Research On The Impact Of Listed Companies' Internal Control Quality On Debt Financing Constraints

Ensuring the integrity and smoothness of the capital chain in the production and operation of enterprises is the key that cannot be ignored.The shortage of funds is one of the key problems facing the enterprise,which restricts its forward development.At present,the domestic financial market environment and conditions are not mature enough to meet the needs of equity financing at different levels.Therefore,debt financing has become an important way for most domestic enterprises,especially small and mediumsized enterprises,to obtain financial support.However,the capital market is facing the unreasonable phenomenon on debt financing,such as being difficult and expensive on financing,which have brought trouble to many enterprises.Internal control can monitor and guarantee the production of corporate information,ensure the financial performance and business management capabilities of the enterprise.In addition,the improvement of the quality of internal control can also eliminate the hidden danger of information asymmetry between the enterprise and creditors,so that it can have a certain easing effect on corporate debt financing constraints.In addition,related policies and regulations issued in China have also provided a deeper protection for enterprises to enhance their awareness of improving the quality of internal control.Information is the bridge connecting financing companies and creditors,and trust is the key to ensuring that information works.At present,information asymmetry,insufficiency,and social uncertainty are the basic reasons for trust establishment.However,due to the establishment of the trust mechanism,the cost of information disconnection during the transaction between the two parties accompanied by the asymmetry of information has been gradually reduced,and internal control has also played a vital role,the two form an invisible guarantee.The improvement of the quality of internal control and the existence of trust can alleviate corporate debt financing constraints,but further research found that under different levels of trust mechanisms,the impact of internal control on debt financing constraints is not the same.Therefore,exploring the relationship between the two has become the focus of this article.This article first summarizes the influencing factors of corporate debt financing through the collation of relevant domestic and foreign literature,and also sorts out related literature on the quality of internal control,trust,and their impact on debt financing constraints.Then put forward the theoretical basis of the article,the information asymmetry theory,the signal transmission theory,and the incomplete contract theory,to support the hypothesis of the article,and measure institutional trust by the nature of property rights,measure credible trust by analysts focus,measure characteristic trust by market position.Finally,use an empirical analysis method,based on the 2013-2018 data of China's A-share listed companies,through descriptive statistics,correlation analysis,group testing,multiple regression analysis,and robustness testing,to explore the impact of internal control quality on debt financing constraints,and based on three different types of trust perspectives: credible trust,characteristic trust,and institutional trust,further explore the role of different levels of trust in the impact of internal control quality on debt financing constraints.The research results show that the higher the quality of internal control,the longer the debt financing maturity level,the lower the financing cost,and the larger the new loan size,that is,the looser the debt financing constraints;compared with the more trusted companies,the quality of corporate internal control with weaker trust has a more significant impact on debt financing constraints,that is,the quality of internal control and trust have a substitution effect in alleviating debt financing constraints.Besides,combined with macroeconomic conditions,this article further explains the reasons for the relevant results,and put forward corresponding theoretical references and suggestions for improvement.