Internal Control Deficiency Disclosure And Management Corruption

As one of the important way of modern corporate governance,internal control system plays an important role in inhibition of management corruption.It has been six years since our country require listed firms disclose internal control self assessment report and audit report.Time span and the amount of data has allowed to research on the quality of internal control information disclosure.How about the quality of internal control information disclosure? May it be feasible to track management corruption through the major defects of internal control disclosure,make it become an important early warning mechanism of management corruption.These questions yet need for testing.Using a sample of Chinese listed firms over the period 2012—2015,we verified the relationship between internal control deficiency disclosure and management corruption to verify the quality of internal control deficiency disclosure.The empirical results show that: the relationship between internal control deficiency disclosure and management corruption can be significant as we use internal control index.It will not be significant if we use the internal control self assessment report and audit report from listed firms.It means that the internal control plays a positive role in preventing management corruption while the deficiency disclosure plays no role.