Research On The Influence Of Management Characteristics On Internal Control Effectiveness

The important means of modern enterprise management is internal control. Thesuccess of the enterprise management need effective internal control. Themanagement is involved in the operation and management of the enterprise. They arecomposed of decision makers and executors. The management have some functions,such as decision-making, planning, organizing, leading and so on. So an effectivemanagement can improve economic benefits. And they can ensure the reliability ofthe enterprise financial report. What’s more, they can ensure that enterprise behaviorconform to the laws and regulations. But in company top managers have differentsocial backgrounds, different management experience, different professionalknowledge and personal preferences, which result in different characteristics. Thesecharacteristics have a different influence on the decisions and the strategic target ofthe enterprise. So different characteristics of management have a different influenceon the internal control effectiveness.This paper has used upper echelon theory, team theory, stakeholder theory,principal-agent theory as the theoretical support. At the same time, the paper has usedtheory and empirical research, qualitative and quantitative analysis, analyzed the dataof listed companies to research the impaction of management on the effectiveness ofinternal control. The paper inspect the influence of the five specific characteristics onthe effectiveness of internal control, which content of management ownership,management salary, management scale, management age, management degree. Andaccording to test of conclusions, the paper recommends optimizing the management.Through the empirical test, this paper verifies that management characteristicsimpact on internal control effectiveness. The main conclusions are as follows:management salary, management age, management degree impact on corporateperformance; management scale impact on financial reporting reliability; managementshareholding impact on compliance of laws and regulations.Innovation point of this article is that this article has used comprehensivemanagement characteristics to study their effects on internal control effectiveness.Although there are a lot of researches on internal control effectiveness. They used onesingle factor to study its effect on internal control effectiveness, such as executivecompensation incentive, corporate governance, personal background characteristics of management team and so on. But there is little research on comprehensivemanagement characteristics. The value of this research mainly helps to deepen theunderstanding management characteristics and helps to deepen the understanding oftheir influence on internal control effectiveness.