The Research Of Factors Related To Internal Control Deficiencies For GEM Limited Companies

In recent years, with the promulgation of "Sarbanes-Oxley", people pay more attention to information disclosure of internal control. Regulatory authorities unveiled "basic norms of internal control" and "internal control Implementation Guidelines". It is necessary to require companies to disclose their internal control deficiencies. Internal control deficiencies have a significant impact on the effectiveness of internal control, so internal control information disclosure is worthy to be concerned. In addition, the GEM is an indispensable part of China’s capital market. So this paper researches on GEM listed company information disclosure of internal control deficiencies, it can help company to further strengthen internal normative defect information disclosure; it can help investors to make economic decision; it also can help regulators to develop more targeted information disclosure laws. In order to deepen the research level, we use empirical research methods, the study found that profitability, consistent with the independent directors of the workplace and the company location and audit quality and internal control deficiencies disclosure have significant positive correlation; while the Commission number and the Supervisory Board Meetings internal defect information disclosure are significantly negative correlation.This paper is divided into six parts:The first chapter is an introduction, highlighting the expected contribution and the lack of research background, significance and this article; Chapter Ⅱ is a literature review of relevant research literatures were reviewed and analyzed the current literature research, based on the significance of this study further proposed;Chapter Ⅲ of internal control deficiencies theoretical analysis of information disclosure, the first definition of internal control, internal control deficiencies, and then through the principal-agent theory, asymmetric information theory, signal transduction theory of information disclosure of internal control deficiencies theoretical basis for analysis; Chapter IV is GEM listed company information disclosure of internal control deficiencies situation, analyzes the main features of the GEM, and the disclosure of internal control deficiencies outlined the current situation in general, on the basis of further according to industry segments, COSO--2013integrated Framework, the five elements of internal control internal control deficiencies detailed descriptive analysis. Finally, according to these studies, summarized inadequacies GEM disclosure of internal control deficiencies exist, and to analyze the causes of internal control deficiencies disclose the status quo; Chapter V is the empirical part. According to the theoretical basis, the profitability of the six areas are the quality of the accounting firm, the number of meetings the Supervisory Board the independent directors of the workplace, the number of professional committees, ownership concentration, the author uses statistical software statal2.0to do empirical research; Chapter Six is conclusions and policy recommendations. According to inadequacies and descriptive analysis of empirical results, author makes constructive suggestions and analyzes the limitations of this article and future outlook.The main contribution of this paper is that the research is based on the voluntary disclosure of GEM listed companies, focusing on the disclosure of internal control deficiencies which are studied separately as a whole, focusing on companies to disclose internal control deficiencies; combining with the latest "Internal Control-Integrated Framework" and content analysis to build internal control deficiencies scoring system. The downside is that the number of companies listed on GEM only355(as of June2013), the voluntary disclosure of internal control deficiencies is not positive, resulting in insufficient sample size. Secondly, the factors affecting the disclosure of internal control deficiencies are complex, due to the limited energy and experience of the author, certain factors may not be taken into account.