On Fuzzy Evaluation And Auditing For Internal Control Of The Loan Transaction Of Commercial Banks

Since the 1980s, especially 1990s, in the world scope the financial industry crises especially bank industry crises have frequently happened. From the various countries' massive bank crises cases, we can see that although their origins are different, such " internal causes" as the bad internal management and lacking of the internal control are major ones among all kinds of creating bank crises reasons. By the end of 1990s, after the financial crises spreading Southeast Asia, the various countries' commercial bank and the supervision and management organization had taken the internal control reform as one of the most important reforms in the commercial bank risk management, which has fully proven the importance of the internal control .in the commercial bank management. Therefore, commercial banks' internal control evaluation and auditing is extremely urgent and essential.The goal of this article is to make it more objectctive and accurate by applying fuzzy evaluation theory to commercial banks' internal control evaluation and auditing. Because of the accuracy and feasibility of this kind of evaluation and auditing method, it helps to reduce auditing risks of commercial banks. At the same time, it is advantageous to commercial banks' internal control improvement.This article divides into four parts: The first part has analyzed the flaws of evaluation and auditing methods of commercial banks' internal control. At present, the list method, the flow-chart method and the description method are commonly used among the evaluation and auditing of internal control in commercial banks. The limitation of above assessment methods mainly displays in unfeasibility, personnel's subjective estimate.The second part introduces the fuzzy evaluation theory of internal control. The internal control fuzzy evaluation theory involves the one-stage judgments model and principle and the multistage judgment model and principle, by using the fuzzy mathematics judgment principle to evaluate and audit the internal control system.The third part conducts the fuzzy evaluation and auditing research to the "M" bank. Firstly analyzing its internal control. Secondly, establishing its internal control factor collection. Finally, applying fuzzy evaluation and auditing theory to evaluate and audit its internal control of loan business. That is, establish internal control factor collection of its loan business and give weights to each factor; then, establish its fuzzy evaluation and auditing collection by rating methods; in the end applying fuzzy evaluation and auditing theory to evaluate and audit internal control of loan business of "M" bank.The fourth part has summarized the internal control fuzzy evaluation and auditing of commercial banks. Through applying the fuzzy evaluation and auditing method to the "M" bank, it has overcome the subjective and random evaluation and improved the accuracy of the evaluation result. At the same time it will help to improve management and self-control mechanism of "M" bank.