Research The Influence Of Corporate Governance Structure On Quality Of Internal Control

Internal control is a dynamic process that it is designed to achieve organizational objectives in essence. As an institutional arrangement. internal control is the basis of the management of enterprise. which plays an important role in ensuring the management of enterprise legal and compliance, financial report and related information true and completely and improving operational efficiency and effectiveness. In recent years, international and domestic financial scandals continue to occur, damaging to the investors seriously and disrupting the economic order. To avoid the occurrence of such large-scale scandal, people are spontaneously turning to the internal control. And internal control has been received unprecedented attention. In the course of the study for internal control, people start looking for the deeper level of factors that affect the internal control. Corporate governance is considered to be the most critical factor that affects the quality of internal control.Domestic and foreign government also attaches great importance to improve the quality of internal control from corporate governance. The<Shanghai Stock Exchange Guidelines for Internal Control of Listed Companies>,<Shenzhen Stock Exchange guidelines on internal control> that issued in 2006 and the <internal control of the basic norms> that jointly issued by Ministry of Finance. Securities and Futures Commission, the Audit Commission, China Banking Regulatory Commission. China Insurance Regulatory Commission in 2008 and<internal control supporting the guidelines> that issued in 2008 make great effort to improve the quality of internal control from corporate governance.<Sarbanes- Oxley Act> is more strictly, emphasizing management layer must fully responsible for internal control, and evaluate the effectiveness of internal control in the annual report, and also need register accountant give audit reports. Thus, the practice of internal control has entered a new stage.However, there is a little empirical research on the corporate governance influence on the quality of internal control, far from meeting the needs of management practice. Therefore, this article studies it on the basis of domestic and foreign research. This article reviews the basic theory related to the corporate governance and internal control firstly, and then analyze the influence of internal control from the corporate governance structure characteristics, such as ownership structure, board characteristics, management incentives, supervisory features, and put forward hypotheses. Then this article examines the influence of the internal control quality from corporate governance by the information of internal control which from listed company. We find that the proportion of state-owned shares has a negative correlation with the quality of internal control, the proportion of corporate shares has a negative correlation with the quality of internal control, the company which's chairman and general manager have separate jobs has uncommonly higher quality than which's chairman and general manager have unity jobs, the company that set audit committee has uncommonly higher quality than which doesn't set, the salary of executives has a positive correlation with the quality of internal control. Finally, according to the results of empirical and reality, we give a suggestion that improve our internal control.