The Research On The Influence Of Product Market Competition To Internal Control Auditor Choice

The reform and open up becomes the premise of the appearance of Chinese private enterprises.With more than 30 years of institutional transformation,Chinese private enterprises not only become the engine of economic development,but also effectively push China historical course of political and social.China has begun to build standard system of internal control since 2008.Under the background of partial implement of internal control auditing,all the main-board listed companies has been forced to implement internal control auditing since 2015.However,most Chinese private companies,except for the main-board companies,have still voluntarily implemented internal control auditing.Therefore,internal control auditing,will become the sally port.The market always plays the key role of Chinese private companies' survival and development.Meanwhile,the Product market competition deeply influences the behavior of Chinese private enterprises.Accordingly,under the new normal state,whether different level of product market competition excert different governance effect,whether the market mechanism play the role of resources allocation in internal control auditing,and how to coordinate the role of government and market in the course become an issue worthy of further research.Based on the Evidence from 2010-2013 Chinese listed private companies,we analyses the relationship between firm and industry level of product market competition and Choice of internal control auditor.The results show that:(1)There are positive relationship between product market competition,internal control auditor and high quality internal control auditor.(2)There are negative relationship between Industry competition and internal control auditor,while it is uncorrelated with high quality internal control auditor.At present,product market competition adversely affect Chinese Listed Private Companies' internal control auditor choice,their choice are out of peer pressure motivation.Therefore,Chinese listed private companies should promote competitiveness.Meanwhile,government should guide high quality demand of internal control auditor,strengthen legal duty of auditor,and improve professional manager market,providing sound institutional environment for the development of internal control standard system.The results provide helpfully micro evidences and policy references for building and improving internal control standard system of Chinese Listed Private Companies.