Improve Internal Control Mechanisms To Strengthen The Risk Management Of Commercial Banks

with the accelerated pace of globalization of the financial industry,macro financial risks arising and international transmission occurring new features,china's banking industry has entered a new development and faced greater risks.internal controls have become the dynamic processes and mechanisms to protect commercial banks to achieve their operational objectives.therefore,the study of how to improve the improve the internal control of commercial banks in china and strengthen risk management has a good sense of reality.This paper is focusing on how to improve the internal control mechanisms of commercial banks in china and strengthen their risk management. Apart from introduction,this paper is divided into three parts:The fist part is the foundation.first,it introduces the meaning of internal control, commercial bank's risk types and the relationship between risk and internal controls.second.it includes an economic analysis on the relationship between internal control and risk management,which focuses on the principal-agent theory analysis,and finally makes a corresponding conclusion.On the basis of the first part,the second part includes an analysis,of the current status of internal controls and the reasons for china's imperfect internal control mechanism,both from internal and external aspects.through analysis it comes up with the necessity to improve the internal control of commercial banks in china .then with real cases it specifically analyzes the inadequate internal control mechanism of china's commercial banks .The third part raises the main ideas to improve our internal controls and strengthen risk management from eight areas: improving corporate governance structure,constructing an incentive mechanism to guard against risks agent,establishing a quantitative evaluation mechanism,forming internal culture,establishing a risk assessment and enhancing information disclosure and so on .This paper focuses on the microeconomic level .starting from the empirical study and on the basis of the above analysis ,it has a study of internal controls in the form of cases.finally,it gives proposals to improve internal control of china's commercial banks.