Study Of Financial Early Warning Model Based On Internal Control

With the development of global economic, enterprises are facing various risk which changes to a wider scope and a deeper level. This leads to a strong instability of the enterprise financial activities,so it is the key to construct the financial crisis early warning system to strengthen the financial management of enterprises.The paper aims to construct the financial crisis early warning system from internal control. After introducing the theory of financial crisis and financial early-warning and the combination of internal control and financial early warning, it put forward the research content. Also discussed the internal control and the framework of internal control, this paper is proposed the model of company financial crisis early-warning based on the internal control. The paper chooses 33 ST enterprises and 33 non-ST enterprises as the samples of the study in 2014 and 2015. It studies from the financial data of T-1 years. After a series of experiments, the financial crisis early warning model which based on internal control was successfully constructed.The results show that the financial crisis early-warning system has some ability to predict crisis while only containing financial indicators, with the continued addition of internal control effectiveness indicators, the accuracy of the financial crisis early warning system has been upgraded. Thus, the combination of internal control and enterprise financial crisis early warning will be more effective to the financial risk control of enterprises, and to promote enterprises in optimizing the internal structure,to improve their management level at the same time, to reduce all kinds of enterprise financial risk.