Research On Ownership Structure, Board Characteristics And Effectiveness Of Internal Control

In December,2001, Enron began to seek for the protection of US bankruptcy court. In the bankruptcy lists, Assets amounts to49.8billion dollars. The company became the largest bankrupt enterprise in American history. In July,2002, WorldCom fell into the scandal of false profits. And then, Xerox was also been reported that it has a total of6billion dollars about false business incomes in last five years. These financial scandals exposed that American corporate governance, internal control exist serious flaw, prompted "Sarbanes-Oxley Act" come on stage, provided the basis for disclose internal control information. Along with Chinese enterprises facing more and more internal and external risk, internal control has been paid more and more attention. After learning lessons from American internal control, in April,2010, Ministry of Finance and other ministries jointly promulgated "enterprise internal control supporting guidance". This set of guidance and " basic standard for enterprise internal control", jointly build the Chinese enterprise internal control standard system, since January1,2011, first should been carried out by those listed companies that has listed qualification both in home and abroad, Then, gradually extended to all listed companies. It is an important measure for improving listed and unlisted medium-sized enterprises’operation and management level. In fact, the theory of internal control has been applied to enterprise risk Control, the Shanghai and Shenzhen stock market required listed companies to disclose internal control report. Then the internal control of the listed companies is valid or invalid? Factors which influence the effectiveness of internal control is very worthy of our study. This paper uses empirical research methods, to verify the relationship between ownership structure, board characteristics and the effectiveness of internal control.In order to solve the above problems, the full text is divided into five chapters. The first chapter mainly includes the background, significance of research, literature review, research method, the research mentality, the research contents and research problem definition; The second chapter mainly carries on the theoretical analysis, respectively analysis internal control and corporate governance theory, and then analysis the correlation between them; the third chapter through multiple linear regression model to verify the hypothesis, and the assumptions and conclusions do not matching, need further analysis; the fourth chapter based on the third chapter, we draw conclusions, put forward corresponding policy recommendations; the fifth chapter is the end of this article, point out the innovation, defects and prospects.Based on theoretical analysis and empirical research, get the conclusion. The research results indicate that internal control system of the listed company is not perfect, has many defects; maintaining a reasonable degree of ownership concentration and the reasonable degree of ownership balance is beneficial to improving the effectiveness of internal control; the reasonable scale of the board of directors and the effectiveness of internal control are related, the size of the board of directors increase, resulting in internal control effectiveness continued to decline; The proportion of institutional ownership and the effectiveness of internal control was positively related to. Finally, based on the empirical conclusion, put forward the corresponding policy suggestions.