Listed Company's Audit Committee System Research

The purpose of this thesis is to discuss the possibility of establishing the Audit Committee system in China based on an exploratory research on the development of the Audit Committee system in foreign countries.I. Background of ResearchThere are many problems appeared in the activities of business management after twenty years' reforming and opening in China. Especially, in recent years, cases of financial cheating increased rapidly. Therefore, it is important and critical to design a set of internal control system to improve this situation. Many scholars and researchers believe that Audit Committee, an internal control system exists in western companies extensively, is deserve further discussing and understanding. Based on these backgrounds, this thesis is supposed to discuss issues relevant to establishing the system of the Audit Committee in China, with anticipation to offer some useful suggestions and advices to the management of Chinese listed companies. II. Theoretical Framework and MethodologyThis thesis is aimed at the listed companies that issue the A stocks in China stock market, focusing on questions related to establishing the system of the Audit Committee in China.The following is the framework of this thesis: focusing on the central question of how to design the system of the Audit Committee in China, from abroad cases to domestic situations, from generality to specialty, from questions to answers, carrying out research plan step by step. The first part of the thesis is a starting point, mainly focusing on introducing the development of the system of Audit Committee in the United States, with purpose to elicit the question whether it is necessary to establish Board of Supervisors and Audit Committee in Chinese listed companies simultaneously. In the main body of this thesis---the secondpart---the rationality and necessity of establishing the system of Audit Committee in China are firstly presented. On this basis,this thesis further explains the realistic significance and principles of establishing the Audit Committee, the functions of Audit Committee, and necessary legal supports, etc.. The third part of this thesis is a supplement for the second part, focusing on some important issues that need to be solved after the establishment of the Audit Committee.The normative methodology is mainly applied in this thesis. It has the following characteristics: firstly, it emphasizes both the theory and the application. Secondly, it is easy to elicit innovative ideas based on comparing researches. Thirdly, it is possible to undertake a deep research by using this methodology. III. Structure of ThesisThis thesis is composed of three parts: The first part: Introduction of the system of Audit CommitteeThe second part: Establishment of the system of Audit Committee in ChinaThe third part: Relationships between the Audit Committee and different stakeholders in ChinaThe first part: it is a brief introduction of the system of Audit Committee in foreign countries. It begins from the origin of the Audit Committee. Then it introduces the historical development of the system of Audit Committee in the Unites States in particular details. In addition, it gives analysis of the relations between the corporate governance and the system of the Audit Committee in the U.S.A., German, and Japan, with a conclusion that there is not a precedent of coexistence of the Board of Supervisors and the Audit Committee in western companies. The second part: it is the main body of this thesis. It focuses on issues relevant to the establishment of the system of Audit Committee in China. Firstly, it analyzes the rationality of establishing the Board ofSupervisors and the Audit Committee in Chinese listed companies simultaneously. This analysis provides a basic point to the reasoning of this thesis. Secondly, it explores the realistic significance of establishing the system of Audit Committee in China. Thirdly, it explains the following principles that should be followed in establishi...