An Empirical Study On The Impact Of Internal Control Quality On Trade Credit Financing

As an important part of China's national economy,small and medium-sized board companies play an irreplaceable role in China's economic development,social full employment,ease the pressure of employment,to maintain social stability.However,due to the limitations of small and medium-sized board listed companies and the constraints of China's financing system,small and medium-sized listed companies are still facing financing constraints.The trade credit financing as a substitute for bank credit mechanism can ease the financing difficulties of small and medium-sized listed companies in a certain extent.In the framework of signal transmission theory,internal control and external financial environment contribute to the information transmission between enterprises,play an important role on the trade credit financing.Therefore,this paper takes a total of 1241 small and medium-sized listed companies as research samples from 2010 to 2015,and studies its impact on trade credit financing from three aspects: internal control,financial development and property rights,and discusses the way of the trade credit financing of small and medium-sized listed companies from the perspective of internal control.Firstly this paper based on the theoretical basis and domestic and foreign research results,to determine the content and framework.Then,based on the theoretical basis,combining with the characteristics of enterprise development,internal control and trade credit financing,this paper puts forward the hypothesis of this paper from three aspects: internal control,financial development and property right.By constructing the multiple regression model,this paper studies the influence of the internal control quality of small and medium-sized listed companies on trade credit financing.First,the descriptive statistics of each variable are carried out.Based on this,the correlation analysis of the data is carried out to determine whether there is multiple collinearity between the independent variables.The results show that the correlation coefficient between the variables is small within range.Then through the construction of multiple regression model for internal control of commercial credit financing for further empirical analysis.The empirical results showed that,(1)high-quality internal control enterprises were easy to obtain more trade credit financing.(2)the level of financial development in the area where small and medium-sized listed companies are located was significantly positively correlated with the level of trade credit financing.The impact of internal control quality on commercial credit financing was more pronounced in enterprises with lower levels of financial development than those with higher levels of financial development.(3)Compared with state-owned enterprises and non-state-owned enterprises,non-state-owned enterprises were more difficult to obtain commercial credit financing.And the impact of the internal control quality of non-state-owned enterprises on commercial credit financing was more significant than that of state-owned enterprises.Finally,according to the results of empirical research,Enterprises should strengthen the construction of internal control,enhance the use of commercial credit financing awareness.The government should promote regional financial development,enhance the level of financial development and reduce the intervention to the market economy.