A Research On Improving The Internal Control System For Electromechanical Equipment Asset Management Of Xianghang Hydroelectric Co.,LTD

With the development of economics and society, internal control, as animportant approach for corporations to strengthen the internal management and meetthe external demands, is enriching its own content continually when the corporationsare intensifying its consciousness of risk management. China has promulgatedC-SOX and relevant application documents which become the guidance of differentkinds of companies to implement internal control system, and required Chineselisted companies to perfect their internal control system. Hydroelectric industry is atypical assets intensive industry, and mechanical and electrical equipment assetmanagement is the main job of hydropower enterprise management. Establishinggood internal control system of the electromechanical equipment assets managementis important to reduce the security risk of asset, maintain regular business order andraise the level of profitability.Aiming at the particularity of electromechanical equipment asset managementin hydroelectric companies, this paper has chosen Xianghang HydroelectricIndustrial as the object of the case study. Starting from the characteristics ofelectromechanical equipment asset management, this paper has analyzed its process,tested its present situation and found faults of its internal control system under thefive elements of COSO’s internal control framework which are internal environment,risk assessment, control activities, communication and internal supervision. Finallythis paper suggested the company should optimize the environment, construct therisk identification and assessment system, improve process control activities,consummate information communication mechanism and strengthen the internalsupervision to improve the electromechanical equipment company asset managementinternal control system. Refer to internal control related research results at home andabroad, this paper has chosen a typical case in hydroelectric industry as the researchobject, and expected to perfect its internal control system, reduce operation risks ofthe company and achieve business goals. This article is expected to complement theexisting study of the internal control application and to be a reference for otherhydroelectric industry enterprises’ construction of internal control system.