Research On Control Environment Of China's Enterprises

Internal control is an important part of the company's corporate governance structure, It is very important for the safety and integrity of the company's property and the quality of accounting information, It ensure business objectives and the national financial and economic policy carried out. In the wake of the Enron case, and especially after the "Sarbanes Oxley Act" promulgated, more and more attention was paid to internal control around the world. Internal control environment is the foundation of internal control, and if there were any significant flaws, even if the internal control system which constructed on it was perfect, it may also have difficulty in achieving its target without a solid foundation. But scholars who are study on the internal control environment are still very limited. Enterprises also focus on internal control system, and the foundation of internal control was neglected. Different control environment brings different internal control system, having a good internal control environment is essential to the internal control system. However, compared with abroad country, there is still a certain gap in internal control theory and practice. This goes against the trend of the current of accounting international. How to introduce the world's most advanced internal control concepts, combining with China's unique environment, playing the due role of internal control is still an issue that must be solved.As to the methods in the study, the most common are induction and deductive methods. When analyzing the current situation of internal control, I used the mathematical statistics method and take many listed companies as example, I summarized similarities of the listed company; and got some widespread problems, those methods used are the induction. Finally, I use the general conclusion to guide the practice of internal control practice, this is deductive methods. From the transcript, in the process of grouping common issues into specific ones, the method used is quantitative and empirical research methods, when explaining the conceptual issues, I used a more qualitative,standardized method.My analysis is based on the internal control status of China, and I try to find the mechanism of control environment,the research shows that the effectiveness of internal control is very weak in the enterprises of China, which is disproportionate to the investments in internal controls. This was mainly because that a majority of human and material resources were invested in the building of the internal control system, especially in the accounting system, but the attention putting on the foundation of internal control is not sufficiency. The purpose of my research is finding useful proposal to strengthen internal control environment and to improve the effect of internal control. In the end, I put forward my idea from control environment for reconstructing the internal control system.