Identification Standards Of Internal Control Deficiencies Of Baoshan Iron & Steel Co.,Ltd

The scandals of listed companies represented by Enron and World Com in the United States have reflected the chaos of the company’s internal operation and management,causing great losses to the interests of investors and damaging the public’s trust in listed companies.In order to rebuild the public’s trust in listed companies and promote the healthy and orderly development of the capital market,the United States took the lead in applying the concept of "internal control" to the internal operation and management of companies,and achieved certain results.China follows closely the development of international theory,and gradually introduces internal control into China on the basis of absorbing and drawing lessons from international internal control theory,and gradually promotes internal control from listed companies to a wider range of companies.From the result,the establishment of internal control has effectively standardized the operation and management of listed companies.However,the establishment of internal control does not mean that listed companies will still be "invulnerable" in the face of various risks.It requires listed companies to continuously improve the effectiveness of their internal control and improve their ability to cope with risks.However,the development trend of the internal control index shows that the internal control situation of listed companies is not optimistic,and the urgency of improving the effectiveness of internal control is increasing.The internal control deficiency is the key to affect the effectiveness of internal control of listed companies.In order to improve the effectiveness of internal control,listed companies must develop identification criteria to identify internal control deficiencies.However,the relevant systems and policy documents have the dual attributes of "mandatory" and "guiding" for the establishment of identification standards,which provides the listed companies with discretion in identifying internal control defects,which is not conducive to the establishment of scientific,standardized and enforceable internal control defect identification standards for listed companies,and also leaves room for the study of the establishment and disclosure of internal control defect identification standards for listed companies.Based on the principal-agent theory,impression management theory,stakeholder theory and information asymmetry theory,this thesis takes Baoshan Iron & Steel Co.,Ltd,a listed company in the heavy pollution industry,as a research case,and combines with the standard for determining internal control defects,and studies the formulation and disclosure of the quantitative and qualitative standards for determining internal control defects of it through the logical framework designed to formulate and disclose the standard for determining internal control defects.In terms of quantitative identification standards,this thesis focuses on the selection of quantitative identification standards and indicators of internal control defects in financial reports and the degree of leniency and strictness.In terms of qualitative identification standards,this thesis focuses on the content specification of qualitative identification standards of internal control defects in non-financial reports.The research found that the establishment of internal control defects identification standards of it has "anchoring effect" which is not conducive to dealing with complex risk situations.Moreover,the limited selection of indicators leads to significant interannual fluctuations in importance levels,which is not conducive to the development of internal control evaluation work.In terms of disclosure,it has issues such as insufficient basis for formulation,insufficient disclosure of the effectiveness of recognition standards,and the need to supplement the process of identifying internal control deficiencies which have hindered the further improvement of the internal control effectiveness.In view of the above problems,this thesis puts forward corresponding optimization suggestions,with a view to enriching the extension of the theory and the research on the identification standard of internal control defects in theory,providing reference for it to formulate and disclose the identification standard of internal control defects in practice,and then providing reference for listed companies in the industry,improving the ability of listed companies to identify internal control defects,and promoting the effectiveness of internal control of listed companies.