Part 6 · Reading disclosures beyond the numbers · Lesson 33
Preliminary results and correction disclosures
Read the numbers that come out before the annual report, and corrected filings that fix disclosures already submitted.
QToday's question
Earnings news came out in early April, so why does the quarterly report only come out in mid-May?
Once the books are closed, a company first announces the numbers briefly and later files the formal report that has gone through the auditor's review. In this lesson you learn what to look at when the numbers released first differ from those released later, and when a company fixes a disclosure it filed.
MAPLearning map for this lesson
We build it up in three steps. At the end of each step, a 'Quick check' lets you test your understanding before moving on.
In Lesson 4 you saw that quarterly reports are due within 45 days after quarter-end and annual reports within 90 days. In Lesson 17 you learned how to compare preliminary earnings with consensus, and in Lesson 2 that a corrected filing is a disclosure that fixes one already filed. For why the market reacts to "the gap versus expectations," see Learn (Economics) Lesson 20 as well.
- STEP 1 · Basic conceptsThe numbers that come first: preliminary earnings
Explain why come out before the periodic reports, and what means.
- STEP 2 · Understanding the mechanismPreliminary vs. final figures, and corrections
Explain why preliminary and final figures can differ, and what to suspect when keep repeating.
- STEP 3 · Applying itFollowing a year along the disclosure timeline
Read the flow of disclosures in order, from preliminary earnings to the annual report, and find where the numbers changed.
STEP 1The numbers that come first: preliminary earnings
It is like a teacher calling out test scores first, with the official report card arriving a few days later. The score called out first is the preliminary result.
Why announce the numbers early?
As we saw in Lesson 4, quarterly reports are due within 45 days after the quarter ends and annual reports within 90 days. Inside the company, however, the books close much sooner. If a company wants to explain its results to analysts or institutional investors first, it must first release the same information to all investors. This is .
So within a few weeks after a quarter ends, many listed companies first disclose revenue, operating profit, income from continuing operations before income taxes, and net income under titles such as "Consolidated Operating (Preliminary) Results (Fair Disclosure)." These are . This is also the filing behind news like "Q3 operating profit of KRW ○ trillion," which a large manufacturer puts out a little over a week after the quarter ends.
What preliminary earnings contain
A preliminary earnings filing usually shows the current quarter, the prior period (previous quarter), the same quarter a year earlier, and the rates of change. As you learned in Lesson 17, look at the year-over-year (YoY) change first, then compare with market expectations () to judge whether it is an or a shock. For Robin Bakery (fictional), for example, if Q4 preliminary operating profit comes in at KRW 550 million, you read it as up about 28% from KRW 430 million in the prior-year Q4.
Once a year, if it changes by 30% or more
Another filing comes once the annual accounts are done. If any one of revenue, operating profit or loss, or net profit or loss for the latest fiscal year rises or falls by 30% or more from the prior fiscal year (15% or more for large corporations with total assets of KRW 2 trillion or more), the company must file a disclosure. It comes out once the internal accounts are finalized, before the audit report is received, so it shows the annual numbers earlier than the March annual report (per Korea Exchange guidance on year-end results disclosure).
Robin Bakery's operating profit rose 25%, from KRW 1.2 billion in Year 2 to KRW 1.5 billion in Year 3, which is below the 30% threshold for a regular company, so it has no obligation to file this. Net income, however, rose about 33%, from KRW 900 million to KRW 1.2 billion, so it is covered. As you can see, exceeding the threshold on just one of the three figures triggers the filing.
Quick checkA company with total assets of KRW 3 trillion saw operating profit go from KRW 100 billion to KRW 118 billion. Is it subject to the earnings-structure change disclosure?
STEP 2Preliminary vs final figures, and corrections
The score called out first may differ slightly from the report card. A small difference is fine, but if it is large or keeps being corrected, you should ask why.
Why do preliminary and final figures differ?
Preliminary earnings are numbers the company tallied itself, while final figures have gone through an accountant's review (quarterly, semi-annual) or audit (annual). In between, judgment items such as inventory valuation, provisions and foreign currency translation may be adjusted, so the numbers change a little. In the real example from Lesson 17, a large manufacturer's Q3 2024 operating profit was about KRW 9.1 trillion in the preliminary results and KRW 9.18 trillion in the final figure in the quarterly report. The difference is just over 1%.
Preliminary vs final figures: compare the size of the gap
The real case uses the numbers confirmed in Lesson 17 (the preliminary KRW 9.1 trillion comes from news coverage of the preliminary results; the final KRW 9.18 trillion is based on the prior-year column of the DART quarterly report (rcpNo 20251114002447)). Robin Bakery and Dark Cloud Electronics use fictional numbers for teaching purposes.
