Internal Control,Ownership Nature And Cost Stickiness

Cost stickiness refers to the characteristic that the expenses vary asymmetrically with the increase or decrease of income,that is,the cost of "easy to increase but hard to decrease".Cost-Volume-Profit Analysis model is based on the linear relationship between business volume and cost,that is,the rate of increase or decrease of cost is proportional to the increase or decrease of business volume.However,in the actual business activities,the relationship between the business volume and the expenses becomes more complicated due to the subjective decision-making by managers and the restraint of the objective system.That is to say,the changes of the costs appear "sticky" as the business volume changes.The concrete manifestation is that the reduction of the expenses formed when the business volume declines is smaller than the increase of the expenses when the business volume increases in equal amounts.Scholars have found that adjustment costs,optimism and pessimistic expectations of managers and agency problems are the main reasons contributing to cost stickiness.Excessive cost sticky makes the cost maintain a high level in a long time.It is not only a wasting of resources but also a negative effect of the operation and development of enterprises,so it is necessary to control the cost sticky within a certain range.Agency problem is one of the most important reasons leading to cost stickiness,and good internal control can effectively alleviate the agency problem.The effect of internal control directly affects the behavior of managers.An Incomplete internal control system of enterprises makes managers easily conduct self-interest behavior,which badly affects the cost of decision-making and accounting information quality.In addition,considering the nature of property rights,the internal management mechanism and the degree of perfection between the state-owned and non-state-owned enterprises in our country are quite different.Therefore,there are differences in the level of inhibition of the stickiness by the internal control.The research in this paper will help state-owned enterprises and non-state-owned enterprises improve their internal control system according to their actual conditions,control the level of expenses and realize the efficient allocation and utilization of resources.This paper first systematically analyzes the mechanism of the relationship between internal control and cost stickiness.On the basis of related theory,this paper takes the listed companies in Shanghai and Shenzhen A-share manufacturing industry from 2012 to 2016 as the empirical research sample and analyzes the restraint effect of internal control on cost stickiness,and draws the following four conclusions:(1)The problem of cost stickinessexists in the listed manufacturing companies in our country,and the different types of costs show different levels of stickiness,the stickiness of management costs is greater than the stickiness of sales expenses;(2)Internal control can effectively curb the cost of sticky;(3)There are differences in cost of sticky between state-owned enterprises and non-state-owned enterprises,state-owned enterprises cost stickiness is higher than non-state-owned enterprises;(4)Compared with the non-state-owned enterprises,the cost stickiness of state-owned enterprises is more serious and the effect of internal control quality on the cost stickiness is more significant.Finally,this article aims to provide advice on how to strengthen the construction of internal control and cost management.