The Impact Of Internal Control On Inefficiency Investment From The Perspective Of Ownership Structure

Investment is the linking bond between the financing and dividend in the area of financial management. The efficient investment decisions will bring more cash flow and increase enterprise value. In real life, however, due to error or intention deviation problems, severe inefficiency investment behavior is still very common. How to raise the efficiency of corporate investment and restrain the efficiency of investment behavior is a problem that deserves attention. In theory, high-quality internal control can inhibit inefficiency investment in some degree. But it remains to be testes if the expected economic consequences have been reached, besides, the equity structures in our country may have a certain influence on the governance role of the internal control.Firstly the paper elucidated and analyzed theories and literatures both at home and abroad about equity structure, internal control and inefficiency investment. Then this paper analyzed the specific cause of the inefficiency investment, the effect of internal control on the inefficiency investment and the influence of different ownership structures on internal control, and put forward the assumptions and empirical models. Secondly, the paper defined the concept and measurement methods of internal control, non-efficiency investment and ownership structure, choose the 2011-2014 Shanghai and Shenzhen manufacturing listed companies as research object. This paper studied the effect of internal control on the non-efficiency investment and regulation function of ownership structure on internal control, so as to improve the investment efficiency, perfect the internal control system, and provide the basis for improving the value of the company. In this paper, the main conclusions are as follows:Firstly, there still exists the phenomenon of non-efficiency investments among manufacturing listed companies in our country. In particular, the existence of investment shortage problem is more common, but the extent of the excessive investment is more serious. Secondly, the internal control can inhibit non-efficiency investments. Internal control can make the enterprise decision-making more scientific, and effective internal control can help to improve investment efficiency. Thirdly, from the nature of equity perspective, inhibition extent of internal control on the inefficiency investment is stronger in the non-state-owned holding companies, and in the state-owned holding company the extent is very weak. Fourthly, based on the perspective of equity concentration, inhibition extent of internal control on the inefficiency investment will decrease as the proportion of the first largest shareholder increase.In the end, based on the front theoretical and empirical exploration, puts forward some Suggestions from perfecting internal control system, optimizing equity structure, and provides a new direction for further research.