The Correlation Study Between The Disclosure Of Internal Control And Capital Cost

With the implementation of the basic norms of enterprise internal control and corporate control supporting guidelines, relevant self evaluation report and audit report of internal control from the listing Corporation issued voluntary behaviour into a mandatory requirement, but the relevant internal control self-assessment report content disclosure and verification report also in the voluntary phase. This paper collected from 2009 to 2013 in Jiangsu Province Shenzhen motherboard listing Corporation data, by setting the variable, building model, and use the software to listed on the main board of Jiangsu Province, did the empirical analysis which was the correlation between the internal control of self evaluation report and verification report with the cost of capital.This study found that, with the time of this passage, more and more of Shanghai and Shenzhen motherboard listing Corporation in Jiangsu province disclosured the self evaluation report and report, and the report of the displayed content was more and more standard, but there are still many shortcomings. Although the requirements of relevant laws and regulations since 2012 in Shanghai and Shenzhen Main Board of listing Corporation must disclose at least 8 items, but the reality is that many enterprises are not in accordance with the provisions of the disclosure, especially for a range of internal control evaluation and program disclosure.At the same time, the empirical results show that:on a voluntary basis, self evaluation report a significant negative correlation between disclosure level and cost of equity capital of the enterprise’s internal control. However, under forced condition, the negative correlation between the two weakened. On a voluntary basis, there is a negative correlation between the enterprise’s internal control attestation report and the cost of equity capital. On a voluntary basis, there is a negative correlation between disclosure level of internal control and the cost of debt capital. In the forced condition, the negative correlation between the two weakened. On a voluntary basis, there is a significant negative correlation between the enterprise’s internal control attestation report and debt capital cost.