Study On The Effect Of Governance Risk Capacity Of Private Listed Company On Internal Control Implementation

Internal control is conducive to preventing risks and realizing sustainable development of companies.The risk consciousness and risk capacity of corporate governance will affect the establishment and effective implementation of enterprise internal control.Although the influence of private listed companies on economic development has been expanding year by year,the operation and implementation of internal control of private listed companies is still lacking.The implementation effect of internal control of private listed companies improve in China,the quality of risk management of private listed companies will be improved correspondingly,which will promote the upgrading of the overall strategy,performance and value of private listed companies.The risk capacity of private listed company governance capacity include risk appetite and risk tolerance,risk appetite and risk tolerance size subjectly affect internal control environment,risk assessment,control activities,interal control information' communication and internal control information,further effect enterprise internal control execution effect,so the position of the governance risk capacity cann't be ignored.This article from the perspective of behavioral psychology research of private listed company governance is how to influence the effect of internal control execution,from the risk capacity of private listed company governance,salary gap,inspect of governance's risk capacity,governance risk compensation gap whether affect the enterprise internal control execution effect and how to impact,thus to improve the effect of internal control of the enterprise,the enterprise performance provides advice of the goverance layer's perspective.This paper firstly introduces the research background and significance,research content,methods,innovation and deficiencies.Secondly,it defines the concepts of private listed companies,governance layer,risk capacity of governance layer,and internal control execution effect,and expounds the behavioral psychology theory,risk preference theory and internal control effectiveness theory.Then,it studies the risk capacity level of private listed companies' governance layer and the internal control elements,and puts forward relevant assumptions regarding the risk capacity and internal control elements of the governance layer.Finally,an empirical study is conducted,and the analytical ideas of the empirical study are as follows: firstly,the measurement index of risk capacity of governance layer of private listed companies in gem from 2014 to 2017 is determined.The risk capacity of governance layer includes risk preference measured from the qualitative perspective and risk tolerance measured from the quantitative perspective.Secondly,data are selected for analysis.The selection of data is divided into two dimensions.The first dimension qualitatively measures a company's risk preference from the individual level of the governance layer,and quantitatively measures the company's risk tolerance from the corporate level.The second dimension selects the compensation gap of the governance layer from the qualitative perspective of the individual level in the first dimension.Finally,we selected DIB index as the substitute variable of internal control execution effect,and built a model through SPSS to analyze the relationship between risk capacity of governance layer and internal control execution effect,as well as the regulating effect of governance layer salary gap on the relationship between risk capacity of governance layer and internal control execution effect.Through empirical analysis,this paper draws three conclusions: first,there is a positive correlation between the compensation gap and the implementation effect of internal control;Second,the risk capacity of governance layer is negatively correlated with the implementation effect of internal control;Third,the governance layer compensation gap plays a regulatory role in the governance layer risk capacity on the implementation effect of enterprise internal control.The innovation of this paper lies in that the paper based on the theory of behavioral psychology,researches governance risk capacity of Chinese private listed firms,compensation gap on the effects of the internal control execution,how they affect and the reason,put forward the compensation gap and risk capacity affect internal control execution effect,the governance layer compensation gap plays a regulatory role in the governance layer risk capacity on the implementation effect of enterprise internal control.By exploring the research conclusions,Suggestions are put forward for the improvement of internal control execution effect of private listed companies from the perspective of risk capacity of governance layer and salary gap,so as to promote the strategic upgrading and enterprise value improvement of private listed companies.