The Internal Control, Related Party Transactions And The Efficiency Of Investment

In recent years, along with the accelerating the pace of reform and opening up, In recent years, along with the accelerating the pace of reform and opening up, the speed of economic development in China is also in constant rise. However, the rapid economic development will not avoid trigger a series of problems, including the efficiency of investment problem is particularly acute. As a result, the efficiency of investment is also the attention of many scholars. Theory study found over the years due to early has been focused on the speed of economic development in our country, no overall consideration, which leads to the low investment in our country output ratio, excess capacity and so on the efficiency of investment. At the same time, the domestic and foreign scholars study found that the cause for the efficiency of investment is the affiliated party transactions, corporate governance, audit supervision and other factors. Theory for corporate governance, audit supervision, equity incentive of already very mature, but for the affiliated party transactions caused by inefficient investment research is relatively scarce, and in the process of internal control system construction in China, the relevant provisions of the related party transactions is in constant perfect, so this article is based on internal control, to study the relationship between the related party transactions and the efficiency of investment. The empirical results show that the same situation in other conditions, the output type of the affiliated party, will increase the efficiency of investment; The discretion of the listed company internal control effectiveness has obvious inhibitory effect to the related party transactions, and is a significant negative correlation relationship; The same situation in other conditions, the internal control can effectively reduce the output type of related party transactions impact on investment efficiency. The higher the quality of internal control of enterprise, the higher the company’s accounting information transparency, between controlling shareholders and subsidiary increasingly unable to damage the interests of the enterprise black-box operation, finally effectively restrain the illegal related-party transactions occur. The affiliated party transactions itself is a neutral, between related parties can thus to reduce the transaction costs, improve the efficiency of investment, and so on, but in China, the special economic environment related party transactions are often malicious operation, eventually produce the investment efficiency of resource waste. Can through the high quality of the internal control of listed companies to curb the affiliated party transactions of the investment efficiency. The internal control of related party transactions and investor protection have good conduction effect, internal control can effectively curb illegal related-party transactions, and to reduce the effect of the investment efficiency.Based on the internal control, related party transactions and the efficiency of investment from three aspects, is divided into five parts altogether. The first part is the introduction, elaborated this article research significance, research ideas and research methods, and reviews the internal control, related party transactions and the efficiency of investment of various types of related literature. Second part as the theoretical basis for this paper, to study the evolution of the concept, classification, adequately defined, and from the efficient market theory, principal-agent theory, the theory of asymmetric information on internal control, related party transactions and the relationship between the efficiency of investment has carried on the comprehensive interpretation. The third part is mainly to the internal control, related party transactions and the efficiency of investment, three factors are the theoretical analysis and the hypothesized, the efficiency of investment in our country the status quo analysis of the status quo, demonstrates the efficiency of internal control, related party transactions and investment mechanism, and on this basis, put forward in this paper, the research hypothesis. The fourth part is the empirical study, this paper chose the Shanghai and shenzhen two city stock exchange listed companies in 2011-2014 as the research sample of 6476 observations, the use of Logistics and Panel regression two methods of regression analysis, in this article about internal control, related party transactions and the research hypothesis is tested empirically the efficiency of investment. The fifth part is based on the fourth part of research results, gives the research conclusion and put forward policy Suggestions. the study found that:(1) the output type of related party transactions and the efficiency of investment is significantly related to the description as "mother" company of the listed company is in the interests of the various aspects to consider, will appear in the listed subsidiary the condition such as the credit crunch, the controlling shareholders through the subsidiary company on the affiliated party transactions such as loan guarantees to adjust, the results of this kind of behavior is the investment efficiency of listed companies themselves. (2) of the listed company internal control effectiveness of the output type of related party transactions have obvious inhibitory effect, and is a significant negative correlation relationship, shows that the higher the quality of internal control of enterprise, the higher the company’s accounting information transparency, between controlling shareholders and subsidiary increasingly unable to damage the interests of the enterprise black-box operation, finally effectively restrain the output type of related party transactions. (3) of the listed company can through the high quality of internal control to suppress the output type square deal to bring the efficiency of investment. Internal control of related party transactions and the efficiency of investment has very good conduction effect, can suppress the output through effective internal control type of related party transactions, and to reduce the effect of the investment efficiency.