Study On The Internal Control Mechanism Of The Listed Companies

Internal control is a process that is processed by board of directors, managers and staffs. The goal is to ensure efficiency and effect of operation, implement of related laws and reliability of financial report. It can make financial report accurate, reliable and timely. In order to make enterprises'internal control to perform, we should attach internal control mechanism that is beneficial to perform internal control. This paper consists of seven parts. Chapter one, which is the part of introduction, explains the research background and purpose, and briefly reviews the internal control research in home and aboard. It also clearly purposes the research approach and the ways of thinking, and puts forward some possible innovations. Chapter two briefly reviews the concept of internal control. Internal control includes five factors: surroundings of internal control; appraisal of risks; activity of control; information and communication; supervision etc. Among them, surroundings of internal control is the most important that determines the result of perform of the whole system. Appraisal of risks is also important that can not be ignored. According to report COSO, surroundings of internal control and appraisal of risks are the keys to improve efficiency and effect of internal control. Chapter three, internal control of the listed companies in the condition of corporate governance analyses the relation of corporate governance and internal control. On the one hand, corporate governance is the foundation of internal control. On the other hand, corporate governance and internal control have the identity and interaction. In the condition of corporate governance, internal control includes two sides: internal control mechanism and internal control system. Chapter four is construction of independent director system. Firstly, it analyses the present conditions of board of directors; secondly, it explains lawful position and responsibility of independent directors; lastly, in connection with current problem of independent director system in china, it provides concrete improving ways such as defining fixed position of function. Chapter five, internal risk control system of corporate governance firstly analyses basic elements of controlling risks; then points out that we should consult corporations in Europe and in America to make risk management mechanism; lastly, it explains that risk control mechanism how to control risks. Here the example is selling on credit business in industry. Chapter six, appraisal systems of internal control mainly introduces three appraisal styles of internal control: self-appraisal; internal auditing; supervised by others. These three styles consist of appraisal system of internal control. They are all important and can not be ignored. The emphasis is to analyze every subject of appraisal and ways of appraisal. In addition, this chapter introduces comprehensive appraisal way, another appraisal way that uses principle of blurred math. It can be deeded as supplement to self-appraisal way. Chapter seven, build of publishing system of internal control analyses the current situation of publishing of internal control. It points out that three ways must be valued in order to improve publishing system: strengthening the construction of internal control laws; improving related prescription of publishing; strengthening supervision of publishing.