SSC Suspends PwC Auditors Over NKG's 2025 Financial Statement Errors

Overview

The State Securities Commission (SSC) has suspended the audit qualification of PwC Vietnam auditors due to material accounting errors in Nam Kim Steel’s (NKG) 2025 audited financial statements. The errors involve a VND 94 billion discrepancy related to land use rights transfers. NKG stated it will cooperate with auditors to rectify the issues, which it says do not affect current business operations.

Key Facts

• The SSC suspended the audit qualification of PwC Vietnam auditors for NKG’s 2025 financial statements.
• The material error involves a VND 94 billion difference between the transfer price (VND 366 billion) and the original cost (VND 272 billion) of land use rights at the My Xuan B1 - Dai Duong Industrial Park.
• The error led to overstatements of prepaid expenses by VND 66 billion and other income by VND 94 billion on the consolidated balance sheet as of December 31, 2025.
• NKG’s consolidated financial statements failed to adjust for the land use rights value increase, resulting in misstatements of VND 66 billion, VND 28 billion, and VND 94 billion in various accounts.
• The SSC has required NKG to correct these errors in future financial statements.
• NKG shares closed at VND 12,200 on June 20, 2026, down 2.01% on volume of 2,008,800 shares.
• Previously, the SSC also suspended auditors from EY Vietnam and KPMG, both also Big 4 firms.

What Happened

Nam Kim Steel (NKG) received a notice from the State Securities Commission regarding quality issues in its 2025 audited financial statements. The SSC found that PwC Vietnam’s audit work for NKG’s separate and consolidated financial statements did not meet requirements. Specifically, auditors failed to perform adequate procedures for the separate statements and issued an unqualified opinion on consolidated statements that contained material accounting errors.

The key error involved a VND 94 billion discrepancy from the transfer of land use rights between NKG and its subsidiary Ton Nam Kim Phu My. The consolidated statements did not adjust for the difference between the transfer price (VND 366 billion) and the original cost (VND 272 billion), leading to overstatements of prepaid expenses and other income. The SSC has ordered NKG to rectify these errors in subsequent reporting periods.

Market Context

NKG shares closed at VND 12,200 on June 20, 2026, down 2.01% on moderate volume. The stock trades on HOSE and is part of the steel sector, which has faced headwinds from global oversupply and weak demand. The regulatory action adds to investor concerns about corporate governance and financial reporting quality, though NKG has downplayed the operational impact.

Strategic Significance

The suspension of a Big 4 auditor like PwC for a listed company underscores the SSC’s increasing scrutiny of audit quality and financial reporting. For NKG, the incident may raise questions about internal controls and accounting practices, potentially affecting investor confidence. However, the company’s assertion that operations are unaffected suggests the issue is limited to financial presentation. Long-term, NKG’s ability to maintain transparent reporting will be key to restoring trust.

What to Watch

• NKG’s next quarterly financial statements for evidence of corrected accounting treatment.
• Any further regulatory actions or fines from the SSC.
• NKG’s stock price reaction and trading volume in the coming weeks.
• Potential changes in NKG’s auditor or audit committee composition.
• Broader SSC enforcement actions against other companies with Big 4 auditors.