Research On The Relativity Between Internal Control Effectiveness And Enterprise Performance

Recent years many companies performance suffered heavy loss due to short of effectiveness about the internal control. This expose the serious deficiencies in internal control for Chinese companies. Although the state promulgated a series of laws and regulations to standard the internal control, the internal control is not caused by enterprise managers serious enough due to the internal control development late in our country. In this paper, we study the relativity between the internal control effectiveness and enterprise performance in order to raise concern about company internal control and ensure the healthy development of companies.In the paper, from two aspects of internal control effectiveness and business performance established the corresponding the indicators of body measure of the internal control effectiveness and business performance. Five elements of internal control as a whole and set up index respectively to establish a measuring system. Enterprise performance is given priority to with weighted average net assets indicators and combined with profitability and operating capacity index. By setting up multiple linear regression model and using the SPSS 19.0 respectively from the overall effective internal control and the five elements of internal control, empirical research on its relevance with corporate performance. The research results show the five elements of internal control overall effectiveness and are significant positive correlation with corporate performance, if enterprises want to get a higher performance, should improve the level of internal control effectiveness.