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MJ Company's Production And Inventory Cycle Internal Control Study

Posted on:2012-07-05Degree:MasterType:Thesis
Country:ChinaCandidate:Y Y LiFull Text:PDF
GTID:2189330338497218Subject:MPA
Abstract/Summary:PDF Full Text Request
Internal control, known as the stabilizer for the development of modern enterprises, is playing a quite vital role in the surviving and developing of the enterprise. According to the investigation, 70% of bankruptcies are caused by the weakness of internal control. After any well-known enterprises have closed down by the absence of internal control, people paid more attention on the internal control.The manufacturing enterprises mostly take the production and marketing as the main line. Production process is the core of business operation. It runs through the whole economic activity of the enterprise. The purpose of the implementation of internal controls is not only to prevent self-serving and corrupt, but also to reduce losses and waste, which is performed significantly in production and inventory cycle. Generally speaking, internal control of production and inventory cycles includes both internal control of inventory and cost-accounting system. Compared to other business cycles, the production and inventory cycle is more complex. In China, the internal control of production and inventory cycles is at the early stage, whether at the theoretical level or in the practical aspects. Management should be comprehensive. It is an urgent to implement the effective internal controls of production and inventory cycle.This article first reviewed the development of the internal control in our country as well as overseas, discussed the specific meaning of internal control, and emphasized the theory of five elements of COSO framework. Then the article analyzed the theory of internal control in production and inventory cycle. In accordance with the above theory, this article introduced the specific process and implementation situation of internal control of the production and inventory cycle in MJ Company. And then combined with the company management reality the paper analyzed the existence problem of the internal control of the production and inventory cycle in the company. These problems mainly occurred in the key points of the internal control in the cycle, including the productive plan, inventory control, cost accounting and information communication. In addition, problems also appeared in the general environment such as the human resource policy and the internal control monitoring. The article sums up three main reasons. It included the issues of staff quality left by enterprise reformation, lack of employment mechanism and inadequate enforcement of internal control. After that, the article put forward specific suggestions to improve the internal control of production and inventory cycle in MJ Company using the theory of five elements of COSO framework. It is believed that MJ Company's internal control of the cycle would be able guarantee its effectiveness by the improved production planning, better inventory management, appropriate cost accounting methods, modern information management technology, suitable internal control environment and perfect monitoring measure. Finally, the article mentioned some thoughts in the similar enterprises, and emphasized to build the internal control with the perspective of the entire enterprise. And the article analyzed the key points of internal control of production and inventory cycle in small and medium manufacturing enterprises. It hoped to play a certain reference.
Keywords/Search Tags:Internal control, production and inventory cycle, COSO framework, manufacturing enterprise
PDF Full Text Request
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