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Audit Committee

Audit Committee Status

(Chairman:Hi-taek Shin/ Total no. of committee members: 2)

Audit Committee Status
Audit Type Position (Part/Full-time status) Name Date of appointment Tenure Responsibility Status of insured
Internal Director - -
Outside Director Director (Part-time) Hi-taek Shin 2012-03-30 3 years - Insured
Director (Part-time) Chang-hwan Kim 2013-03-29 3 years - Insured

Audit Committee Operation Status

Audit Committee Operation Status (2014)
no Date of Meeting Agenda Approval status
1 2014-02-11 Report by outside auditor on the financial audit outcome -
2 2014-03-04 Report on the operational status of internal accounting management systems -
Approval of audit report by auditor and auditor’s opinion on the internal monitoring system Approved
3 2014-03-28 Approval of elected outside auditor Approved
Outside auditor contract with tax adjustment agent -
4 2014-04-25 Report on key details of review of accounting by outside auditor -
5 2014-05-29 Report by outside auditor on the contract for “Due diligence of financial and tax-related status for the acquisition of a US-based target company for promoting a new business” -
6 2014-07-08 Report by outside auditor on the contract for “Performance of Various Services for Promoting New Business” -
7 2014-07-28 Report on key details of review of accounting by outside auditor -
8 2014-10-30 Report on key details of review of accounting by outside auditor -

Audit Committee Member Selection Process

1.Search Firm

Develop a pool of candidates for membership of the Audit Committee

2. Outside director candidate recommendation consultation committee

Recommendation of candidates (twice the final number)

3. Outside director candidate recommendation committee

Select outside candidates for director to be appointed as member of the Audit Committee

4. Board of Directors

Make decision on items recommended by members of the Audit Committee

5. General

Make the final selection of Audit Committee members after decision by the General Shareholders’ Meeting

Outside Auditor

Outside Auditor
Name of company Date of appointment Contract period Recent audit opinion
Anjin Accounting 2014-03-28 3 years unqualified opinion Proper

Composition of the Audit Committee and its Responsibilities

1. Composition of the Audit Committee
  1. 1.1 The Company shall install an Audit Committee in lieu of an Auditor.
  2. 1.2 The Audit Committee shall consist of 3 Directors.
  3. 1.3 Two thirds or more of the Committee members should be Outside Directors. Members who are not Outside Directors shall meet the requirements specified in Paragraph 3, Article 54-6 of the Securities Transaction Act.
  4. 1.4 The Audit Committee shall select a representative of the Committee.In this case, a number of members may jointly represent the Committee.
2. Responsibilities of the Audit Committee
  1. 2.1 Items on the General Shareholders’ Meeting
    • Request for convocation of an Extraordinary Shareholders’ Meeting.
    • Statement on the documentation and agenda of the General Shareholders’ Meeting.
  2. 2.2 Directors and Board of Directors
    • Duty of reporting to the Board of Directors.
    • Development and submission of the Audit Report.
    • Damage request regarding any illegal act on the part of the Director.
    • Request for a business report to the Director.
    • Items entrusted by the Board of Directors
  3. 2.3 Items for Audit
    • Investigation into business and properties.
    • Investigation of subsidiaries.
    • Receiving the Director’s report.
    • Representative of the Directors and the Company at the time of a dispute.
    • Determination on filing a lawsuit when a lawsuit against the Director is requested by minor shareholders.
    • Request for the appointment of an Outside Auditor
    • Receiving information on irregularities in the execution of the Director’s duties or a report that contains facts in material breach of the law or the Rules of Incorporation from an Outside Auditor
    • Receiving a report on facts pertaining to the Company in breach of the accounting principles from an Outside Auditor.
    • Evaluation of the internal control system.
    • Items that require a decision by the Audit Committee as stipulated in the law or the Rules of Incorporation, or items that are deemed necessary by another Audit Committee.

Status of the Audit Committee Support Department

  1. Board Directors
    1. Legal Department
    2. Audit Committee
      1. Audit Team, Administration center
      2. Account Team, Administration center
Audit Committee