Story of a Big Player from Gangnam

Chapter 679: Crowdfunding on Movie Production (2) - Part 2

Accountant Nak-Jong Lee continued, "I will take it as the two events—the capital increase and the company share transfer to Mr. Beom-Sik Lee—have nothing to do with the company's recent dramatic increase in sales. To be honest with you, it doesn't concern us anyway. I just asked you about it out of curiosity; that's all."

"Right. I can assure you that there is no connection between the two."

"And, you transferred 3% of the company share to Mr. Jang-Hwan Song. Well, it was probably an incentive for the co-president."

"That's correct."

"This is all for GH Mobile. Before we get into the external audit report on Dyeon Korea, can we take a short break? You look tired, sir."

"Sounds good. Let's take a 10-minute break."

After ten minutes, Gun-Ho and the CPA sat at the table in Gun-Ho's office again.

"Dyeon Korea generated 52.8 billion won last year. I don't have its previous year's sales revenue to compare with since it's a newly established company. I can tell you that it is indeed an outstanding achievement for a new company. I've worked as a CPA for 18 years, and I've never seen a company that made this much in its first year."

"Hmm, really?"

"I would say that it is because of the brand name—Dyeon—which is an internationally recognized name. Its sales profit and operating profit look reasonable and stable."

"Hmm."

"According to the internal auditor, the last year's profits after tax will be reinvested in the company to increase its capital, and two partners will invest 4.5 billion won each."

"That's correct."

"We—the CPAs—read a company's president's intention and will along with the direction where the company is heading, based on their balance sheet (B/S) and income statement (I/S)."

"What are you saying?"

"I've noticed that the expenses related to obtaining various certificates and to the research center have recently increased. Moreover, the training expenditure on Inno-Biz and recognition of a start-up company with technology has increased as well."

"It's a part of our effort to stabilize the company's product quality control system."

"Additionally, it seems that you are playing a capital increase game in order to raise the major shareholders' share in the company. The company's authorized capital is becoming the same as its paid-in capital."

"A company's capital is increased as more investment funds are infused, isn't it?"

"So, my guess is that you are planning to register Dyeon Korea with KOSDAQ before GH Mobile."

"I'm sure that every small or medium-size company wants to go public."

"Dyeon Korea has no debt, and it has enough cash in its reserve as more investment funds came from the shareholders. I think the company plans to do either one of these."

"Please go on. It's getting interesting."

"After going public, I think that it would open a factory in other countries such as China or India with the cash in the reserve, or…"

"Or?"

"I don't know about the terms of the joint venture contract, but if it allows a shareholder to transfer their shares, you might be thinking of selling your shares to a third person for a high price. You are running a business to make money after all. If you sell the shares after the company goes public at its market value, you will make a lot of money."

"Don't ever say that again. I have no intention to sell my Dyeon Korea's shares, and there is no buyer who is ready to purchase it either."

"Well, if you say so, sir, I will take it as you say."

"I won't answer any more questions that are beyond the scope of the audit."

"Haha, fair enough. I was just speculating, sir."

"Thank you for the external audit report. I will instruct the accounting staff to send the payment to your office as soon as possible."

"Thank you, sir."

Gun-Ho then called for the accounting director—Ms. Director Min-Hwa Kim.

She came to Gun-Ho's office after a moment.

"Did you want to see me, sir?"

"We have a guest here today—Mr. CPA Nak-Jong Lee—from Anchang CPA office. I would love to have lunch with him today, but I have pre-engagement. Will you have lunch with him?"

"With my pleasure, sir. I would love to."

Accountant Nak-Jong Lee laughed as he stood up from his seat.

"Well, it was a pleasure talking with you today, sir."

Gun-Ho stood up from his seat and extended his hand to Accountant Nak-Jong Lee for a handshake. After the accountant left the office, Gun-Ho mumbled to himself.

"He is certainly knowledgeable. As he claimed, I don't doubt that he has been in the field for 18 years."

Gun-Ho received a call from Dyeon Korea's internal auditor.

"Did the CPA from Anchang CPA office come to GH Mobile, sir?"

"Yes, he just left my office."

"There was nothing unusual about his visit or report, wasn't it?"

"No, it was all fine."

"You are coming to Dyeon Korea today, right, sir?"

"Yes. I will be there after lunch."

"We've received the certificate for our in-house research center. We will have a simple signboard-hanging ceremony with the certificate. We just want to take a picture of it."

"Okay."

Gun-Ho could have had lunch with the CPA that day, but he intentionally avoided it. Gun-Ho didn't want the CPA to know too much information about his companies. The more time he spent with the CPA, the more chance that Gun-Ho would blurt out unnecessary things. It wouldn't actually matter whether the CPA found out things about his companies, but Gun-Ho didn't want to expose what he had in his mind to him. That was why he asked the accounting director to have lunch with the CPA for him.

'CPAs do have a responsibility to not disclose confidential information about their clients that were learned during their professional service. If they do, they could lose their job because it's very easy for a company to change their CPAs to someone else.

By the way, do I have to attend that signboard-hanging ceremony to take a picture? I think I'd better step back from the front-line president work and take a chairman position instead. As the president, I have to attend so many events and handle stuff that I'm not fond of doing. I will let someone else do the job, and I want to focus on the money and its flow. I will keep the president position until Dyeon Korea successfully goes public.'

Gun-Ho went to a restaurant that was located close to the hot spring resort in Eumbong Town to have lunch with Chan-Ho Eom. They had Bibimbap*. They headed to Dyeon Korea after their afternoon coffee.

When Gun-Ho arrived at his office, the secretary—Ms. Seon-Hye Yee—brought a cup of jujube tea to Gun-Ho's office.

"We still have the jujube tea left? I feel like we are never out of jujube tea in this office."

"My mom actually harvests the fruits herself, and dries them, and makes the tea with them. So, I can bring the tea to the office as much as I want."

"Hmm, is that so? Please send my thanks to your mother for me."

After a moment, the internal auditor came to Gun-Ho's office to take him to the signboard-signing ceremony. When he walked down to the building entrance, everyone was there already including Vice President Adam Castler, the chief research officer, and Manager Yoo. On the column at the entrance, there was a signboard indicating the in-house research center. They posed for a photo by pretending that they were hanging the signboard just now.

"We now have the environment management system certificate—ISO 14001—and our in-house research center is officially confirmed. We are almost ready to apply for the Inno-Biz certificate and for the recognition as a start-up company with technology. Our applications for those two will be easily approved. I will get the work done by next month, sir."

Gun-Ho nodded his head twice while tying his hands together behind his back.

Note*

Bibimbap - Cooked rice with various vegetables and meat mixed together with Korean red chili paste.