Internal Control、 Cost Of Capital And Investment Efficiency

Since<enterprise internal control basic norms> being issued in June2008,the ministry of finance, audit, the China banking regulatory commission, securities regulatory commission, insurance regulatory commission and other five ministries and, jointly issued the "enterprise internal control application guide","enterprise internal control evaluation guidelines" and "enterprise internal control audit guidelines" in April2010. From which we can see the importance of internal control. As a result,its effectiveness has caused wide public concern. About the economic consequences of internal control research, both domestic and foreign scholars have achieved certain amounts of achievements. However the research based on the viewpoint of the cost of capital, and focusing on the exploration of the effect of internal control on the investment efficiency has not occured. Therefore,under the background of the publishing of a complete set of internal control guidelines, referring to related research at home and abroad, my article mainly discusses the influence the internal control on the cost of capital and investment efficiency, tests the economic consequences of internal control by the means of empirical test. Besides,I hope my endeavour can help provide inspiration and promotion for future research.Through empirical research methods,My article tries to study the relationship between the internal control and internal control of investment efficiency, the relationship between the internal control and cost of capital, and the role cost of capital plays in the relationship between internal control and investment efficiency through three models respectively. I built the evaluation system of quality of internal control in order to calculate the index of internal control of listed companies, and therefore used the Cindex as the main explanatory variables;As to the aspect of investment efficiency, I use Richardson (2006) model, which is generally recognized and widely used at home and abroad by scholars as the measure level of corporate investment, and used it as the explained variables. Besides,I calculated the company cost of capital and used it as explained variable to study the internal control and its correlations, and to further explore as an intervening variable between investment efficiency and internal control effectiveness. Accordingly, I kept respectively (Levi, t) on the asset-liability ratio, the company size (Sizei, t), institutional investor shareholding (Institutionsi, t), the first big shareholder’s shareholding equity interests (Firstshrhldi, t),(Utlci, t), corporate borrowing (Loani, t) are key factors in the control.First of all, this article selected1120samples of A-share from the Shanghai and Shenzhen’s main board listed companies in2011, and therefore built internal control evaluation index system, calculation of the internal control index, the interpretation of the main variables of as below; Company’s cost of capital is calculated as the internal control and capital cost model was explained variable and internal control, the cost of capital and investment efficiency model explain one of the variables, used Richardson (2006) model to measure the various enterprises investment level of each year as the internal control and investment efficiency,;internal control,the cost of capital and investment efficiency and interpreted variable and investment efficiency. Secondly,by using the empirical test results, this paper respectively describes the companies internal control level, investment efficiency level and cost of capital. Finally, as the result of the regression results of three models analyzed, I came to the final conclusion.In the aspect of the features of my article, it draws on MacKiunonDP, WaI. SiGet et al.(1995) and WenZhongLin (2005) for the mediation effect of study, and using the empirical method to examine the role the cost of capital plays between the internal control and the investment efficiency.For the benifitful desire,I hope to make contributions to the construction of internal control in our country, effective use of the cost of capital of the intermediary effect, by means of use intervening variable of capital cost,in order to improve the service efficiency of funds of listed companies and investment level. What’s more important,I hope to bring the development of national economy, nicely and fast.