Study Of A Securities Company Underwrites Business Risks, Internal Control Mechanisms

With the constant development of China's securities market and securities underwriting business, securities underwriting business, one of the core businesses of a securities company, had been paying attention to every securities company because of its properties in high-risk and high-yield. Though China's securities companies have development and have made some achievements in recent years, but also accumulated a number of issues. For example, the ownership structure is not scientific, vicious competition, excessive packaging and other issues. This thesis introduces the details of the securities underwriting business processes, while revealed a number of problems of internal control. Securities underwriting business is facing great risks because of the existence of the risks. First of all, systemic risk, which is also called market risk, stock market fluctuations, the form of issuing underwriting as well as national macroeconomic regulation and control policy would give securities firms underwriting business risk. The second is the examination risk, although the beginning of 2001 China's securities distribution system changed to approval system, but there is still much right to the SFC, if the project can not be audited, securities companies will suffer losses. The third is competition risk, as there is fewer and fewer high-quality projects, all securities companies begin to compete maliciously in order to get those projects. Fourth, price risk, pricing inappropriate will occupies the securities company's own cash. According to these risks, this thesis gives some suggestions followed:fist, dispersed the ownership structure so that all shareholders can be mutual checks and balances. Second, set a reasonable organizational structure in security underwriting business unit. The third is setting up a scientific system of staff incentives. The last is information communication and disclosure. Through the method above to establish and perfect the internal control mechanisms of underwriting business, to prevent and control risks, improve underwriting business and the securities company's profitability and corporate image.