KBS Records 418.1 Billion Won Surplus

It was revealed that the earned surplus of Korea Broadcasting System (KBS), Korea’s public service broadcasting station, accumulated up to last year amounts to 481.14 billion won.

The Ministry of Finance and Economy (MOFE) and the National Assembly have been requesting KBS to pay the earned surplus to the National Treasury, which KBS has never accepted. This fact was confirmed in the “Report on the Status of Broadcasting Industry, 2006” handed in by the Korean Broadcasting Commission on October 18 to assemblyman Park Hyeong-joon of the Grand National Party, a member of the Culture and Tourism Committee of the National Assembly.

“The accumulated earned surplus was extracted from the financial statement of KBS last year and it is not clear for how many years the amount has been accumulated,” says an official at the Korean Broadcasting Commission.

According to the document for parliamentary audit submitted to assemblyman Chang Yoon-seok of the same party by KBS, the public broadcaster has been achieving above 35.2 billion won of net profits each year since 1981 up to last year, except for the years 1981, 1988, 1998, and 2004, which add up to more than 740 billion won.

KBS, a 100% government-invested organization, has never paid the earned surplus to the government since its establishment in 1973. Out of the 31 government-invested organizations, only KBS and Education Broadcasting Station (EBS) do not participate in the profit dividend program.

The National Assembly and the MOFE demanded the government dividend of the earned surplus saying that “KBS should return its earned surplus to the people of the nation in the form of dividend and such since it was established with taxpayer’s money.”

But KBS turned down the demand, saying, “KBS is not under the influence of the Framework Act on the Management of Government-Invested Institutions and it damages the independency of a broadcaster guaranteed by the Broadcasting Act.”

In the written opinion KBS handed in to the Korean Broadcasting Commission in September re-requesting government subsidies from the National Treasury in 2007, it said, “In order for KBS to provide the government with the dividend of the earned surplus, we need to revise its statute, which requires approval of the board of directors. The executive members are unable to decide this independently.”

mindy@donga.com