Research On Voluntary Disclosure Of Auditor's Internal Control Reports Of Chinese Listed Companies

Rencently, with a range of domestic and international financial fraud incidents have occurred, national regulatory authorities give a high degree of attention on how to create more effective internal control system. In June 28, 2008, Ministry of Finance, Securities and other five departments jointly promulgated the Basic Standard for Enterprise Internal Control. The norms define the listed companies that carry out the standards have to establish the system of internal control self-evaluation, and disclose the annual self-evaluation report, and the listed companies can employ a securities and futures business qualified accounting firm to audit the effectiveness of internal controls. The norms wad carried out on July 1, 2009. We can see that our country require listed companies to disclose the annual self-evaluation report, but did not make the mandatory disclosure requrements on the auditor's internal control report(the "Assurance Report") except the ipo company. However, according to statistics, the 883 listed companies that diclosed the 2009 Annual Report on Shanghai Stock Ecchange main board had 215 listde the auditor's internal control reports voluntarily, and auditor evaluation of audit opinions issued by the inernal control is basiclly an unqualified opinion. The auditors believed that the internal control related with the audited financial statements of listed companlies is effective in all material respects.The company disclosed the auditor internal control will accompanied by a corresponding increase in the cost of their legal risks and disclosures , why did they diclose the auditor's internal control reports voluntarily?The article first makes a thorough review of research achievements at home and abroad, puts forward research ideas and the framework, and combs related concepts. By analyzing the cuurrent disclosure situation of the auditor's internal control report in Chinese listed company which was on Shanghai Stock Ecchange main board in 2009, it provides the problems and its reasons. Then making a theoretical analysis on the factors that impact the listed companies disclosing the auditor's internal control reports voluntary. The hypotheses are proposed from three major aspects: company's own characteristics, corporate governance, financial reporting reliability. Through the methods of Logistic regressions, the paper collects data to test the hypotheses and draws the emprical conclusions from them. The conclusions include: the company size, profitabiliy, the company having internal audit departments, state-controlled is significantly postively correlated to the disclosure of auditor's internal control reports; Listing time, company irregularities is significantly negatively correlated to the disclosure of auditor's internal control reports. Financial leverage, Ownership concentration and the reliability of fiancial reporting haven't significant correlation with disclosure of auditor's internal control reports. Finally, based on these studies, the article brings forward related measures from the macroanalysis and microanalysis, illustrates the localization in the research and the future study trends in order to improve the research framework.