Corrected filings: fixing a filing already made
If [Correction] appears in front of a filing title, it is a fix to a filing already made. When you open a corrected filing, the reason for the correction and a before and after table appear at the very top. Some corrections are simple clerical ones, such as typos or date fixes, while others change investment decisions, such as contract amounts, capital-raise schedules or earnings figures. That is why, with corrected filings, what changed matters more than the title.
The problem is when the same filing is corrected multiple times, or when a contract, investment or capital raise that was already announced is withdrawn. The exchange designates a company as an and assigns penalty points if it files late (failure to disclose), reverses what it already filed (reversal of disclosure), or significantly changes important content (change of disclosure).
Source: Korea Capital Market Institute, "Status and Implications of Unfaithful Disclosure Designations Among Listed Companies in Korea" (2026-06-01). Failed investment attraction, terminated supply contracts and withdrawn convertible bond issues were cited as background for the 2024 increase.
Common misconceptions
- "If [Correction] is attached, the company definitely has a problem?"
- Many corrections simply fix a plain error. Annual reports are also often corrected to supplement attachments. Judge by looking at which items changed in the before and after table.
- "If preliminary earnings are good, will the final figures be just as good?"
- Most are similar, but companies with many judgment items can see larger gaps. Check the final figures once more together with the audit opinion (Lesson 30).
- "Does every company always disclose preliminary earnings?"
- Quarterly preliminary earnings are often filed when a company wants to announce first, so some companies do not file them. By contrast, a 30% (15% for large corporations) or more change in the annual earnings structure is a mandatory disclosure.
Quick checkA company filed a "Single Sales / Supply Contract" disclosure, then three months later cut the contract amount in half through a [Correction]. What should you suspect?
STEP 3Following a year on the disclosure timeline
If you lay out one company's disclosures for a year in time order, you can see at a glance when the numbers first come out, when they are finalized, and when they are corrected.
Disclosure timeline · Robin Bakery Year 3 closing (fictional) Click a stage to see what comes out and what changes at that point.
Dates and numbers are examples based on a fictional company with a December fiscal year-end. Actual companies may have different disclosure dates.
Find it yourself on DART
As in Lesson 3, search for a company and choose Exchange disclosure in the filing type to see "Operating (Preliminary) Results (Fair Disclosure)" and "Change of 30% (15% for Large Corporations) or More in Revenue or Profit Structure" filings. In the search results list, count the filings with [Correction] in front of the title, and open one to check the before and after table at the top. Whether a company has been designated an unfaithful disclosure corporation appears under the title "Designation of Unfaithful Disclosure Corporation" in the exchange disclosures ().
How to use it in investing
| What the filing shows | How to read it |
|---|---|
| Preliminary earnings far better than consensus | Check whether one-off gains (Lesson 15) are mixed in and whether they hold up in the final figures |
| The gap between preliminary and final figures is more than 5% | Find in the notes whether the changed item is revenue or a cost judgment (provisions, inventory valuation) |
| Disclosure of a 30% or more change in earnings structure | Read the reason-for-change box and compare with the final numbers in the March annual report |
| The same filing corrected 2–3 or more times | Check what changed in the before and after table, and record it in the Lesson 34 red flag checklist |
| Designation as an unfaithful disclosure corporation | The reason for designation (failure, reversal, change), penalty points, and past designation history |
This is not always the case. Preliminary earnings and corrected filings only show "when and how reliably" a company's numbers come out. Judge the quality of the numbers together using the financial statements (Parts 3–4) and the audit opinion (Lesson 30). This is educational material and does not recommend buying or selling any particular stock.
Quick checkA company disclosed preliminary operating profit of KRW 5 billion in February, then reported final operating profit of KRW 3.8 billion in the March annual report. What is the difference in percent, and what should you look at first?
✓What we learned today
- Preliminary earnings are a fair disclosure that announces revenue, operating profit and so on after closing the books but before the audit or review is complete. The intent is not to tell only certain people first, but to inform everyone at the same time.
- Preliminary figures are finalized later in the quarterly or annual report and may change slightly. A large manufacturer's Q3 2024 operating profit was KRW 9.1 trillion preliminary and KRW 9.18 trillion final (Lesson 17).
- If annual revenue or profit changes by 30% (15% or more for large corporations with total assets of KRW 2 trillion or more) from the prior year, a "Change of 30% (15% for Large Corporations) or More in Revenue or Profit Structure" disclosure is filed.
- Corrected filings range from numerical typos to changes in important content. Look at what changed (before and after) and how many times it has been corrected.
