Korea

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70 Country starter pack Business practicalities in Korea A complete set of financial statements as required by law consists of the following: • A statement of financial position as at the end of the period • A statement of comprehensive income for the period • A statement of changes in equity for the period • A statement of cash flows for the period • A statement of appropriation of retained earnings • Notes, comprising a summary of significant accounting policies and other explanatory information. Audited financial statements According to the Act on External Audit of Stock Companies, a stock company that meets one of the following criteria is required to have its financial statements audited by an external auditor: • A stock company with total assets equal to or greater than KRW 12 billion at the end of the preceding fiscal year • A listed stock company and a stock company that intends to be listed in the relevant business year or the following business year • A stock company with total assets and total liabilities each equal to or greater than KRW 7 billion at the end of the preceding fiscal year • A stock company with total assets equal to or greater than KRW 7 billion and with 300 employees or more at the end of the preceding fiscal year. In addition to the aforementioned external audit requirements, listed companies should additionally submit an external auditor’s semi-annual review report, and listed companies with total assets equal to or greater than KRW 500 billion are obliged to disclose the external auditor’s review and its report on quarterly financial statements. Appointment of auditors Stock companies that meet the above-mentioned audit requirements should appoint an external auditor within four months from the commencement of each fiscal year, which requires approval from its internal auditor or auditor appointment committee. The appointment should be reported to shareholders at the annual general shareholders’ meeting, notified to shareholders in writing or by email, or posted on the company‘s website.
Country starter pack Business practicalities in Korea 71 OECD TOP 5 COUNTRIES COLLEGE GRADUATION RATE (age 25-34 in 2012) ENGINEERING COLLEGE GRADUATES (of every 100,000 people) Korea 65% Japan 60% Canada 57% Russia 56% Ireland 48% Korea 3,555 New Zealand 2,987 France 2,717 Finland 2,384 UK 2,380 Source: OECD 5.5 EMPLOYING WORKERS Labour market Korea’s labour force is generally regarded as highly literate, well-educated, motivated, and hard working. Currently, however, there are shortages of manual and factory workers in some industries. The shortage in labour-intensive roles is being met by foreign workers from countries such as Vietnam, the Philippines, Indonesia, Pakistan, Thailand, Mongolia, and Sri Lanka. In this context, a Foreign Workers Employment Act was introduced in July 2010, permitting Korean industries to employ foreigners from countries with which Korea maintains bilateral labour agreements. Being a nation of limited natural resources, Korea’s principal resource is its abundant supply of skilled labour. This has played a primary role in Korea becoming a world leader in industries such as shipbuilding (first in 2014), auto vehicle manufacturing (fifth in 2013), and steel making (sixth in 2013). As a nation, Korea is passionate about education. Enrolment rates at all levels of education are among the highest in the world. These factors, combined with the country’s high degree of technological adoption and relatively strong business sophistication, help explain its remarkable capacity for innovation. It boasts a literacy rate of around 98 per cent, its university entrance rate was 72.5 per cent (the highest among OECD member countries) and about 65 per cent of people aged between 25 and 34 were university graduates. Every year, approximately 470,000 university graduates join the labour market. Its commitment to excellence in education feeds a continuous supply of high-quality human resources for industry, which in turn enhances competitiveness and innovation in the Korean economy. Furthermore, 42.1 per cent of Koreans in the workforce are also studying at the same time as working to obtain higher skill levels or new qualifications. Koreans are diligent and faithful to their work. In 2012, their average annual working hours were 2,163 – the second highest among OECD countries. The labour productivity index has also steadily risen in recent years, with Korea recording one of the highest increases in labour productivity in the OECD between 2009 and 2013. Employers should also be aware that Korea has conscription - compulsory military service, for Korean men aged between 18 to 35 years. Most men will undertake their required military service generally in their late teens or early twenties. The length of conscription varies between 21-36 months. This means that someone of a certain company position may seem to be older than what they would be in the same position in Australia.
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REPUBLIC OF Korea COUNTRY STARTER P
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SURFACE AREA 99,400 square kmS GDP
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Page 19 and 20: Country starter pack Introduction t
Page 21 and 22: Country starter pack Getting starte
Page 39 and 40: Country starter pack Sales & market
Page 47 and 48: Country starter pack Conducting bus
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Page 83 and 84: Country starter pack Visiting Korea
Page 97 and 98: Country starter pack Engage with us
Page 99 and 100: Country starter pack Engage with us
Page 102: © August 2015, Asialink Business.
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Korea

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