Research On The Problems Of Internal Audit On The Electrolysis Project In LC Company

Project construction and technical transformation project has become a new force inboosting GDP with the rapid development of economy. In2013, the national fixed assetinvestment is4365280million yuan, Growth of19.6%over the same period. In2013, thenational GDP of China is5688450million yuan, the investment in fixed assets accountedfor76.7%of the GDP. But more and more problems have been found like low quality,high costs and other practical element. Therefore, the importance of internal audit forproject is obvious.In this paper, I select electrolysis project of LC as my research object. LC Companyis a large state-owned enterprise, with a total construction contract performance. Theconstruction process of LC has certain representativeness in China. The total contractcost of Electrolysis Project is17662thousand dollars. The cost profit rate is-7.92%andoperating profit rate is-6.22%. This Project management total losses1541505.45yuan.The data are given in good faith. We conduct an internal audit on this project has someimportant application value and practical significance.In this article, combining the qualitative analysis with the quantitative analysis andthe theoretical methods with practices, I study it by LC consideration of electrolysisproject.First,from the function and characteristics of the internal audit; this articleexpounds the internal audit of project. And then the status and characteristics of theinternal audit are introduced in detail. In the study, I found that the internal audit work ofLC Company is still fragile, there are lots of problems. In the third chapter, I discussedthe electrolysis project problems in the process of internal audit in detail. Such asauditors are too weak, lack of professional competency and independence, audit idea lagbehind, account foundation audit is still a fraud prevention and lack of engineeringsupervision and service function. The audit methods are too single and backward. Theproper auditing method also cannot be accurately used to complete the correspondingaudit work and lack of follow-up audit. For these problems, I did a lot of works, such as,communicated with the LC Company’s audit staff, reviewed audit working papers, read alot about project internal audit documents to find out the root causes of problems existingin the internal audit. The problems of auditors are caused by incomplete organizational structure. It seems like only by dredging the river, silt will not accumulate, the flood willnot overflow. The reason why audit idea fall behind is because that the company lacks theengineering quality risk management. The problems of audit method are caused by lackof internal audit basis. The reasons behind the point of intervention are the lack ofcomplete audit process. To solve these problems, some suggestions are made in the fifthchapter for the internal audit work of LC Company. For example, perfecting the internalaudit organization; Strengthen the risk oriented internal audit; rich internal audit methodof project; extend follow-up audit.In final, I summarize the whole article and list three conclusions. First of all, for theinternal audit of the project works smoothly, a scientific and rational structure of internalaudit organization is necessary. Secondly, the project audit mode should fully considervarious construction risk, in order to improve project quality and construction efficiency,combined with scientific and effective audit means to carry out audit work according toplan. Finally, follow-up audit is necessary for the project audit. The auditors should payattention to the design stage, the bidding process, project contract and construction phase,and so on.