The Financial Services Commission (FSC) has vowed to conduct more through audits on industries, such as shipbuilding and construction, which deal with large-scale contracts.
 
The financial watchdog announced a set of measures on Wednesday to prevent companies from concealing their operating losses and reflecting them all at once, resulting in a so-called fiscal cliff, as in the recent cases of Daewoo Shipbuilding and Marine Engineering (DSME) and Hyundai Engineering.
 
Starting from this month, state auditors will focus on areas that require the most attention and highlight the results of the audit in reports submitted to the FSC.
 
Companies will also be required to regularly and publicly disclose the progress of their projects as well as any money owed which could eventually affect a project’s profits.
 
The FSC has also revised the accounting standards so that any changes in a contract will be immediately reflected on the expected earnings.
 
The FSC said it will also create a task force in charge of overseeing the companies' accounting practices, and will increase rewards for internal whistle-blowers who report illicit accounting procedures.