Research On Efficiency And Appraisal Of Internal Control In Listed Companies Based On Analysis Of The Annual Reports Of Finance Companies

In the beginning of 2008, the dealer-cheating case occurred in France's Societe Generale Bank shocked the world. It is a big bomb for the world economy which is now suffering the sub-prime mortgage crisis. Again, the internal control system becomes the key point in this cheating case. Same scandal occurred again in big commercial bank after the bankruptcy of Bahrain bank thirteen years ago. After the publishing of'Sarbanes-Oxley Act', the regulations on listed companies'internal control all over the world have been enhanced, new rules on compelled disclosure have been published continuously. However, from the France's Societe Generale Bank cheating case, we can see that one of the reasons that caused the 7.2 billion euro loss is the failure of internal control. The internal control system must be improved to make sure that the listed companies can keep stable and low-risk. But the truth is the ability to control the risk of internal control system doesn't reach the level that people expect. The subject on the efficiency and the appraisal of internal control needs further research.For the listed companies in China, the crisis in another word is not always a bad thing, it is also a chance to make our own internal control system clear. Complicated circumstances of market needs Chinese companies improve their abilities in managing varieties of risks. In order to avoid the same tragedy occurring in China, it is necessary to make deep research on efficiency and appraisal of internal control system. Focusing on the risk-managing factor, this paper reviews the development of basic theories of internal control, describing the impact of'SOX Act'on internal control research, then analyzes the real conditions of economy and listed enterprises. By comparing the annual reports of listed companies that belongs to financial industry and the methods by which sample companies deal with the sub-prime mortgage crisis, we can conclude the experiences of internal control and risk-managing methods so as to promote the development of internal control in other industries. The innovation of this paper is that by analyzing the listed companies in financial industry to get the experiences of internal control and risk-managing methods, we can use these technologies and experiences to promote the perfection of other industries'internal control.