Research On Financial Risk Of Hebei Constuction Engineering Group From The Perspective Of Internal Control

The competition in construction industry has been intensified in the past dozen years due to the development of society and the improvement of socialist market economy system in China.Recent years,the competition became alleviated and rational,but as one of the important pillars of China's economy and a typical representative of capital-intensive industry,due to historical reasons,many financial staffs in construction companies are unprofessional and lack of the awareness of financial risk,leading to financial crises and even bankruptcy in many companies.The research of financial risk in China started late,even it has developed rapidly,but there is still little research of financial risk in construction industry.Therefore,this author selects Hebei Construction Engineering Group as the research object in this paper,through the learning of literatures and consulting the research results of other outstanding scholars in the world,analyses this enterprise's financial risk.Besides,a set of specific and targeted financial risk prevention programs are designed to solve the practical problems facing the group on the basis of it's real situation.First of all,this article explains the concept,characteristics and classification of financial risk based on the existing research.Three financial risk identification methods are described,such as Delphi method and financial statement identification method.The definition of internal control and the role of the five elements of internal control in preventing financial risks are also introduced.Secondly,this article adopts the case analysis method.First describes the basic situation and organizational framework of Hebei Construction Engineering Group in detail.Then using Z-Score model to comprehensively evaluate its financial risks,and identify the financial risks existing in the financing,investment,and operation of the company.Finally,field surveys and questionnaires were used to find out the shortcomings of the company's internal control,and to dig deep into the causes of these problems.Then,specific measures were put forward for the aspects of internal control environment,risk assessment,process control,information and feedback,and internalsupervision.A specific plan of financial risk prevention and control for Hebei Construction Engineering Group were designed.At last,the author proposes several specific safeguard measures from different perspectives in order to ensure the designed financial risk prevention and control scheme can be implemented successfully.Hopefully this case study could help the financial risk prevention and control of construction enterprises in China and benefit the healthy development of similar enterprises.