The Study Of Internal Control Self-assessment In The Application Of A Company

We all know that sound and effective internal control is considered as a good method for companies to solve many potential problems. From the initial development of the internal check to the present comprehensive risk management, people all give high expectations to internal control. People generally believe that, internal control can make the company maintaining on the track to achieving its profit target and the company mission, and to keep this process in minimize risk; make the management able to handle the problems as rapidly changing economic and competitive environment, different customer needs and preferences, and re-build for future growth; can improve efficiency and reduce the risk of property damage and help ensure the reliability of financial statements and compliance with the rules and regulations. And internal control had not lived up to people's expectations, always playing the great support to the development of enterprise. However, suddenly, Barings failed in speculation and collapsed, Enron and WorldCom occurred the worldwide financial scandals, and Lehman Brothers went bankrupt, and so on. These failure events beat people's confidence about internal control. Even since these large enterprises have sound internal control system collapsed, for other companies, where their future road can be. The results show that the reason for those failures was the enterprises internal control not implemented effectively. It is in this context, the "Sarbanes - Oxley Act" was introduced to turn the tide. For the failure of implementation, the act forced the businesses to evaluate report and audit the internal control.In China, Guangxia's financial fraud, CAO Singapore's invention failure, the senior executives of Erie, and so on, these events detained witness to the failure of internal control. So in June 28,2008, the Ministry of Finance, the Commission, the Audit Commission, China Banking Regulatory Commission, China Insurance Regulatory Commission jointly issued the "basic norms of internal control." On April 26,2010, five ministries jointly issued the "Guidelines on Internal Control support." By the promulgation of the two norms, evaluation of the enterprise internal control has been made into the jurisdiction of the laws. The laws require the enterprises who implement the internal control system must self-assess the effectiveness of their internal control, disclosure annual self-assessment report, and hire an accounting firm to audit the self-assessment report and issue the auditing report.Internal control self-assessment (CSA) is a new technical methods system, which is participated by both internal audit staff and management, and is used to evaluate business-critical business objectives, the risk surrounding the achievement of objectives and the internal control designed to manage the risk. It gives management the primary responsibility to run and maintain the internal control, and meanwhile make the employees and internal auditors cooperate with management when assessing the effectiveness of the internal control.This thesis starts with the concept and the developing process of internal control, the background and the development of internal control self-assessment. Then analysis the status of the internal control of A company and the problems it may exist from the perspective of the five elements of internal control. In the final, suggest that A company should learn from foreign advanced experiences, use the internal control self-assessment to improve the internal control system. In the analysis process, this thesis fully learned the basic norms of internal control and internal control supporting guidelines.