Research On The Status Quo And Improvement Of The Internal Control System Of The AD Bank

In recent years,the global market economy has been affected to varying degrees with the impact of the international financial crisis and the frequent outbreaks of major banking cases at home and abroad.Therefore,it is crucial to improve the internal control level of banks to maintain the steady development of the national financial system.As everyone knows that AD Bank is the only agricultural policy bank in China and an important part of the national financial system.It undertakes the agricultural policy finance services as stipulated by the state,allocates the funds for the financial support of agriculture and strives for the development of the national agriculture,rural areas and farmers business.However,AD Bank has low level of risk prevention due to the backwardness of its operation management,information technology and hardware equipment and so on.With the continuous deepening of financial system reform and the continuous expansion of business,the risks and problems in the process of operation have been gradually exposed.Therefore,it is imperative to study and improve the internal control system of the bank,improve its internal control level and effectively prevent the relevant risks.Firstly,it discussed the research background,significance,methods,ideas and literature review in this paper.The literature review mainly involves the theory of corporate internal control and the relevant theories of the internal control of banks.Secondly,it introduced the related concepts,characteristics,principles of internal control,objectives and basic approach of implementation of the policy banks.Thirdly,it briefly introduced the development process of AD Bank.Fourthly,it analyzed the current situation and existing problems of the internal control of AD Bank from five elements of internal control,including internal control environment,risk identification and assessment control activities,information and communication,and internal supervision.Moreover,the causes of the problems were analyzed from the theoretical and practical level,finding that there were many important reasons for the weak internal control of AD Bank,such as the lack of legal basis in policy banks,exceed administrative management,irrational management system,shortage of talents,backward information technology level and lack of independence of internal audit department,etc.Finally,according to the reasons after the analysis,the appropriate methods were adopted and the suggestions for improving the internal control system of AD Bank were proposed from the following five aspects.First of all,from a macroperspective,the state shall draft and formulate the special policy bank laws and the legislature should customize the corresponding legal system for AD Bank,so as to better promote the reform of the policy bank financial system and ensure the high efficiency and professional operation principle of policy bank in legal form.Second,improve the internal control environment,eliminate the administrative management,learn from the successful experience of China Development Bank to improve the corporate management mechanism;strengthen the construction of internal control culture,so that the good internal control culture atmosphere can be transmitted to every department,every employee and every working link;improve the human resources management system and establish a scientific human resource policy,so as to guide employees to better implement the internal control system.Third,the modern technology means and models,analysis methods shall be used to improve the risk identification and evaluation system,optimize the setting of risk management departments,introduce the professional talents to enrich the risk assessment team,thus establishing a professional risk identification and assessment team.Fourth,through the improvement of the internal control system,formulate an understandable and operational control activity system to improve the overall execution.Meanwhile,proceed from strategic management to formulate a clear medium-and long-term strategy and prepare a scientific and reasonable budget,so as to achieve the business planning and adjustment of the whole bank,and establish effective internal control activity.Fifth,vigorously develop the information technology.At present,the information technology of AD Bank is the most backward,at least 10 years behind compared with other commercial banks.Therefore,it can improve the technical and management level from the introduction of information technology talents and the development of advanced systems and software,etc.Sixth,through the clarification of the duties and status of internal audit department,expand the internal audit field and integrate the external supervision systems to form a comprehensive internal and external supervision system.In this paper,it is innovative to propose that “the state shall formulate special policy bank law” to make its operation have rules to follow,so as to promote the improvement of internal control system,which is also the international practice of legal regulation of policy banks.In addition,it is proposed to learn the advanced experience of China Development Bank,cancel the administrative management and improve the corporate management mechanism,etc.It is of great significance to promote theimprovement of the risk prevention and operation management level of AD Bank,and promote its steady development through the improvement of the overall environment of the internal control.