Factors Related To Quality Of Internal Control Of Listed Companies And The Economic Consequences

With the great competition of global economy, internal control deficiencies and accounting scandals of many domestic and foreign companies have been revealed. Internal control deficiencies result in declining stock prices, financing costs rise, corporate reputation damage. Effective internal control can help improve the market competitiveness of enterprises, improve the management efficiency of enterprises, has an important significance to guarantee the health and sustainable development of enterprise.This paper summarized the factors affecting the quality of the quality of internal control; with the study of real company crisis, with the application of case analysis, taking the Great Northern Wilderness as an example, this paper introduces the basic situation of the internal control, reveal the factors that influence the Great Northern Wilderness internal control quality mainly from the perspective of corporate governance mechanism. From the market performance, financial performance and earnings quality analysis of the defects of the economic consequences of internal control in the Great Northern Wilderness. Study found that, firstly, the ownership concentration is too high, the lack of effective balance mechanism of shareholders, the board of directors lack independence and executive incentive problem may be an important factor affecting the quality of internal control of the Great Northern Wilderness. Secondly, internal control deficiencies directly led to stock prices decline of the Great Northern Wilderness, significantly reduced the profitability, growth and earnings quality. The results of this study contribute to the other companies in the same industry understand the critical factors affecting the quality of internal control for enterprises, improve certain reference significance to the quality of internal control.