The Study On Internal Control Environment Of Listed Chinese Firms

In some western developed countries, enterprise internal control, which is thedemand of economic development and management of modern enterprise, has becomemature gradually, but it is in the initial development stage in our country. Internalcontrol environment is the important component of internal control and is the top ofthe five factors of internal control. To be the core and basis of other concerned internalcontrol factors, internal control environments is the basis of the foundation of internalcontrol system and a powerful guarantee. Internal control environment is the basis ofother concerned internal control factors and lead the foundation and running ofinternal control and to some extent also constrain its validation.In recent years, there are many problems, of which many domestic andinternational listed firms had heavy loss because of different types and different levelsof defects of internal control, brings some crisis to the domestic and abroad economyand serious setbacks and profound effects to domestic and international concernedbusiness and enterprises. In order to avoid such problems, internal control has to beenstudied deeply, especially for internal control environment and operated strictly in thelisted firms. Internal control can be implemented effectively if internal controlenvironment is optimized.The thesis has four parts. The first part introduces the development and evolutionof internal environment and status of control environment, and gives the definition ofinternal control environment, and proposes the factors of studying internal controlenvironment. The second part studies the problems and the reasons of internal controlenvironment in Firm X referring to company governance structure, internal audit,human resource, company culture and legal environment. The third part proposes theways and measures of optimizing Firm X internal control environment, and comes upwith the optimizing measures of the five internal control environment factors. Thefourth part concludes some measures of optimizing internal control environment fordomestic listed firms as Firm X.