Internal Control Research About Listed Commercial Banks Of China

The global economy has accelerated the integration process with the constantly in close contact with the countries of the world, and the world in financial and other aspects of mutual cooperation, coordination, mutual penetration and competing trends have become increasingly prominent, and the global financial industry has become a close contact which cannot be separated. Since the financial crisis in2008, Western governments have introduced a quantitative easing monetary policy to stimulate economic growth. In2012, the euro-zone countries and banks will face the pressure of huge amount of debt due to financing which is also very great pressure, the debt crisis and banking crisis in the European economy faltering, will be more difficult to rebuild public confidence in the economic and market, the fate of EU countries will be more concerned. For example, the Greek government faces high welfare and low surplus predicament and cannot support the excessive deficit spending by the public finance surplus, Greece and other EU countries have a debt crisis. The rating agencies continue to reduce sovereign debt rating, boosting further contagion. April26,2012, Standard&Poor’s lowered Spain’s credit rating two notches, saying that in the case of contraction in the economy and the banking sector in trouble, it is expected that the country’s government budget deficit deterioration than previously expected. Standard&Poor downgraded Spain credit rating from A+to BBB+, outlook will also be rated as negative, adding that situation in Spain could deteriorate further, which can lead Europe’s economy to bottom again.In the current European crisis, China’s commercial banks are also very difficult not to be affected. The debt crisis in Europe has staged into the banking crisis stage, European and American banks have withdrawn funds to help themselves, China’s banking sector is hard to be spared. Because of the increasingly stringent capital adequacy ratio listed commercial banks also feel the pressure of unprecedented capital supplement, strategic transformation become more and more imminent.Internal control of listed banks means to develop and implement a series of procedures and systems, active in prevention of risk, and effective control and ex-post evaluation process designed to achieve the listed banks in the development of strategic and operational target, it is a dynamic process and mechanisms. With the constantly increasing risk of China’s listed banks, our government and regulatory authorities also continue to strengthen the construction requirements of listed banks’internal control, internal control has become the basis for activities of China’s listed banks, it can also ensure bank’s long-term stable operation and sustainable development of a system to help banks achieve long-term profitability, and provide reliable financial and management reporting, compliance with laws, regulations, policies, plans, internal regulations and procedures, to reduce accidental loss or damage to reputation. In recent years, the emphasis of China’s listed banks on the internal control building continue to strengthen, whether the head office or branches at all levels of internal control have achieved some success:the gradual optimization of the internal control environment, risk management system is established, internal control measures continuous improvement, information exchange and feedback is relatively smooth, and gradually improve the monitoring and corrective mechanisms, but there are still problems like a poor sense of internal control, governance structure does not play its due role, partial long chain of organizational structure, human resources management bureaucratic, the existence of structural defects in the performance evaluation and accountability system, risk management norms and the degree of specialization is not high, the longitudinal flow of the authenticity and validity of the lateral flow is not high, the degree of specialization of audit supervision is not high and so on. Solve these problems is an urgent and important issue facing the listed banks, which is the significance of this study.This paper focuses on the internal control of listed banks in China, and use16listed banks in China as overall samples for analysis. The full text is divided into five parts:Part Ⅰ:Introduction. Overview of the current economic situation at home and abroad, the overseas business and investment conditions in China’s listed banks and the multiple challenges faced by the background of listed banks’internal control problems, topics of significance in the analysis of global economic integration, domestic and international literature review, the contents framework of the paper and research methods, innovations and shortcomings.Part Ⅱ:the theory of internal control of listed commercial banks in China. Control and internal control definition and characteristics of listed banks in the development of the internal control theory, features of listed banks’internal control, internal control framework and methodology, as theoretical guidance discussed later.Part Ⅲ:Internal control status and cause of the problem of listed commercial banks in China. First an overview of the current situation of China’s listed commercial banks, followed by listed banks as a whole as a sample for analysis, and select the relevant indicators to conduct feasibility studies to identify common problems and individual problems that exist in the internal control of listed banks in China, and the formation of the causes of these problems were analyzed.Part Ⅳ:International Comparison of listed commercial banks internal control and revelation. Analyze the experience of developed countries from the U.S. Citibank internal control features and experiences, characteristics and experience of the internal control of the British HSBC Bank and Japan Bank of Tokyo-Mitsubishi, internal control features and experience to analyze, summarize China’s listed banks on improving the internal control system the inspiration for the listed banks in China’s internal control reference.Part Ⅴ:Measures recommendations for improve internal control of listed commercial banks in China. Based on the comprehensive analysis of the above sections, set the objectives and principles of China’s listed banks to improve their internal control system of China’s listed banks to further improve the internal control framework, corporate governance structure, financial and accounting control mechanisms to strengthen risk assessment and response to enforcement, and improve China’s listed commercial bank risk early warning mechanism to strengthen the policy of internal audit and audit oversight and corrective mechanisms, smooth communication channels and improve the supporting policies put forward specific proposals.