POSCO : Consolidated 2021 - 1Q Audit Report

POSCO

and Subsidiaries

Condensed Consolidated Interim Financial Statements (Unaudited)

March 31, 2021

(With Independent Auditors' Review Report Thereon)

Table of Contents
	Page
Independent Auditors' Review Report ................................................................................	1
Condensed Consolidated Interim Financial Statements
Condensed Consolidated Interim Statements of Financial Position ..................................	3
Condensed Consolidated Interim Statements of Comprehensive Income .......................	5
Condensed Consolidated Interim Statements of Changes in Equity.................................	6
Condensed Consolidated Interim Statements of Cash Flows ...........................................	8
Notes to the Condensed Consolidated Interim Financial Statements.............................	10

Independent Auditors' Review Report

Based on a report originally issued in Korean

The Board of Directors and Shareholders

POSCO:

Reviewed financial statements

We have reviewed the accompanying condensed consolidated interim financial statements of POSCO and its subsidiaries (the "Company"), which comprise the condensed consolidated interim statement of financial position as of March 31, 2021, the condensed consolidated interim statements of comprehensive income, changes in equity and cash flows for the three- month periods ended March 31, 2021 and 2020, and notes, comprising a summary of significant accounting policies and other explanatory information.

Management's responsibility

Management is responsible for the preparation and fair presentation of these condensed consolidated interim financial statements in accordance with Korean International Financial Reporting Standard ("K-IFRS") No. 1034 "Interim Financial Reporting". The Company's management is also responsible for the internal controls determined necessary to prepare condensed consolidated interim financial statements free of material misstatements due to error or fraud.

Auditor's review responsibility

Our responsibility is to issue a report on the condensed consolidated interim financial statements based on our reviews.

We conducted our reviews in accordance with the Review Standards for Quarterly and Semiannual Financial Statements established by the Securities and Futures Commission of the Republic of Korea. A review of interim financial statements consists of making inquiries primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Korean Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our reviews, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements referred to above are not prepared, in all material respects, in accordance with K-IFRS No. 1034 "Interim Financial Reporting".

Other matters

The procedures and practices utilized in the Republic of Korea to review such condensed consolidated interim financial statements may differ from those generally accepted and applied in other countries.

The consolidated statement of financial position of the Company as of December 31, 2020, and the related consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, which are not accompanying this report, were audited by us in accordance with Korean Standards on Auditing and our report thereon, dated March 4, 2021, expressed an unqualified opinion. The accompanying condensed consolidated statement of financial position of the Company as of December 31, 2020, presented for comparative purposes, is consistent, in all material respects, with the audited consolidated financial statements from which it has been derived.

Seoul, Korea

May 14, 2021

This report is effective as of May 14, 2021, the review report date. Certain subsequent events or circumstances, which may occur between the review report date and the time of reading this report, could have a material impact on the accompanying condensed consolidated interim financial statements. Accordingly, the readers of the review report should understand that the above review report has not been updated to reflect the impact of such subsequent events or circumstances, if any.

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POSCO and Subsidiaries

Condensed Consolidated Interim Statements of Financial Position As of March 31, 2021 and December 31, 2020

(Unaudited)

(in millions of Won)	Notes		March 31, 2021		December 31, 2020
Assets
Cash and cash equivalents	21	W	4,546,138	4,754,644
Trade accounts and notes receivable, net	4,21,26,27,34		8,953,757	8,120,619
Other receivables, net	5,21,34		1,736,992	1,494,239
Other short-term financial assets	6,21		13,129,801	11,709,209
Inventories	7		10,253,347	9,051,790
Current income tax assets			33,396	49,481
Assets held for sale	8		48,074	34,210
Other current assets	14		740,693		616,623
Total current assets			39,442,198		35,830,815
Long-term trade accounts and notes receivable, net	4,21		76,191	86,423
Other receivables, net	5,21		1,186,717	1,195,962
Other long-term financial assets	6,21		1,710,782	1,561,807
Investments in associates and joint ventures	9		3,896,677	3,876,249
Investment property, net	11		998,405	994,781
Property, plant and equipment, net	12		29,471,591	29,400,141
Intangible assets, net	13		4,348,672	4,449,432
Defined benefit assets, net	19		71,346	86,149
Deferred tax assets			1,356,921	1,335,154
Other non-current assets	14		263,114		270,060
Total non-current assets			43,380,416		43,256,158
Total assets		W	82,822,614		79,086,973

See accompanying notes to the condensed consolidated interim financial statements

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