Empirical Research On The Influence Of The Ownership Structure To The Internal Control Effectiveness

When the higher the level of internal controls effectiveness, the higher the quality of the company to disclose the internal controls information. At the same time also can enhance the information of outside investors, and management of the company development. From several aspects, therefore, to explore the effectiveness of internal control factors, for the improvement of the company’s internal control situation play an important significance. In addition, the core of corporate governance and ownership structure is the key. Because our country economic system is more special, whether state-owned enterprises or private enterprises, ownership structure is reasonable and perfect enough, it will cause some corporate governance problems. Therefore, this article chooses from two aspects of theory and practice to study the effect of ownership structure on internal control effectiveness. The study from the perspective of equity structure understanding and evaluation of internal control effectiveness, to managers and operators from the perspective of equity structure provides the suggestion to improve internal control effectiveness.The content of this article is divided to two parts in both theory and practice. About the theory, this paper expounds the meaning and classification of the ownership structure, and the meaning of internal control effectiveness and evaluation method. Secondly, this paper expounds the principal-agent theory and the theory of signal transmission. Finally, analyzes the impact of ownership structure in internal control effectiveness. Next, combine with the data analysis of the electric power industry in 2011-2014 China’s ownership structure and the current situation of internal control effectiveness. In the empirical part, this paper analyzes China’s Shanghai and Shenzhen A shares in 2011-2014, a total of 46 listed companies as the research object of the power industry. And then put forward four assumptions. At the same time, choose from degree to achieve the goal of internal control to measure the effectiveness of internal control. This article selects the effect of internal control objectives include operating efficiency, the reliability of financial reporting and legal compliance, at the same time set up three regression model, the empirical results are obtained.Aimed at the conclusion of the empirical analysis, this article put forward suggestions from two aspects of internal control and ownership structure. First, optimize the ownership structure. First, adjust the percentage of stock holding, and maintain the proper ownership concentration. And then, improve the inner supervision and decrease the percentage of state-owned shares. Second, strengthen the construction of internal control and understanding. Established the better rules and regulations, while improve the supervision about outside. This paper applies the method of combining normative research and empirical analysis, discusses the equity structure of listed companies in electric power industry impact on internal control effectiveness, and in view of the research conclusion puts forward some Suggestions of perfecting the internal control.This will help improve the effectiveness of internal control of the electric power industry and it will have a practical significance. And then, also hope this research can provide reference for such research in other fields.