An unexpected event occurred on June 19th last year when I took office. The Seoul City Council amended the ordinance to allow a tax accountant to take charge of the financial audit of private consignment projects. Furthermore, the Supreme Court supported this decision, leaving us in a difficult situation on how to reverse it. Nevertheless, I met with each member of the Seoul City Council one by one to persuade them, and ultimately this March, the ordinance that seemed impossible was restored to its original state.
Choi Woon-yeol, president of the Korea Certified Public Accountant Society (KICPA), noted on the 11th during a press briefing held in Yeouido, Yeongdeungpo-gu, Seoul, marking his one-year anniversary in office, that he reflected on the past year. Previously, the Seoul City Council changed the name of the ‘financial audit’ of private consignment service providers, which could only be performed by accounting firms, to ‘business expense settlement inspection,’ allowing tax accountants to also perform it.
Choi emphasized that prioritizing the proposal to amend local government law to require audits for projects above a certain scale was his top task. He said, “In addition to Seoul, similar ordinances are being proposed in metropolitan local governments nationwide. Recently, a similar issue almost arose in the Gyeonggi Provincial Assembly, but I visited the local National Assembly member early in the morning to persuade them, resulting in the deliberation being postponed.”
He added, “The work of accountants and tax accountants is fundamentally different, much like the difference between a doctor and a veterinarian,” saying that he thought there was a need for legislation to fundamentally solve this issue. He stated, “I will do my best to have it pass through the National Assembly within a year.”
Choi, who is a former professor in the Department of Business Administration at Sogang University, has served as chairperson of the KOSDAQ Committee, president of the Korean Securities Association, and a member of the Financial Monetary Commission at the Bank of Korea. He passed the accounting examination in 1971. Choi was elected as the 47th president of the KICPA on June 19, 2024.
Reflecting on the core implementation results over the past year since taking office, Choi cited the installation of a corporate grievance reporting system, periodic exemption waivers to leave it open-ended, acceleration of the promotion of the accounting basic law, town hall meetings for young certified public accountants, the establishment of a new section called ‘I hope for the president,’ and discussions on sustainability disclosures.
Choi stated, “The accounting standards for small businesses, public institutions, and public corporations differ due to various legal bases and competent ministries, making it difficult to establish a consistent and systematic audit policy.” He also mentioned, “Since accounting basic law is part of President Lee Jae-myung’s campaign pledge, I hope it will gain momentum for enactment. It is a matter of establishing a law, not just amending, so it will take 2 to 3 years to push forward.”
The accounting basic law, which oversees corporate accounting and nonprofit accounting, aims to define all processes from accounting standards and external audits to disclosures and supervision. The Korea Certified Public Accountant Society plans to analyze the basic law structure through seminars in June and July, and to refine the legal draft through secondary research.
Choi also presented securing the effectiveness of the audit committee's role and enhancing the quality level of registered accounting firms as issues to pursue during the remaining year of his term. He mentioned that a committee would be operated for cooperation among various scales and generations in the accounting industry, and that a political academy would be established to assist accountants in entering politics in September. Additionally, a new local certified public accountant association will be formed in Gangwon and Jeju.
Choi addressed the situation regarding the ‘Big Four’ accounting firms, including Samil, Samjung, Anjin, and HanYoung, engaging in a price-cutting competition amidst the industry recession by stating, “This is not just a problem of mandatory designation of auditors, but rather an issue with the accounting firms. Excessive dumping of audit costs leads to a decline in audit quality, so figuring out how to resolve this is our biggest challenge,” and added, “We must start with the Big Four. The audit committee also needs to take responsibility and play a central role in preventing dumping.”