Venture Capital,Internal Control Quality And IPO Performance Worsening Of Listed Companies

Venture capital is an important channel for the financing of small and mediumsized enterprises before listing,and venture capital plays an increasingly important role in China's capital market.At the same time,venture capital as a professional investor will also affect the corporate governance of enterprises,but because of the different interests of venture capital investment also caused their different investment motives,domestic and foreign scholars for venture capital in the company is to play a "certification supervision" or "grandstanding motivation" has not yet reached a consensus.In addition,there is little domestic literature from the perspective of venture capital participation in corporate governance and internal control interaction research how it impact on listed companies IPO performance.Therefore,the main concern of this article is: venture capital intervention(such as:higher proportion of VC share holding,participation in the governance of the board)will ease or worsen the performance of IPO? The problem that causes us to think further is that in the many mechanisms of governance venture capital,internal control has a special role and value as an important governance mechanism within the enterprise.Then the quality of internal control and how can the impact of risk investment behavior,and thus inhibit its IPO performance with the adverse effects of IPO performance,and truly play the value of venture capital value?Taking the IPO companies in SME from 2008 to 2014 and GEM from 2009 to2014 as the samples,this paper follows the classic VC management hypothesis to examine the impact of venture capital governance on the performance of IPO companies and the regulatory role of internal controls.The results indicate that there exist widely the phenomenon of IPO' s performance worsening in the companies with the participation of venture capital,the higher the degree of participation,the more serious the performance worsening.Further studies show that high quality internal control can weaken the negative impact of VC on the performance of IPO,the higher the degree of VC participation(higher proportion of VC share holding ?participation in the governance of the board),the more obvious the role will be.Thefindings suggest that the development of China' s VC system has not become mature yet;the behavior of VC presents obvious grandstanding motivation.Thus,the regulatory departments should further improve the risk investment system and strengthen the construction of the internal control system of listed companies,so as to achieve the goal of certification supervision over venture investment and creation of value increment.