Research On The Internal Control Appraisal Based On The Risk Management

In recent years, the frequent occurrence of accounting fake and financial fraud cases inrecent years, especially the bankruptcy of Lehman Brothers and Merrill Lynch in2008, have ledto the argument about the internal control, which has already become the concerned focus of theacademic and the practical. It doesn’t mean the company has the perfect internal control systemor its internal control is effective when it builds the perfect system and policy of internal control.Therefore, we should evaluate the effectiveness of internal control from the design andimplementation of internal control. And it is perfect only when it is designed reasonably andimplemented effectively. Recent years, many related laws and regulations have sprung up likemushrooms and internal control has become a hot topic among people.On the basis of that, thispaper integrates risk management into the internal control appraisal system in order to promotethe construction of internal control appraisal system in China, which takes the idea of COSO’sEnterprise Risk Management---Integrated Framework (announced in2004) as a reference.The paper consists of seven chapters as follows:The first chapter is introduction which mainly describes the research background andsignificance, the research thought and approach, the current situation of internal control researchat home and abroad and the research innovations and shortages.The second chapter is review of the internal control appraisal theory. This chapter beginswith the risk management theory, then introduces the application of principle-agent theory,signaling theory, control theory and system theory in the process of internal control appraisal.The third chapter is relationship between risk management and internal control. This chapterelaborates the concept of risk management and internal control and the relationship betweenthem.The fourth chapter is establishment of internal control appraisal system on the basis of riskmanagement. This chapter builds the system of internal control appraisal, which mainly studieson the goal of internal control appraisal, the appraisal subject and object, the appraisal standardsand methods, the appraisal report,etc.The fifth chapter is building of enterprise internal control fuzzy appraisal model. Thischapter introduces the structure of internal control appraisal index and the application of theanalytic hierarchy process and fuzzy mathematics theory in internal control appraisal.The sixth chapter is research on the internal control appraisal of Z company. This chapter takes Z company for example,and explores the application of the analytic hierarchy process andfuzzy mathematics theory of the internal control in Z company.The seventh chapter is research on restrictions and prospects. This chapter summarizes theresearch results and the restrictions during the research in this paper and puts forward prospectsof future research.