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China's Internal Control

Posted on:2008-03-29Degree:MasterType:Thesis
Country:ChinaCandidate:Y LiuFull Text:PDF
GTID:2199360245955779Subject:Business Administration
Abstract/Summary:PDF Full Text Request
Nowadays the internal control system of enterprise has already become the hot topic both in academic and business sectors,there are two main reasons for this,First,the forceful arrangement by relevant laws and regulations,for example,the US Sarbanes Oxley Act which sets forth strict guidance and severe punishments on all listed companies in USA:the new version of Chinese《Accounting Law》emphasizes the construction of enterprise internal control system;many regulations specify the forceful requirements establishing the system of enterprise internal control,such as《The internal accounting control basic criterion(version in soliciting opinion)》issued by China Finance Ministry on Feb.14,2001,《The relevant regulations for enhancing the currency treasury accounting control(version in soliciting opinion)》as well as《the information disclosure compiling regulation for the public security issuing company issued by CSRC on November, 2000.Secondly,from the view of reality,it is very popular that many enterprises have bad business performance in China and manipulate the accounting figures,financial reports;and even operate against the laws and regulations,such as the collapse of "Yin guang xia",the ruining of the "Lantian"and"Dongfang electronic",the manipulation and fraudulence case of "Chengdu Hongguang".Those companies were the "best performance" pioneer which had mach influence on the capital market in the past,however,with the maturity and improvement of the security market and much efforts on inspection of execution of relevant laws and regulations,the beautiful and illusive "bright ring" of those companies formed by manipulation faded out gradually,and the real bad situation appeared step by step.Therefore,in reality it is urgently required that China needs to establish and improve its internal control system.Additionally with the entrance to WTO,Chinese companies face more pressures and severe challenges,thus,the main issues and difficulties that Chinese companies face are how to enhance their own competitive competence,and how to prepare themselves ready for international current of global competition in more active way.The internal control system,as a method for the bailee of the company's management to fulfill its managerial targets and responsibilities,will take a critical role in company internal management,monitor and control activities This essay first describes the general principles,such as the definition,basic structure and methods of internal control,then, analyses the current situation in china from four aspects(especially the accounting issues), explains why these situations happen,and further sets forth the basic measures to improve the internal control,that is well balance the relations in internal control and six measures which could be taken.Finally,according to the case study of internal control of SINOPEC, I set considerations about the internal control to provide a framework and reference for the establishment of enterprise internal control system,and further wish to accelerate and promote the development of internal control system in China broadly and make progresses fundamentally.
Keywords/Search Tags:internal control, accounting control, management control, Sinopec Group
PDF Full Text Request
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