Research On The Impact Of Internal Control Quality On The Trade Credit Financing

In recent years, our country’s economy got a rapid growth. A batch of enterprise develop rapidly, as a spring bamboo after the rain. In the process of these enterprises’ development.To expand the scale and improve efficiency become the established goal of all enterprises. At the same time, the financing difficulty has become a major problem faced by the enterprises on the road of realization of goals. Although the government is also taking measures to help enterprises overcome the shortage of funds, but the financing difficult problem still can not get relief. How to help enterprises to accelerate the financing became one of hot topics of many scholars in recent years.Trade credit as alternative financing way of business bank loan got more and more attention in recent years, become one of hotspots in theory research. However, at present the study of trade credit are mostly about its motives, the study of the influence factors of trade credit is not enough. Especially the research on the relation between internal control and business credit is much rarer. Establishing effective internal control mechanisms, strengthening risk management, can protect the safety and integrity of the enterprise property, can ensure the healthy operation of the enterprise business activities and guarantee enterprise has enough ability to repay.High quality internal control can guarantee the authenticity and reliability of financial reporting information and enhance the trust between enterprises and external stakeholders.It is advantageous to the enterprise commercial credit financing.In this paper, The data in recent years has been used to study the internal control quality on the impact of enterprise’s trade credit.Using the data collected do the descriptive analysis, correlation analysis and regression analysis,take empirical test of the relationship between the internal control quality and trade credit. It also examines the regional marketitation level’s impact on the relationship between the two. By reading the existing literature,we found that the state-owned enterprises and private enterprises’ s dependence level on trade credit are different.The state-ownedenterprises can get more bank loans, compared with private enterprises, it depends less on trade credit. So, this paper further study that in different nature of property right of enterprises, the influence degree of the internal control to trade credit financing is the same or not. The obtained test results show that, the quality of internal control of enterprises will have a positive effect on promoting the trade credit financing. In our country, the degree of regional marketization is different,it can affect the relationship between internal control and internal control quality. In a high degree of marketization of regions, the internal control quality have bigger influence on the trade credit financing.Meanwhile, with respect to the state-owned enterprises that have strong financing ability, in the private enterprises that have weak financing ability, the positive influence of internal control quality on trade credit financing is bigger.According to the research results, we hope to be able to give some opinions and suggestions useful to corporate financing.