- If a company files late, or reverses or changes a disclosure, the exchange designates it an unfaithful disclosure corporation. Designations in 2024 numbered 147, a record, and about 70% were KOSDAQ companies.
You can now read disclosures beyond the numbers, in Part 6. From the next lesson, Part 7 is hands-on practice. Let's gather the red flags you've learned so far into a 10-item checklist and review them yourself.
Quiz5-question quiz
Pick an answer and it's graded right away with an explanation.
Q1. Which statement about a preliminary earnings disclosure is correct?
Preliminary earnings announce pre-audit, pre-review numbers first through fair disclosure. Final figures come out in the quarterly or annual report.
Q2. A regular company with total assets of KRW 1 trillion saw net income go from KRW 10 billion to KRW 12.5 billion. Is it subject to the earnings-structure change disclosure?
It rose 25%. For a regular company with assets under KRW 2 trillion, the threshold is 30%, so it is not subject to mandatory disclosure. If it were a large corporation, it would be covered under the 15% threshold.
Q3. When you open a corrected filing, where should you look first?
What changed and how is the key. Distinguish a typo fix from content that changes judgment, such as amounts and schedules.
Q4. Which of these is NOT a case where the exchange designates an unfaithful disclosure corporation?
Earnings beating expectations has nothing to do with unfaithful disclosure. Failure to disclose, reversal and change of disclosure are the grounds for designation.
Q5. Robin Bakery's (fictional) Q4 preliminary operating profit is KRW 550 million, versus KRW 430 million in the prior-year Q4. What is the year-over-year growth rate?
(5.5 − 4.3) ÷ 4.3 ≈ 28%. For a company with seasonality, compare with the same quarter a year earlier rather than the previous quarter, as in Lesson 17.
NextTerms · Next lesson · Related tools
Right after closing the books, the company announces provisional revenue, operating profit and net income first through an exchange disclosure. These are pre-audit numbers, so they may change in the periodic report.
Fair disclosureFair disclosureA system that requires a company to disclose important information, such as earnings guidance or preliminary results, to the exchange for all investors at the same time before giving it first to particular parties such as analysts or institutions.
Corrected filingCorrected filingA filing that corrects and resubmits content already filed. You can recognize it on the DART list by a correction marker or a prefix such as [Correction of Entries], and you should check the reason for the correction and the before-and-after comparison.
30% (15% for large corporations) or more change in revenue or earnings structure30% change in revenue or earningsAn exchange timely disclosure filed when any one of revenue, operating profit or loss, or net profit or loss for the latest fiscal year changes by 30% or more from the prior year (15% for large corporations with total assets of KRW 2 trillion or more). It comes out before the annual report, once internal accounts are finalized.
Unfaithful disclosure corporationUnfaithful disclosure corporationA designation by the exchange for a listed company that fails to disclose by the deadline (failure to disclose), reverses what it already disclosed (reversal of disclosure), or significantly changes important content (change of disclosure). Penalty points and fines follow. Designations in 2024 numbered 147, a record high.
Quarterly reportQuarterly reportA periodic report filed within 45 days covering the first 3 months of the fiscal year (Q1) and the first 9 months (Q3 cumulative). There is no separate report covering only Q4.
Annual reportAnnual report (business report)A statutory report covering one year that listed companies and others file within 90 days after the fiscal year ends. It contains audited financial statements, the business description, and shareholder and officer information in 12 chapters.
ReviewReviewA lighter verification procedure than an audit, mainly using inquiry and analysis to give limited assurance that "no material errors were found." Semi-annual financial statements and similar receive it.
Audit (external audit)AuditA procedure in which an outside accounting firm checks the books and supporting evidence and gives an opinion (unqualified, qualified, adverse or disclaimer) on whether the financial statements were prepared in accordance with accounting standards. The annual financial statements undergo it.
ConsensusConsensusThe average forecast of market experts for an economic indicator or company earnings. The gap between the actual release and this figure moves the market.
Earnings surpriseEarnings surpriseWhen company earnings come in well above the analyst forecast (consensus). When they come in well below, it is called an earnings shock.
KINDKorea Investor's Network for DisclosureThe listing disclosure system operated by Korea Exchange. Timely exchange disclosures such as supply contracts and preliminary earnings are posted there, and they can also be seen on DART under the exchange disclosure type.
Material event reportMaterial event reportA report filed when something that greatly affects the company's management or assets happens, such as a paid-in capital increase, convertible bond issuance, treasury stock acquisition, a significant asset transfer, or a merger. It is filed by the day after the event occurs (within 3 days for mergers and the like).
Put what you learned to use right away
Earnings calendar→This is educational material and not investment solicitation. There is no guarantee that past relationships will repeat in the future.