The Study On The Effects About Information Disclosure Of Internal Control Of Listed Companies

At present, the economy of China is in a rapid development stage, the stock market is also in the process of continuous improvement. However, the ongoing accounting fraud scandals in recent years give a wake-up call to all investors and listed companies, weak corporate governance mechanisms of internal control and lacking of information disclosure is the direct reason of the tragedy of accounting, the entire society should pay great attention to the importance of the information disclosure of internal control. The information disclosure of internal control helps the managers identify the deficiencies of internal control, improve internal control and the quality of accounting information. The information disclosure of internal control also can reduce the asymmetric information, it help investors understand the enterprise’s internal control and the credibility of financial reporting, it also helps investors acknowledge the risk of investment and make the right decisions. The investors are fully aware of the importance of good internal control system to a valuable company, besides a good operating performance and broad development prospects.China’s securities regulator is also working on the construction of internal control system of information disclosure, the new guidelines on internal control of listed companies and the basic norms of internal control demand the managers of listed companies to issue the self-evaluation report of internal control and the verification of evaluation of Certified Public Accountants, together with the annual report disclosure. Now, the research on market effect of information disclosure of internal control have a certain theoretical and practical significance.This paper according to the introduction, the theoretical basis, the study design, the statistical analysis, the empirical analysis, the research conclusions and policy recommendations such a route on research, there are the following six parts:In the first part, it elaborate the research background, the research motivation, the research significance, and to comb the relevant literature, then pointing out the shortages and contributions of this research, the research motivation and the main contribution of this article are put forward on the basis above.In the second part, it firstly elaborate some core concepts involved in this article, and then take a detail explanation and analysis to the fundamental theory of this study, it can make a groundwork for the following research, the theory include effective capital market theory, the principal-agent theory, information asymmetry theory and signal transmission theory.In the third part, on the basis of our national conditions and institutional background, it firstly proposed the Assumption on the effect of internal control information disclosure of listed companies in China, and then explain the selection of the sample, describe the principles and sources of data, design the related variables, including:explanatory variables, controlled by the explanatory variables and variables, finally it constructed the model on the basis of the study above.In the fourth part, for nearly three years of descriptive statistics analysis of sample data, through the analysis can we have a preliminary understanding of internal control information disclosure. Come to the conclusion is that there are more companies inclined to disclose self-assessment report of internal control, but there are still nearly50%of the companies don’t want to disclose the evaluation of certified public accountant.In the fifth part, with Excess earnings method and empirical analysis of multiple regression method, through an empirical study to test and verify the market effects of internal control information disclosure of listed companies in China. First of all, by depicting means testing, preliminarily analyzed the effect of different markets for the group, and then by correlation analysis of model involving this article to verify model for collinearity issues between variables, followed by multiple regression analysis of the sample company data from2009to 2011.In the sixth part, by analysis of the text before, it can make the conclusion of the study and point out related policy suggestions, at the end of this article indicates the shortcomings of this article.This article by empirical analysis of market effect of internal control information disclosure in China listed company, have the conclusions in the following:The overall situation of internal control information disclosure in listed company of China improved; in a relatively short time of annual report announced, the company in different disclosure situation have different average excess income rate; the company in good disclosure situation have positive market response, the company in bad disclosure situation have negative market response; the average excess income rate and the disclosure level of internal control information are negative related.The main innovation of this article is the classification method of the explanatory variable, overcoming the shortcomings that subjective factors are considerably big in qualitative methods or scoring methods during the past, and to meet the requirements of the new guidelines and the Code, in accordance with whether to disclose the evaluation that a certified public accountant to verify and the self-evaluation report, divide the listed companies into three groups, which can help show the implementation and effectiveness of the new regulations in the listed company.