Research On The Relevance Of Internal Control And Financial Information Quality

Enterprises published financial report is an important basis for business management authorities, investors, creditors, government regulatory agencies and customers and other stakeholders in relevant decision-making. The quality of financial reporting information directly affects the interests of the relevant decision makers. Reasonable assurance as to the reliability of financial reporting is one of the objectives of internal controls. Internal control by the internal environment, risk assessment, control activities, information and communication, and supervision of these five interrelated elements, the formation process of corporate financial reporting, thus affecting the quality of financial information. Throughout the capital market development history, whether domestic or foreign, declining relevance and reliability of financial information fraud, financial fraud and other financial reports, not only to rely on stakeholders to bring decision-making in the financial statements a huge loss, but also that the capital market to optimize resource allocation function can not be achieved, seriously endangering the health of the sound development of capital markets. Especially after the occurrence of major fraud cases of recent years, making more and more investors realize the level of quality of corporate financial information depends on the enterprise’s internal control. Internal control is how to ensure the quality of financial information has become the focus of attention of investors. Therefore, it is necessary to strengthen internal control and quality of financial information.The contents of this article is divided into five chapters:the first chapter of the introduction part of the First Summary of this research background and significance, the research at home and abroad were reviewed, and describes the structure and layout of this article. The second chapter first describes the evolution of the internal control connotation. Then given the connotation of the quality of financial information used in this paper defines and analyzes the quality of financial information requirements and measurement methods. Finally, the principal-agent theory, the financial information supply chain theory and signaling theory discusses the relationship between the quality of internal control and financial information. The third chapter begins with collecting the data disclosed by the Deloitte research report and listed companies on China’s internal control and quality of financial information the status quo description, and discusses the relationship between the quality of internal control and financial information from the perspective of internal control. Chapter IV draws on the basis of previous research, the internal control model of comprehensive evaluation index used to measure the enterprise’s implementation of internal control effect, the type of audit opinion as an alternative indicator used to measure the quality of listed companies’ financial information, and Logistic regression analysis, analysis of the correlation between the two. Chapter on the basis of the theoretical and empirical research, come to the conclusion of this study, recommendations to improve internal controls and improve the internal control of listed companies to improve the quality of financial information point of view.The innovation of this paper and features is a systematic review of the relationship between the quality of internal control and financial information; refined analysis of the various elements of internal control on the quality of financial information in the empirical part of this article not only through the index of the internal control elementsthe score reflects the internal control the overall state of internal control self-assessment report is a certified public accountant audit the external, more objective indicators to measure the status of internal control. This study will help listed companies to improve internal controls, improving the quality of financial information, and promote the healthy development of capital markets.