level in six years.
The Korea Listed Companies Association said on the 6th that 53 companies, or 2.1%, received non-clean audit opinions on their financial statements, based on its review of 2,485 companies listed on the KOSPI and KOSDAQ markets with December fiscal year-ends as of the end of 2025. That was down from 56 companies, or 2.3%, a year earlier, a decline of three firms and 0.2 percentage point. The remaining 97.9% of listed firms received clean opinions.
The number of companies receiving non-clean opinions on their internal accounting control systems also fell, to 70, or 2.8%, from 75, or 3.1%, a year earlier. The ratio has declined steadily from 3.8% in 2020 to 3.2% in 2021 through 2023, 3.1% in 2024 and 2.8% last year — the lowest level in the six years since 2020.
The improvement was most pronounced among companies with assets of at least 100 billion won, which are subject to full audits of their internal accounting controls. Non-clean opinions in that group fell to 25, or 1.5%, from 31, or 1.9%, a year earlier. By contrast, among companies with assets below 100 billion won, which face reviews rather than audits, cases rose slightly to 45, or 5.3%, from 44, or 5.2%.
Large listed companies posted clean opinions across the board for a second straight year. None of the 201 listed firms with assets of 2 trillion won ($1.4 billion) or more received a non-clean opinion on either their financial statements or their internal accounting controls. Of those, the 197 subject to audits of consolidated internal accounting controls all received clean opinions, marking a 100% clean rate for the second consecutive year.
Companies' own self-assessment functions also showed signs of improvement. Among the 70 firms that external auditors flagged with non-clean internal accounting opinions, 20.0% had rated themselves as deficient, up 12.0 percentage points from 8.0% a year earlier. The share in which auditors or audit committees issued a negative assessment rose 12.2 percentage points to 22.9% from 10.7%. The association said the gap between companies' internal assessments and external auditors' judgments had narrowed somewhat.
By cause, accounting issues accounted for 106 cases, down 15.9% from a year earlier, while internal control issues rose 7.8% to 166 cases. Within internal control issues, weaknesses in controls over the financial reporting process were the most common, at 38 cases, or 22.9%. The association said practical improvements, including stronger closing infrastructure and additional staffing, were needed.
