On Internal Control Information Disclosure And Firm Stock Price Crash Risk

Principal agent problem and information asymmetry between management and external information users are important factors to form the risk of future stock price crash.High quality information disclosure of internal control helps to reduce stock price crash risk.It is of great theoretical and practical significance to study the correlation between information disclosure of internal control and stock price crash risk for perfecting the internal control system for company,protecting the legitimate rights and interests of investors and the healthy operation of the capital market.Since 2013,companies listed on Shanghai and Shenzhen motherboard have entered the stage of compulsory information disclosure of internal control.Most of the listed companies in China are in the process of establishing and perfecting the internal control system.They are subject to the mandatory requirements of external supervision and lack the initiative of internal control construction,which leads to the formality of internal control system and the generally low quality of internal control information disclosure.This paper studies the correlation between the information disclosure of internal control and stock price crash risk from the perspective of five elements of internal control by using literature analysis and empirical analysis.Firstly,on the basis of introducing the related theories of internal control information disclosure and stock price crash risk and combing the relevant literature,this paper uses information asymmetry theory,principal agent theory,signal transmission theory and risk perception theory to analyze the theoretical path of control environmental information disclosure,control activity information disclosure,information and communication information disclosure on the impact of stock price crash risk.The theoretical path of the impact of risk assessment information disclosure on the stock price crash risk,and the theoretical path of the impact of internal supervision information disclosure on the stock price crash risk.Secondly,based on the data of A share listed companies in China from 2010 to 2016,this paper empirically studies the correlation between risk assessment information disclosure and stock price crash risk,internal supervision information disclosure and stock price crash risk,and conducts robustness test and further analysis.Finally,it draws conclusions and puts forward policy recommendations.The results show that the regression coefficients of risk assessment information disclosure level and future stock price crash risk are significantly positive,the regressioncoefficients of internal supervision information disclosure level and future stock price crash risk are significantly negative,and the regression coefficients of controlling environmental information disclosure,controlling activity information disclosure,information and communication information disclosure and future stock price crash risk are not significant.The results show that the higher level of risk assessment information disclosure of Listed Companies in China significantly increases future stock price crash risk,the higher level of internal supervision information disclosure significantly inhibits future stock price crash risk,and the control of environmental information disclosure,control activities information disclosure,information and communication information disclosure has no significant impact on future stock price crash risk.These results are only significant when the company's performance is poor,corporate governance is poor and information quality is poor.In addition,the company size has no significant moderating effect on risk assessment information disclosure and future stock price crash risk.The negative correlation between internal supervision information disclosure and stock price crash risk is more significant when the company size is larger.The length of listing time and audit quality have significant moderating effects.The positive correlation between risk assessment information disclosure and future stock price crash risk,and the negative correlation between internal supervision information disclosure and future stock price crash risk are more significant when the company has a long listing time and poor audit quality.