Correlation Analysis Of Internal Control And Corporate Profitability In The Manufacturing Industry

The effective internal control is the foundation of company development. Increasing the profitability of the company must pay attention to the effectiveness of internal control construction. Nowadays, the more research on the effectiveness of internal control, the more effective internal control is. But the study of relationship is very scarce. This article conducts the research from this aspect. It expected to get some inspiration from these two aspects of the relations. At present, the industry of our country is developing, more and more cooperate was set up. With the continuous development of our economy, manufacturing companies are more and more requirement on internal control.Therefore, studying on the effectiveness of internal control in the manufacturing is worthful. From where I stand, the manufacturing company’s internal control and profitability levels linked. To explore how to improve the profitability must focus on the internal control in these cooperates. In this paper, the author paid attention to the effectiveness of Company operation from the point of the view of the manufacturing company’s internal control.This paper carries on the discussion to internal control manufacturing company efficiency and profitability. Using correlation analysis and regression test proved that there is a positive correlation between these. The research put forward some useful suggestions from the internal control for improving the manufacturing companies to enhance profitability perspective.The first chapter is the introduction part. Firstly, this part describes the purpose and significance of the research background. Secondly, it introduces this article research mentality and the method. The last, it puts forward research framework and points out the main control.The second chapter is the literature review. First, review the effectiveness of internal control related literature at home and abroad. Second, the evaluation of the profitability through the related literature at home and abroad is reviewed. The last part is the research on manufacturing the effectiveness of internal control and its profitability relationship.The third chapter is the summary of theory. This paper expounds and defines the theoretical foundation of the thesis.The fourth chapter is the research design. This chapter presents the selection, data sources, and research hypothesis of correlation between the two parts. And, this part selected the variables in the regression model design. It paved the way for the following empirical analysis.The fifth chapter is the analysis of empirical testing and results. This part researched the relationship between the effectiveness of internal control and profitability of manufacturing companies.The sixth chapter is the policy suggestion. This part summarized the above mentioned, the limitations of the research and the further research direction. Put forward the policy suggestions for how to improve the internal control.This paper confirms the internal control and the profitability of the manufacturing company. It concluded the positive relationship through empirical study between the two parts. This conclusion is not only means that the manufacturing company of effective internal control have positive effects on their profitability, but also shows the invalid or ineffective internal control will hinder its profitability.Through this study, we think that we should strengthen the construction of internal control in the manufacturing company. Only reducing the possibility of failure can ensure the development of manufacturing industry profitability continued.