Internal Control Study Of KH Pharmaceutical Company

Since the1990s, our country has entered a critical period of changing the planned economy to market economy, in which firms began to be truly independent of the government, and were managed independently with self-financing. But the development of economic globalization and regionalization in recent years leads to the heating up competition between international and domestic enterprises. The big ones cannot exist easily, let alone medium and small-sized enterprises, in which the economic added value is low, the production activity is single and management is disordered. In a word, with survival pressure abnormally expanding, medium and small-sized enterprises can’t just rely on high quality products or services to meet their required foundation. If there is any slight managerial loophole, that will lead to their extermination instantly.In order to promote the sustainable development of enterprises, improve the management level and ability to prevent risks, maintain the socialist market economic order and social public interests, the Ministry of Finance, National Auditing Administration, China Securities Regulatory Commission, China Banking Regulatory Commission, and China Insurance Regulatory Commission jointly issued Basic Norms of Internal Control on June28,2008.Then they issued Internal Control Supporting Guidance on April26,2010, so as to strengthen and standardize internal control of enterprises in China by legislation. But Rome is not built in one day, more than two years implementation and practice has not achieved the expected effect, especially among medium and small-sized enterprises in our country which have their own characteristics and industry status that do not adapt to the legislation. Their living condition doesn’t change any more.Take KH pharmaceutical company, one medium and small-sized enterprise, as an example. By considering its internal control status, analyze its existing problems in view of control elements and concrete cases, and then put forward suggestions and measures to improve its internal control system.The main contents of this paper consist of five parts:The first part is introduction. Illustrate the background and research significance of the topic, the writing ideas and research methods, basic contents and framework.The second part is the overview of internal control studies. By combining and comparing the research outputs of internal control, seize the status and differences of internal control theory at home and abroad. Then summarize the strengths and weaknesses of our internal control research.The third part is the basic theory of internal control. Introduce the developing history of internal control at home and abroad, explain the concept of internal control, subject and control elements, limitations and other theories. Then summarize the current general situation for internal control of medium and small-sized enterprises in our country.The fourth part is the process of problem found and analysis. According to the basic situation of internal control in KH pharmaceutical company, introduce its current performance of internal control in view of business process and important cases. Then analyze its existed problems of internal control in view of control elements and concrete cases.The fifth part is about proposing measures to improve internal control. According to the concrete situation of KH pharmaceutical company, put forward policy suggestions and measures to strengthen its internal control system in view of control environment and business process. Then consolidate and improve the internal control of KH pharmaceutical company by process designing.The expected contribution of this paper is in two aspects. According to the internal control of KH pharmaceutical company at present, deeply analyze the existed problems of internal control in view of control elements and specific cases. After optimizing control environment of KH pharmaceutical company, master the key control points better and design the business process in view of its internal control problems and business process. Then KH pharmaceutical company can adopt specific policy recommendations to guide its internal control practice.But taking various factors into account, this paper also has its drawbacks. For the reason that this paper is mainly focused on KH pharmaceutical company’s internal control, the information collected may be influenced by subjective or objective factors, which can have a negative effect on the integrity, reliability, and implementation of the results. So the study result needs to be tested and improved through mathematical empirical research in the future. At the mean time, KH pharmaceutical company is just one of medium and small-sized enterprises in pharmaceutical industry, its company scale, business scope, management and other conditions cannot meet with the industry exactly. So we cannot take this result to infer the basic situation of this industry. To a certain extent, this study is not universal in other company’s study.