Research On The Key Links Of Internal Control In Chinese Shipping Enterprises

The economic globalization pressing ahead, Chinese shipping companies have been under sorts ofunprecedented pressures that come from political and economic fields when they compete againstinfluential multinational shipping companies. Especially after the global economic crisis in2008, theinternal and external environments in shipping industry become more complex and uncertain than they arepreviously. In order to blaze a new development path, which conform to their current conditions, Chineseshipping companies have to accelerate their pace, more operational risks following. As a result, a series ofscandals bred on these risks come into people’s horizon. Unfortunately, not only in shipping industry, butalso in other fields, economic crimes and financial frauds are exposed in each country, such as SONY’s andOLYPUS’s accounting fraud, and Sanlu Group’s milk scandal (which leads to its bankruptcy). According tostudies in recent years, the appearance of these scandals is closely linked to the leaks in enterprise internalcontrol. These leaks cause serious damage to almost every field in the economy. So, how to avoidenterprise operating risks and how to reinforce enterprise internal control are the top issues in Chineseeconomic development process.Chinese special economic development pattern has restrained the pullulate of enterprise internalcontrol in some degree. For that reason, Chinese entrepreneurs should introduce the advanced researchresults and successful experience from West. For example, the Committee of Sponsoring Organizations ofthe Treadway Commission (COSO), which is one of the most outstanding enterprise internal controltheories. This article is mainly focus on the COSO frame and its five main factors. By using case analysismethod, inductive method, and documentation method, and by combing theory and practice, this articlewill analyze the current situation and problems and the main key links in shipping industry in order toassess the failure of China shipping group, Fushan branch. The analysis of the failure of Fushan branch isthe main topic in this article. Additionally, Zhu Yingxue will induce and analyze the problems existed in theinternal control system of this branch with her own theoretical and practical knowledge. Finally, in theconclusion part, Zhu Yingxue will give some specific suggestions about how to improve the enterpriseinternal control system in China shipping group, Fushan branch. The first part of this article is about the background and significance of the main topics and the currentresearch status in the field of enterprise internal control. Furthermore, Zhu Yingxue will introduce herresearch strategy, research content, research method, and her own innovation. The second part mainlyexpounds the frame of enterprise internal control, defines the relevant concepts, and introduces the fivephases in the development of enterprise internal control theory. Additionally, Zhu Yingxue will use COSOas a example to help audiences visualize what is enterprise internal control system. This part can as afoundation to help you understand the following chapters. The third part will introduce the current situationand service features of internal control in shipping industry. By analyzing the current situation, ZhuYingxue will point out how to recognize and define the key links of enterprise internal control in shippingindustry. The fourth part introduces the basic information of China Shipping Group, Fushan Branch. Byanalyzing the financial fraud in this branch, this part points out the problems and leaks in its internal controlsystem, and gives corresponding suggestions. Finally, the last part summarizes the whole article and notethis article’s limitations as well as some related referable future researches.As a conclusion, Zhu Yingxue’s opinion is that enterprise managers should draw a clear distinctionbetween the primary and the secondary tasks, and should pay more attention to the control of key links inthe internal control process. Because of the specificity of shipping industry, this article will consider thekey links of internal control system in shipping company as a entry point, combining the theoretical basis.Finally, this article researches enterprise internal control in a innovative way.