Research On Internal Control Of ZM Company Procurement

In the early 21st century, with the rapid development of our national economy,more and more energy are needed.The increasing demand for energy leads to the coal price rising rapidly. Coal industry also have an unprecedented development. In the second half of 2012, the coal supply is far greater than the market demand, which causes the price of coal have an sharp decline and the profits of coal companies drop greatly. Therefore it is very urgent for coal industry to restructure.After 2015, along with the further exaltation of the request of nation for the environmental protection and the implementation of the policy about cutting capacity, the price of coal continued to decline and the coal industry remained depressed. Coal industry enterprises face a more difficult business environment. In the face of such external environment, enterprises need to adjust the business structure and enhance the capacity of production, improve production efficiency and change the original management idea.ZM company is a traditional large-scale coal enterprise. with the reform and integration of the coal industry, the construction of internal control of ZM company has experienced a series of process,including the preliminary design,adaptive adjustment, optimizing, and continuous improvement. In the process of the production and operation , procurement is the beginning of the enterprise production,and it is also the beginning of business activities. Due to the characteristics of procurement,the high risk of procurement mainly reflects in: enterprise procurement business is not set properly authorization of approval which leads to the waste of purchase business; the acceptance check for the purchases of raw materials is not normative that leads to the defects of material quality; in the process of purchasing,personal mistake,fraud or deception bring about the loss of enterprise assets, and so forth. Therefore, in the process of enterprise management, procurement is important but difficult, and it is also the core of the construction of enterprise internal control.This paper analyzes the current procurement of ZM company, and finds the existing problems of ZM company procurement. This passage makes a deep analysis on the existing problems and finds the causes. Based on the domestic and foreign mature relevant theories about internal control andthe success experience of all industries, aiming at the practical situation of ZM corporations,the improvement measures were proposed. Meanwhile, this paper makes a further improvement for ZM company's existing dynamic adjustment system of internal control.This paper mainly constituted by the four parts: The first part, introduction.Mainly elaborates the backgrounds, the purpose, the significance and methods of the study.Second,the case description. At first,ZM company's background and its implementation of internal control on purchasing business are introduced in detail.Then,this part through three cases analyzes the actuality of the internal control of ZM company about procurement business. Based on the theories about internal control find the existing problems of the ZM company's internal control of procurement.The third part is case analysis. First,it discusses the basic theory of internal control, and analyzes the theory of supply chain and risk management. Then, based on the theory of internal control in the second part, this part discusses the reason further. The fourth part, conclusions and suggestions. Based on the cause of problems of ZM company procurement business, the article together with the present situation of internal control of purchasing business, puts forward improved measures, and improves the internal control of ZM company's procurement. The end of the paper makes a conclusion. For ZM company's existing problems about internal control of purchasing business, this part puts forward improved specific measures, perfects all critical links about internal control of purchasing business and draws a final conclusion.