Analysis Of The Influencing Factors Of Internal Control Deficiencies In Equipment Manufacturing Listed Companies

Equipment manufacturing industry is a strategic pillar industry of the national economy.It is an important guarantee for national economic security and national defense security,and has a special historical mission and strategic status.The internal control system of the industry has a direct impact on the resilience of China’s real economy.In view of the frequent problems of internal control defects in the listed companies of China’s equipment manufacturing industry,the author takes 213 listed companies of equipment manufacturing industry with defects in internal control as samples in A-share markets of Shanghai and Shenzhen from 2014 to 2016.Through the establishment of the structural equation model,the author makes an empirical study on the the influencing factors of internal control defects in the sample firms.The conclusions are as follows: first,the proportion of senior managers holding shares has a direct and significant impact on the formation of internal control defects of the equipment manufacturing listed companies.Second,diversification and market competition intensity have both direct and positive impact on the internal control defects of the equipment manufacturing listed companies,and have an indirect and positive impact.The indirect effect is passed through two variables such as cash dividend and financial pressure.Third,the size of the company,stock backlog and ownership concentration have both direct and positive impact on the formation of the internal control defects of the equipment manufacturing listed companies,with indirect and significant influence,in which the indirect effect is passed through the two variables of debt scale and financial pressure successively;fourth,Internal control defects have a significant positive impact on operational risk and financial risk.According to the above conclusions,the author puts forward five preventive suggestions:avoiding excessive diversification;improving the core competitiveness;formulating a reasonable balance between capacity and demand;adjusting the executive incentive plan in a timely manner;optimizing the capital structure continuously.The author hopes that this study can provide theoretical reference and case reference for the listed companies of the equipment manufacturing industry to prevent the risk of internal control defects and improve the internal control system.