Research On The Influence Of The Corporate Governance To The Internal Control Defect

Due to financial fraud,companies are reported suffered huge losses even bankruptcy scandals in recent years frequently at home and abroad, such as the United States Enron event,Yinguangxia event and Olympus huge financial losses in the past two years, the occurrence of these events have exposed the enterprise without effective corporate governance and internal control work, lead to a significant defects in the internal control, leading to the occurrence of financial fraud. All countries in the form of legislation to deal with the occurrence of such events, enron, after the promulgation and implementation of the sarbanes-oxley, and our country also successively promulgated the "enterprise internal control basic norms" and "the form a complete set of enterprise internal control guidelines".Internal control defects has caused the attention of the scholars, in the aspect of internal control defects influencing factors have made some achievements, but for the influence of corporate governance on internal control defects also there are few scholars to study.This article studied on the internal control defects influence factors from five aspects of corpornance factors,including the characteristics of shareholders 、the characteristics of the board of directors、the characteristics of the board of supervisors 、the characteristics of managers and the characteristics of external governance.The sample selected is 2726 listed companies from 2011 to 2013 on the Shen zhen stock exchange and the Shang hai stock exchange.Through empirical test to research the corporate governance factors affecting the formation of the internal control defects,and introduce the intermediary variable the governance behavior to research internal control defects formation mechanism of deep.Through the empirical test, this article research results are as follows:First, The founds of research on the effects of corporate governance on internal control defects.Applies orderly Logistic regression test found that internal control defects of the company usually is not strictly follow the laws and regulations of the board of directors, without obtaining proportion pay a supervisor(supervisory board independence is low, the number of shareholders’ meeting is more, the executives shareholding ratio is Higher.in addition, listed companies hiring higher quality external audit institutions and hiring outside auditors to audit of internal control disclosure internal control defects more likely.Second,the founds of test the mediation effect of governance behavior.The empirical results show that the board of directors act in the board of directors characteristics impact on internal control defects produced during partial intermediary role.The main innovation of this article including: the first is the influence of the research on the internal corporate governance defects when considering the shareholder behavior and the characteristics of external governance, more comprehensively considering the influence of corporate governance factors on the internal control defects.The second,it is to take the assignment for grading method in this paper, the internal control defects, there are many types of defects of the company during the assignment for grading scores aggregation, make grading more scientific and reasonable.The third is the intermediary variable, this article introduced the governance behavior research in the board of directors governance behavior for the first time the mediation effect in the process of impact on the internal control defects.