Study On Legal Regulation Of Listed Companies Internal Control In China

As internal control provisions of the law, it is still blank in our country. However,the importance of internal control has a full range of highlights out, with perfectinternal controls and accurate information, investors can get the business information,operating conditions, financial situation they need,, and decide whether to continueto invest. While,this is also making the situation of information asymmetry betweenbusiness owners and managers significantly, so that the full range of business ownerscan get the information. In terms of legal regulation of internal control, the UnitedStates is an example worth studying." Sarbanes-Oxley Act " is an important act in2000and2002Enron, WorldCom and other listed companies have a financial scandalbroke, it is published for the listed companies to strengthen internal controls andenhance confidence in the capital market and the introduction of an important law.The bill in terms of form or content, is the basis of " U.S. Securities Act of1933" and"1934U.S. Securities Act", according to the real needs of development and thesecurities markets, corporate governance, internal control and accounting andauditing new adjustments and specifications of. When President Bush signed the bill,he said," It is a milestone in the development process in the U.S. stock market." Thebill has the provisions of Chapter111107, re-regulate the U.S. stock market, and itwant to try to restore public confidence in the U.S. stock market. Through theenactment of the bill, and combined with the existing legal system, the United Statesestablished a sound legal system of internal control.It is in the early1990s that our country began the study of internal control, butmostly for the study of the theory of internal control, a U.S. public company after theintroduction of Sarbanes-Oxley Act and the consequent impact on the market reaction, did not do too much research, internal control aspects of legal regulation,mostly for the Ministry of Finance, People’s Bank of China and other ministries todevelop the specification level units, institutional aspects of construction is laggingbehind, most enterprises still remain understanding of internal controls in theaccounting field, problematic. The solution to these problems, or can learn theoutcome of the U.S. Sarbanes-Oxley Act.The main purpose of this paper is to study in depth an internal control theory aswell as U.S. legislation in internal controls, as well as find differences between thetwo countries in terms of the legal system of internal control, and find out measuresin favor of the legal construction of internal control. The ultimate aim of all this is tostandardize the behavior of listed companies, the strict regulatory capital securitiesmarket, to ensure open and transparent markets, to protect the fundamental interestsof the investing public.