Research On Investment Internal Control Of Haikou Creative Venture Capital Company

Investment is the process that turning the enterprise funds into capital andrealizing captital gains,which typically has characteristics of large funds, high riskand long investment period. State-owned venture capital is an important part of ourcountry’s venture investment, plays an important role in driving industry policy,propelling government project investment,etc. However, due to the ventureinvestment’s low success rate and high risk, investment failures occur frequently,which have caused huge economic losses. Internal control is the foundation of modernmanagement, it helps enterprises to control operational risks,to regulate businessbehavior,to improve management efficiency and ultimately to ensure the achievementof the overall strategic target. The promulgation of “the basic standard for enterpriseinternal control”and related guidelines, provides policy basis for the research oninternal control on investment business.The article adopts Haikou creative venture capital company (hereinafter referredto as "Haikou VC ") as the research object, uses the related theoretical results of theinternal control theory and risk management theory, deeply analyses the company’sinvestment internal control systems and process, tries to put forward effective andfeasible suggestions for its internal control on investment business. In case part, thearticle firstly introduces Haikou VC’s present situation and existing problems oninvestment internal control. The analysis finds that the case company has problems ininternal control environment, risk assessment and business internal control process,ect.The effects of multilayer principal-agent relationship, the imperfection ofincentive and constraint mechanism, the neglected loopholes in internal controlprocedures are the direct cause of these problems. Finally, the article applies the fiveelements of internal control, gives recommendations for the company’s investmentinternal control which include perfecting the corporate governance structure andrelated systems, optimizing risk management procedures, comprehensively combinginvestment control procedures, strengthening information communication andfeedback and continuous improving investment business internal control system.