Ownership Structure And Effectiveness Of Internal Control

The internal control system has experienced a long process of development since its inception,Stakeholders recognize the importance of internal control as a result of the Enron incident,studies on the effectiveness of internal control have emerged.Ownership structure as the basis for the establishment and development of the company,it can determine the arrangements of internal control.Ownership structure is the representative of the interests of shareholders,internal control system is a tool to protect the interests of shareholders,the relationship between the two is quite rich.However,there are different conclusions about the effect of the two factors.When the enterprise is in different life cycle,it will make a corresponding adjustment of ownership structure,the ability of shareholders to influence the company is also different.In each life cycle,there is a clear gap between enterprises' willingness and ability to build internal control system.This gap will be reflected in the degree of effectiveness of internal control.Based on this background,this paper introduces the enterprise life cycle to discuss the effect of ownership structure on the effectiveness of internal control under different life cycle.In this paper,A-share listed companies from 2012 to 2014 are taken as research samples,and the validity of internal control is taken as explanatory variable and the degree of ownership concentration as the explanatory variable,and analyzed the relationship between them in each life cycle.According to the different nature of the controlling right,the company will be divided into state-owned holding and legal person holding,analysis of the nature of the controlling role in the life cycle of the regulatory role.The regression results show that the concentration of ownership can enhance the degree of effectiveness of internal control in start-up companies.In the period of growth and recession,the concentration of ownership does not have a significant effect on the effectiveness of internal control.When the enterprises enter recession,The more concentrated,the more effective internal control.After the addition of the nature of controlling interest,the study shows that the state-owned holdings can promote the positive correlation between the concentration of ownership and the effectiveness of internal control in the start-up companies;In the recession period,the regulation effect of the state-owned holding is not significant.The paper is divided into six chapters: The first chapter is the introduction,which includes the general framework of the article describes the background and significance of this paper,this paper presents the innovation;The second chapter is literature review,which describes the research status of internal control,summarizes and reviews the research on enterprise life cycle,ownership structure and internal control according to the related literature;The third chapter is the theoretical basis and logical deduction,summarizes the characteristics of listed companies in each life cycle based on the existing theoretical basis,and deduces the influence mechanism of ownership structure on internal control in each life cycle and puts forward relevant hypotheses;The fourth chapter is research design,including the selection and selection criteria of the samples,and the corresponding models to test the hypothesis;The fifth chapter is empirical analysis,which will describe the samples and analyze the characteristics of each variable under different life cycle,and then the correlation test,the regression analysis and the robustness test;Chapter 6 summarizes the conclusions,revelation and prospects of this paper,which summarizes the research conclusions and make recommendations,indicating that the shortcomings of this study provides a direction for future research.The research of this paper enriches the internal control to a certain extent,revealing the different influence of ownership concentration on internal control under different life cycle,which provides some explanations for the conclusion that the relationship between them is completely different.Revealing the regulatory role of the nature of controlling stock in the relationship between the two life cycles.The conclusion of this paper reminds the listed companies to consider their own life cycle when examining their own ownership structure,and also provides some reference for the relevant departments to formulate the relevant provisions of internal control.