Evaluation Index System Of Internal Control Of Listed Companies

At the beginning of21century, as a series of accounting frauds in company brokenout although the internal control system has been set up for a long time, theorists andpractitioners in the worldwide turn their attentions to the evaluation of internal control inthe same time. In2006, Shanghai and Shenzhen stock exchanges made the regulation thatcompanies listed in stock market must disclose the evaluation report of internal control. In2008, China’s Ministry of Finance joining hands with China Securities SupervisoryCommission, the Audit Commission, China Banking Regulatory Commission and ChinaInsurance Regulatory Commission officially released the《Basic Norms of Internal Control》and its supporting guidelines in2010, it requires that listed companies’ evaluation ofinternal control report must be audited by CPA and be disclosed with auditing report.Although it indicates that our internal control system has been basically completed, how topractice combined with external regulatory requirements, avoiding a slight move in onepart affecting the situation as a whole, is a major problem of the listed companies. Studieshave shown that the evaluation of internal control is still not perfect. The main reasons forthis phenomenon are the lack of evaluating index system because of lack of effectiveindexes of evaluation system, and《The guidelines for evaluation of internal control》is notfeasible. Therefore, the prospect of evaluation of internal control of listed companies in ourcountry is still not optimistic. In this case, the study of evaluating index system hasprofound theoretical and practical significance.At first, based on existing research achievements, the third chapter of this paperanalyzes the present situation and its reasons of the evaluation of internal control ofA-share listed companies of Shanghai and Shenzhen stock exchanges in the year of2011and2012in our country, and then this chapter describes these reasons as external andinternal reasons. The fourth chapter focuses on the evaluating index system of internalcontrol of listed companies in China. Firstly, for the principles, this paper proposes theconcept of the integration for the evaluation of internal control and risk management anddiscusses the path of integration from the macro and micro. Secondly, according to goals ofthe internal control, the author points out that the evaluating index system of internalcontrol should include three parts: results indexes of evaluation system based on internalcontrol targets, indexes of evaluation system in macro level of company, indexes ofevaluation system in micro level of company and selects quantitative indexes andqualitative indexes in each evaluation system. Lastly, this paper discusses the level of standard for internal control deficiencies. It divides the internal control deficiencies intotwo parts: the design deficiencies and operational deficiencies, and then identify theeffectiveness of internal control according to different internal control deficiencies level.Finally, this paper takes an example of SX Company, analyzes which index should beconsidered in the evaluation index system, and then introduces the method and process ofevaluation, which provides an available way for the evaluation index system consideringthe perspective of specific applications.