Syntekabio Moves to Launch 'Management Innovation Committee'... Strengthens Fund Controls, Ramps Up Management Overhaul

Syntekabio is launching a management overhaul to improve management transparency and strengthen internal controls following a disclaimer of opinion on its interim review. The company plans to strengthen oversight of major fund disbursements, service contracts, and investment decisions, while also preparing for a re-audit to accelerate efforts to restore market confidence.

Syntekabio, a company specializing in artificial intelligence (AI)-based drug development, said on October 21 that its board of directors had voted to establish a Management Innovation Committee. All newly appointed directors and the auditor, who were elected at the extraordinary general meeting of shareholders on October 16, attended the board meeting. Inside director Park Seok-geun was appointed the committee's inaugural chair.

The Management Innovation Committee is part of the follow-up measures addressing accounting-related issues raised in the interim review report issued in August. At the time, Syntekabio received a disclaimer of opinion because it had failed to obtain sufficient audit evidence to verify, among other things, the legitimacy of loan transactions and the purposes for which the funds were used.

Since then, the company has taken key financial follow-up measures, including recovering loans from relevant executives, and has organized its accounting and financial records and supporting documentation. With the launch of the committee, the company plans to go beyond resolving individual issues and strengthen internal controls across major fund disbursements and management decision-making.

The Management Innovation Committee will review and oversee key management matters, including major fund disbursements, service contracts, and investments. The company plans to use this process to prevent unnecessary spending and inefficient fund management, while also strengthening internal checks on management.

Syntekabio is also stepping up preparations for a re-audit. It is continuing follow-up measures related to the interim review opinion, including supplementing relevant records and supporting documentation with advice from external accounting and financial experts and discussing the necessary procedures with the audit firm.

The company plans to pursue the re-audit and management reforms in parallel to improve accounting transparency and financial soundness, while establishing a management foundation that will allow it to steadily advance AI-based drug development and new businesses.

A Syntekabio representative said, "We have taken key follow-up measures, including recovering loans, in response to the issues raised during the interim review." The representative added, "We are now focusing on improving the management system itself to prevent similar issues from recurring, rather than simply resolving individual problems."

The representative continued, "Through the Management Innovation Committee, we plan to strengthen internal controls over major fund disbursements and management decision-making, while pursuing a re-audit and overhauling our management structure in parallel." The representative emphasized, "We will use this reform as an opportunity to strengthen management transparency and accountability, and focus our efforts on restoring market confidence and enhancing corporate value."

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