Study On The Moderating Effect Of Internal Control Quality On Venture Capital And Enterprise Performance

Under the new normal of China's economy,a large number of innovative and high-tech enterprises have sprung up in the capital market,and venture capital has also become more active as a high-tech business incubator in the capital market.Many literature studies have shown that venture capital can provide "certified supervision" and "value-added" functions for invested companies.There are also many literatures confirming that the companies who has venture capital backed will perform better on performance.And good internal control can not only ensure information quality and asset security,make all internal links of the company coordinate and check each other,but also improve corporate performance.The role of venture capital and internal control in improving corporate performance has been generally separately recognized,but there are few literatures that combine venture capital and internal control to discuss its impact on corporate performance.Since 2014-2018,GEM has listed a total of 799 companies,of which 693 companies are supported by venture capital,accounting for 86.73% of the total.There are enough samples to explore the impact of venture capital and internal control on corporate performance.Based on the literature review,this paper combines the resource-based view founding gap theory,principal-agent theory,signalling theory,and selects the business performance of GEM enterprises as the research object,through the Wald test,Ar2 test,Sargan test to verify that the established multiple regression model has a good fit,the empirical discussion of the impact of venture capital and internal control on corporate performance.First,considering that after venture capital injects companies,there may be a lagging reflection on the impact on corporate performance.The corporate performance is divided into one-lag corporate performance and corporate performance fluctuations(The standard deviation of performance by t-1,t,t + 1 for a total of 3 years.)two parts,respectively discuss the impact of risk capital on them;secondly,introduce the quality of internal control as a regulatory variable,study whether internal control can moderate the impact of risk capital on corporate performance;finally,the internal control is divided into Indicators(Strategic Target Index,Business Target Index,Report Reliability Index,Legal Compliance Index,and Asset Security Index)are used as moderators,and in-depth study of their moderating effects on venture capital and corporate performance.The research conclusions of this paper show that while venture capital helps improve corporate performance,it also increases corporate performance fluctuations.When the quality of internal control is used as a moderating variable,it can promote the positive impact of venture capital on corporate performance and mitigate the impact of venture capital on corporate performance.Specifically,the moderating effect of internal control quality is reflected in three aspects: strategic level indicators,management level indicators and report reliability indicators.Based on the above research conclusions,the following policy implications are drawn:(1)For venture capital institutions,attention should be paid to post-investment on-site management,using their rich management knowledge and financial knowledge to provide corresponding auxiliary services for invested companies,and give full play to certification supervision function,properly intervene in business management,maintain corporate financial stability,and promote the improvement of corporate performance;(2)For invested companies,the overall concept of internal control should be strengthened,starting from the corporate strategic objectives,focusing on coordination and building the correlation between different elements mechanism,rationally improve the degree of assurance provided by internal control for the completion of corporate goals,improve the management efficiency and operating efficiency of the enterprise,and steadily improve the performance of the enterprise;(3)For policymakers,while leading the healthy development of the enterprise,they should actively improve the venture capital market to improve risk investment supervision mechanism.