Study On SG&A Expense Internal Control In The Communications Equipment Industry

In the new situation of market economy fast developing, enterprises face how to adapt to the change of external environment, however the enterprise adaptability is mainly based on the coordination of internal parts, so the internal control system directly related to the enterprise survival and development in the environment which is full of crisis and risk. And internal control of SG&A is the core. Communications equipment industry is one of pillar industries of modern high-tech industry, with characteristics of high technical content, large capital investment, high innovation with high risk. So the internal control of SG&A is more important for communications equipment industry.This paper discusses the internal control about the origin, the domestic and foreign research trend, the definition and the latest theory, based on the theory of COSO internal framework, combined with the modern enterprise system requirement, and analyzes the current problems of SG&A expense internal control in the communications equipment industry, and give the solution which may make the establishment of SG&A expense internal control smoothly. Finally, taking the company W for example, the paper analyzes deeply the situation and problems of SG&A internal control, and put forward the detailed solution.This paper has six chapters,The first chapter is Introduction. Introduces the background and significance, literature review and innovation(This paper proposes that the company should make financial approval management regulations of R & D project and construct the R & D expenses allocation model)etc..The second chapter is SG&A internal control and the definition of related concepts and theoretical basis. The chapter makes the definition of SG&A, and based on the framework of internal control theory of COSO analyze SG&A internal framework theory.The third chapter is communication equipment industry’s current situation costs and problems of in China. From the eight elements of internal control system of COSO, analyze the problems in the enterprise culture, human resource policy, SG&A expense approval and budget, forecast and so on. For example, from the internal control environment analyze inadequate attention in communication equipment enterprises about SG&A expense internal control, from the internal control activities analyze SG&A expense approval procedures lacking in R & D project and the lack of R & D investment efficiency evaluation.The fourth chapter is measures to improve SG&A expense internal control of communication equipment industry in China. Put forward the corresponding solutions to the above part of the problem analysis.The fifth chapter is strengthening SG&A expense internal control application of communications equipment industry- a case study of company W. This part is the core of this paper. Take company W in which SG&A expense internal control is relatively perfect as an example, in-depth analysis of W problems in SG&A expense internal control, put forward the improvement suggestions and concrete scheme. Include the establishment of R & D project dimension financial approval system, construction of R & D expense allocation model and assessment of R & D investment efficiency.The sixth chapter is Summary.