A Study For The Current Internal Control System Of W Company

Internal control system is a widely discussed and studied subject and it is an important component of management control. In order to reduce the operating risk and prevent fraud, the companies must standardize business processes and implement the controls on business activities. Internal control is one set of control methods and procedures and is generated by internal mutually dependent relations. The effective internal control enables the company to allocate the resources rationally and improve labor productivity. What is more, it also helps to prevent and detect internal and external fraud. Nowadays, the ability of establishing and improving internal control system is the key to the success of company in launching new IPO. With the development of the economy and the favorable policy by central government for IPO, the construction enterprises, which is an important pillar of the national economy, has also begun to explore the road to go public. However, due to the impact of the traditional planned economy, construction enterprise still face with many accounting irregularities, control weaknesses and other issues. Therefore, construction companies must be in accordance with the listing requirements for the internal control in order to successfully issue IPO.The author participated in the examination of the internal control system for W company and personally experienced that the establishment and improvement of the internal control system plays a crucial role in the development in corporate governance. The authors studied the current status of W company's internal control and examined the internal control of treasure cycle, the internal control of sales and receivables cycle, the internal control of fixed assets and inventory procurement cycle, the internal control of the payment cycle, the internal control of human resources and payroll cycle, and the internal control of construction cost. The author found out internal control deficiencies and problems and put up with the final recommendations. Although it is for W company study, the problems in the company can be found in other companies. Hence, it can be used for reference for other companies to improve the internal control system.