Property Rights, Competition And Internal Control

The strict internal control improves the business efficiency, and ensures the existence and development of enterprises. But state-owned enterprises of China are generally in the state that the internal control is low-levelly; this has close relations with property right structure of the state-owned enterprise. Under country's all property right structure, owner's omission, the manager encourages being imperfect, the staff of state-owned enterprise lack and can believe that dismiss threat, lack the factors , such as mechanism ,etc. of eliminating of enterprises to cause and control the loose situation inside the state-owned enterprise together .China National Heavy Duty Truck Group Corp., Ltd. (CNHTC) has the same situation before recombination. But after recombination, CNHTC has set up and implemented strict internal control system. This transition was realized under the condition that has not changed the property right structure. How does CNHTC overcome the adverse effect of the state-owned property right structure on the internal control? What is the key factor that promotes the internal control of CNHTC from loose to strict? This is a theme of this text.The condition of CNHTC before recombination is extremely severe: It is hard to go on suffering huge loss, and it is in the edge of bankrupt. Such a state arouses the attention from governments. The relevant departments determine to recombine CNHTC: CNHTC is managed concretely by Jinan city, and belongs to Shandong province. So owner's roller chain becomes short. The concerns of the governments at all levels and directly concrete owner make the owner of CNHTC supervise dynamics strengthening greatly. It changed the payment function of manager, overcame the question that it is difficult to set up and operate the internal control under the property right structure of state-owned enterprise, impel the operator to set up strict internal control, and guarantee the success of CNHTC recombinant.Serious situation before recombinant make CNHTC go to bankrupt. This breaks the situation that the state-owned enterprise will not be eliminated by the market. Staff' lifelong system has pass out of existence, and a large number of staff face laid-off threat. In this case, it is broken that the staff of state-owned enterprise lacks the unbelievable employment threat. The staff will pay the enormous cost in the lazy behavior. Punish measure change into being can be implemented, that change the staff's payment function...