Research On The Effect Of Corporate Governance On The Repair Of Internal Control Defects

In recent years,many companies at home and abroad have failed in business operations or financial fraud.The reasons are all related to the company's own internal control defects.Subsequently,a series of laws and regulations on internal control were successively introduced throughout the world,and the company's internal control was strictly regulated.Once the internal control defect occurs,in order to eliminate its negative impact and restore the trust of the report user to the financial report,the company will take measures to repair the defect of internal control as quickly as possible.At the same time,this measure will also improve the corporate governance and realize the company.objective requirements.With the promulgation of the SOX act,the issue of internal control has also received attention from the academic community.The integration of internal control and corporate governance has become a new research trend.The identification of internal control defects lacks scientific and consistent standards.Previous studies have focused on the factors that influence defect disclosure and are considered from the perspective of prevention.Few people engage in research from a later perspective.Therefore,they explore the defects of internal control.The definition and measurement of repair,and the post-doctoral perspective on how to repair internal control defects are innovations.This article reviews the classic literature related to major corporate governance and internal control deficiencies.Based on principal-agent theory,information asymmetry theory,and signal transmission theory,this paper sets the characteristics of board of directors,audit committee characteristics,and executive incentives to study companies.Effect of change of governance characteristics on the repair of internal control defects.Selecting samples with major internal control defects in 2012,from the perspective of internal control defects after exposure,study the effect of corporate governance changes on the repair of internal control defects in 2012-2016,based on structural equation modeling and other empirical research methods,using AMOS,SPSS,etc.The statistical analysis software evaluates the model using the absolute and relative fit index respectively,and performs a model correction according to the model evaluation results.The modified model is tested for significance against all the hypotheses proposed.Therefore,the following research findings have been obtained:1)In the characteristics of the board of directors,the size of the board of directors has no significant relationship with the repair of internal control defects.The independence of the board of directors has a significant impact on the repair of internal control defects.The split between the chairman and the general manager has a significant impact on the repair of internal control defects,indicating that the separation of the two positions limits the power of management and helps to strengthen the supervision of the management;2)In the characteristics of the audit committee,the audit committee There is no significant relationship between scale and professionalism and the repair of internal control defects;3)In terms of senior management,senior management changes and remuneration are positively related to the remediation of internal control defects.Changed management and good compensation incentive mechanisms can effectively prevent high The moral hazard of the management personnel.Finally,according to relevant conclusions drawn from empirical research,this paper starts from three aspects: the board of directors,the audit committee,and the senior management,and provides constructive suggestions for the company to improve the company's internal control defects through adjustments to the corporate governance structure,and points out that There are deficiencies in the article and future research directions.