Scandal-hit Deloitte Anjin loses over 50 key clients
[THE INVESTOR] Deloitte Anjin, one of the nation’s top four accounting firms, has reportedly lost more than 50 key corporate clients after it was hit with a 12-month business suspension early this month for its role in the accounting fraud of Daewoo Shipbuilding & Marine Engineering, the Seoul Economic Daily reported on April 19.
Citing unnamed sources, the report said, at least 50 companies such as Hyundai Card, Samsung Card and Samsung BioLogics have replaced their auditor since the penalty for Anjin was announced on April 5.
Anjin was the No. 3 accounting firm with an 11.6 percent market share last year. It had handled audits for a total of 1,068 companies, including 121 KOSPI-listed firms.
Most of its big clients have replaced their auditor with Anjin’s rivals -- Samil PwC, Samgjong KPMG and Ernst & Young Hanyoung. The four accounting firms have dominated more than 50 percent of the market here.
Hyundai Motor, one of the biggest clients, however, is said to have decided to maintain its business with Anjin, while its smaller affiliate Kia Motors has switched to Hanyoung.
Sources say Anjin is expected to suffer financial damages worth more than 30 billion won (US$26.2 million) following the business suspension. Its annual audit revenue is estimated at about 105 billion won on average.
The report said the New York headquarters of Deloitte has decided to fund about 22 billion won for the cash-strapped Korean unit.
By Song Seung-hyun (firstname.lastname@example.org)