A former executive at ailing South Korean shipyard Daewoo Shipbuilding and Marine Engineering has been indicted for inflating earnings. This is according to a stock exchange release from the company Friday, reports Bloomberg.

The South Korean prosecutors accuse the executive, who left his post in March last year, of falsifying the company's accounts over a three-year period.

The executive allegedly downplayed costs on offshore projects under construction, in order to boost the yard's net earnings on paper by USD 2.4 billion between 2012-2014.

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The South Korean prosecutor arrested two former executives as part of the case, but the yard did not wish to elaborate on the case to Bloomberg.

"The company will improve transparency and strengthen internal oversight to ensure that this won't happen again," Daewoo Shipbuilding said in the statement.

In June, the South Korean authorities conducted raids of the shipyard which turned up evidence of the account fraud.

In 2015, Daewoo reported a loss of 3.19 trillion won.

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