Defendant 2 and Defendant 3 are not guilty.

Defendant 1’s appeal is dismissed.

Defendant 1 is the representative director of Nonindicted Co. 2 (hereinafter “Nonindicted Co. 2”) and Defendant 2 is the assistant director and head of Nonindicted Co. 2, and Defendant 3 is the regular director of Nonindicted Co. 2.

A person who is not a certified public appraiser shall determine the economic value of land, etc. and indicate the result at the price, and shall not receive a certain remuneration.

On October 30, 2009, the Defendants conspired to conduct an asset revaluation on the site (hereinafter “instant land”) of Nonindicted Company 2’s office located in Gangnam-gu Seoul on October 30, 2009, from Nonindicted Company 1 (hereinafter “Nonindicted Company 1”), Nonindicted Company 1 (hereinafter “Nonindicted Company 1”), including the site for the building of Nonindicted Company 1’s Seocho-gu Seocho-gu, Seocho-gu, Seoul, for water supply, interest, and sugar, and the distribution center at the former place of business, etc. of Nonindicted Company 1 (hereinafter “instant land”). As a result, the Defendants conducted a asset revaluation and conducted the asset revaluation, indicate the economic value of the land subject to appraisal (the value of the existing book value of KRW 3,398,849,587,432) as KRW 7,215,142,128,981, and received KRW 154 million in return.

As a result, even if the Defendants were not a certified public appraiser in collusion, the Defendants determined the economic value of the land and received remuneration by indicating the result at the price.

2. Summary of grounds for appeal;

A. Whether the elements of establishment are satisfied

The Defendants merely assessed the fair value of Nonindicted Company 1’s instant land according to the introduction of the Korean International Financial Reporting Standards (K-IFRS). As such, this does not constitute an appraisal business under Article 43 of the Act on Public Notice of Values and Appraisal of Real Estate (hereinafter “Additional Act”).

B. Illegality

Since Defendants’ act is “an appraisal of accounting,” which is the duty of certified public accountant as prescribed by the Certified Public Accountant Act, illegality is excluded as an act under the law.

(c) Responsibility;

Defendants’ act is an error in law and cannot be punished.

D. Unreasonable sentencing

Each sentence of the lower court against the Defendants is too unreasonable.

3. Determination

A. Whether the elements of establishment are satisfied

In the lower court’s identical assertion, the Defendants explained in detail the Defendants’ assertion and its determination, and rejected the Defendants’ assertion on the ground that the appraisal and assessment of land, etc. for the purpose of accounting falls under Article 43 subparag. 2 of the Addenda, even though it is an appraisal and assessment of land, etc. for the purpose of accounting. Examining the judgment of the lower court in a thorough comparison with the records, the lower court’s determination is just and acceptable, and there is no error of law by misapprehending the legal doctrine on the interpretation of Article 43 subparag. 2 of the Addenda, which affected the conclusion of the judgment. Therefore, the Defendants’ assertion is without merit.

B. Illegality

(1) Relevant statutes

Article 2 Subparag. 1 of the Certified Public Accountant Act explicitly states "appraisal on accounting" as the duties of certified public accountant. Article 21(2)4 provides that "No certified public accountant shall carry out a business prescribed by Presidential Decree as being in conflict of interest with the company concerned during the period in which he enters into a contract to audit or certify a specific company's financial statements." Article 14(2) of the Enforcement Decree of the same Act provides that "the business prescribed by Presidential Decree as mentioned above refers to the actual inspection, financial reporting, value assessment, etc. of the assets, etc. of a particular company to sell all or part of the assets, capital, and other rights of a particular company."

(2) Facts of recognition

The record reveals the following facts.

① The Act on External Audit of Stock Companies, amended by Act No. 9408, Feb. 3, 2009, required to adopt and apply international accounting standards to stock companies larger than a certain size. One of the features of the Korean International Financial Reporting Standards is to assess all assets and liabilities as fair value, and fair value valuation is not a price appraised at the time of acquisition of assets and liabilities, but a market value at the time of evaluation.

② Around July 2009, Nonindicted Co. 1 requested Nonindicted Co. 2 to assess the fair value of the instant land in order to apply the standards for international accounting for adoption of Korea.

③ Around October 30, 2009, Nonindicted Co. 2 issued a review report with respect to the instant land to Nonindicted Co. 1, 2009, stating that “This report is calculated for the purpose of calculating the fair value of the land owned by the company as of January 1, 2009 (the date of conversion) following the introduction of the Korea-adopted International Accounting Standards, so it shall not be used for any other purpose, and it shall not be provided or quoted without prior approval to persons other than interested parties, such as company management and auditor, and Nonindicted Co. 1 published the results of the review report through the electronic publication system of the Financial Supervisory Service.

④ After the instant case, the accounting corporation asked the Financial Services Commission as to whether certified public accountants or accounting corporations are able to assess the company’s assets, liabilities, capital, other rights, etc. in accordance with the Korea-adopted International Accounting Standards under the Act on External Audit of Stock Companies, and the Financial Services Commission respondeded that “The 3-day accounting corporation may perform the valuation business for the company’s assets, liabilities, capital, other rights, etc. under the Korean International Financial Reporting Standards pursuant to Article 2 subparag. 1 and 3

⑤ Defendant 1 is not a certified public accountant, and Defendant 2 and Defendant 3 are certified public accountants.

(3) Determination

Unless there are special circumstances such as conflict of interest, a certified public accountant can appraise the accounts, and can assess the value of assets, etc., and the review report prepared by Nonindicted Company 2 in this case is for the fair value assessment of the land of this case according to the introduction of the Korea Approved Accounting Standards, and is for the fair value assessment of the land of this case as stipulated in Article 2 subparag. 1 of the Certified Public Accountant Act.

Therefore, since the acts of Defendant 2 and Defendant 3, who are certified public accountants, constitute acts under the law and Article 20 of the Criminal Act, and thus, are not illegal, this part of the argument by Defendant 2 and Defendant 3 is reasonable, and Defendant 1 is not a certified public accountant, and this part of the argument by Defendant 1 is without merit.

(c) Responsibility;

Defendant 1 asserted the same as above in the court below, and the court below rejected the above assertion on the ground that it is difficult to see that there is a legitimate reason" as provided in Article 16 of the Criminal Act, just because it committed the act in this case with the belief of the interpretation of the Korean Accounting Institute or the Korean Institute of Certified Public Accountants, which is not an authoritative agency, under the title of "the judgment on the assertion of Defendant 1, Defendant 2, Defendant 3 and defense counsel" (the aforementioned reply by the Financial Services Commission is an act after the act in this case, and cannot be deemed as the ground for legal mistake). The judgment of the court below is just and it is not erroneous in the misapprehension of legal principles as to the interpretation of legal errors under Article 16 of the Criminal Act, which affected the conclusion of the judgment (the above reply by the court below cannot be deemed as the ground for legal mistake).

D. Unreasonable sentencing

In full view of all the sentencing conditions shown in the records and arguments of this case, the lower court’s punishment against Defendant 1 is too unreasonable.

4. Conclusion

Therefore, since the appeal by Defendant 1 is without merit, it is dismissed in accordance with Article 364(4) of the Criminal Procedure Act, and since the appeal by Defendant 2 and Defendant 3 is with merit, the part of the judgment below against Defendant 2 and Defendant 3 among the judgment below pursuant to Article 364(6) of the Criminal Procedure Act is reversed and it is again decided as follows.

Judges Jeong-ho (Presiding Judge)