The government is assessing the conditions of local companies involved in North Korean ventures outside of an inter-Korean industrial complex that were forced to pull out of the country due to strained cross-border relations, an official source said Thursday.

The unification ministry insider said the review is part of Seoul's efforts to limit the fallout to the business sector and reflect rising demands from entrepreneurs who had invested in North Korea in such projects as the Mount Kumgang resort on the east coast.

"An examination of business activities and losses incurred by businesses began Tuesday," said the official, who declined to be identified. He said the review is a follow up to assessments carried out in 2010 and 2011 to determine the damages incurred by South Korean business ventures that had operations in the North.

The official said the purpose of the week-long inspection is to examine the financial and operational conditions of companies that were in North Korea before having to evacuate, and to discern what business activities they have been trying to pursue since returning home.

The information can be used to determine how government funding support was used and update information it has on business operations by local companies in the North.

"There have been growing calls by companies that had invested outside of Kaesong to be compensated for losses they incurred when Seoul halted inter-Korean operations after the sinking of a South Korean warship in March 2010 and the shooting death of a tourist at the Kumgang resort two years earlier," he said.

Seoul had ordered an immediate halt to tours of Mount Kumgang after the shooting death of a female tourist, while all economic ties with the North were severed after the torpedoing of the Cheonan warship with the exception of the Kaesong manufacturing zone.

Operations at Kaesong were halted only after the North, citing South Korean provocations, withdrew all of its workers on April 9.

The removal effectively stopped all operations at the joint venture, which started churning out product in late 2004.

Unlike the attention and support being directed at Kaesong companies, those that invested in other parts of the communist country generally did not receive extensive assistance. (Yonhap News)