Research On Construction Of Internal Control System Based On Risk Management In Faw Car Co., Ltd.

Internal control is a process implemented by the management and staff to improve operational efficiency, and ensure information true and reliable, and protect the assets safe and integral, and promote effective compliance of laws and regulations, and accomplish the development strategy. Internal control is also a management process of clear responsibilities, strong checks and balances, dynamic improving. There is no doubt that internal control is very important to the enterprise. With the advent of economic globalization, the socio-economic environment is rapidly ever-changing; the competition among enterprises is fiercer and fiercer, and the business risk is higher and higher. It is an urgent for the enterprises to strengthen management and improve the internal control system.At Present, Chinese automotive market is rapidly expanding and highly mature. As the core enterprise of FAW, FAW Car Co., Ltd sets the goal to build a bigger and stronger independent brand. In such a complex and brutal environment, building an internal control system based on risk management is a strong requirement for FAW Car Co., Ltd. Now, the internal control is given a new concept of comprehensive risk management, the internal control system is no longer meet the need inside and outside FAW Car Co., Ltd. .It is urgent to building a new internal control mechanism including the risk management.At the first part of the paper, I introduced the basic situation of FAW Car Co., Ltd., including the time of establishment, the main business, the company brand, organizational structure, operations and long-term planning. then I analyzed the current situation of internal controls in FAW Car Co., Ltd., and proposed eight issues.at last, considering FAW Car Co's strategic planning, competitive environment and regulatory requirements, I Raised the necessity for FAW Car Co., Ltd. to establish internal control system based on risk management.At the second part of the paper, I described the basic requirements for internal control system based on risk management. When analyzing the objectives, I proposed the integrating function of strategic objectives in the main objectives of internal control, and decomposed the objectives. The internal control principles, elements and content were determined as a response to the "basic norms of internal control". At last, I described the main steps of the internal control system construction.The third part is the main part of the paper; I detailed the methods to establish the internal control system based on risk management in this part. The construction program was divided into three main parts, including assessment and improvement of the internal controls in corporate level, risk identification and risk assessment, and the assessment of the internal controls operation. I gave the specific thinking, tools and techniques for guiding. This is the main innovation of this paper; I completely abandoned construction methods based on accounting control internal.At the end part of this paper, I introduced the maintenance, evaluation and supervision of internal control system. This is a new work based on a new understanding about internal control that internal control is a dynamic and continuous improvement process. In view of the requirements of regulatory agencies, the article also describes some of the work to meet the external oversight.As a exploration of the construction of internal control system based on risk management in FAW Car Co., Ltd.It not only can guide the actual implementation of FAW Car Co., Ltd. but also is a direct reference for other enterprises to build internal controls system based on risk management.