Disclosing The Internal Control Deficiencies’ Influence Analysis On Investment Efficiency

In capital market, information is important for enterprises to make economic decisions,information asymmetry and inaccurate is a kind of phenomenon, which is widespread in thecapital market. In the case of information asymmetry and inaccurate, produce the inefficiencyinvestment is also inevitable. Foreign scholars’ research results show that the higher thequality of enterprise’s internal control, the better the quality of the accounting information willbe; some scholars also show that if the enterprise accounting information quality is higher, itis advantageous to the investment decision makers to make the right investment decisions.Internal control defects are refers to a firm’s internal environment, risk assessment, controlactivities, information and communication and internal supervision’s shortcomings andproblems. If companies disclose the internal control defects, internal control quality shouldneed to be improved, the accounting information quality is lower; it is likely to influenceinvestors’ investment decisions and cause investment efficiency lower. Therefore, based onthe disclosure of internal control defects, we discusses the efficiency of investment behavior,which guide the listed companies make the right investment decisions, it will have importantpractical significance.Combining with the specific situation of China’s listed companies in recent years, withthe principal-agent theory, asymmetric information theory and investment theory as theresearch basis, selection of China’s Shanghai and Shenzhen two city from2007to2012dataof a-share listed companies as samples, first of all, make a descriptive statistics analysis onour country listed company information disclosure of internal control defects and investmentefficiency under the premise that whether it is a financing constraints, found that:(1) themajority of listed companies in our country is in underinvestment;(2) the informationdisclosure of internal control defects on whether financing constraint condition has certaininfluence on our country’s investment efficiency;(3) the disclosure of internal control defects,inadequate internal control and internal control auditing imperfect proportion is larger; Then,using Logistic regression analysis the internal control defect information disclosure of listedcompanies and corporate investment efficiency of correlation and multiple regression, and italso shows the accuracy of the descriptive statistics; We found that:(1) the financingconstraints and investment behavior has obvious relevance, financing constraints company will tend to the lack of investment, No financing constraints company will tend to invest toomuch;(2) the disclosure of internal control defects affect the relationship between financingconstraints and investment efficiency, it also shows that the lag of the disclosure of internalcontrol defects can affect the investment efficiency and the effects of financing constraints;(3)if the disclosure of internal control general control and specific control impact on theinvestment behavior, it will cause the investment behavior’s differences. Finally, somesuggestions to these research conclusions.