The Study Of Enterprise Internal Control Effectiveness Based On Corporate Governance

With the globalization of economy, competition between enterprises is not only including business strategy or product competition, it also including enterprise management system gradually. The generation and development of corporate governance accompanied with the rise of modern enterprise system, good corporate governance is helpful to improve the management and operation performance of enterprises and safeguard the interests of the shareholders and other stakeholders. Internal control is another important arrangement of modern enterprise system, effective internal control system is the guarantee of improving operation efficiency and effectiveness, the quality of financial reporting information, and ensuring that enterprise abide by the laws and regulations. In recent years, a series of financial frauds, business failure cases told us that as the cornerstone of modern enterprise system, corporate governance and internal control has become the compulsory courses of the survival and development of a modern enterprise. China’s enterprises want to outstanding in the fierce international competition, we must optimize the corporate governance, improve the level of internal control, so as to improve their management and control ability, effectively guard against operational risks. Excellent corporate governance is the basis and guarantee of improving the level of internal control, to strengthen the construction of internal control also can promote the improvement of corporate governance, which contain each other, promote each other. The construction and research of internal control in our country started later than western countries, as more and more attention paid to the internal control in recent years, we also made certain progress, but the research on the combination of corporate governance and internal control, especially in empirical research is burgeoning. Based on this background, this article titled "The study of enterprise internal control effectiveness based on corporate governance", tried to explore the construction of internal control from the perspective of corporate governance, provide relevant advice for the construction of our internal control, and aim at provide guidelines for practice and management.First part, including research background and significance of this paper, and puts forward the innovation points of this paper, arranges the research ideas and methods on the basis of analyzing research literatures related to corporate governance and internal control. The second part, basis of related theories, and introduces the development course of internal control theory, its development and current situation in our country, analysis the theoretical relations between corporate governance and internal control--both originated from the principal-agent theory, and there exists docking on the organizational structure; then defines this research is based on the COSO internal control, proposes a new evaluation method in this paper. The third part discusses the influence mechanism of ownership structure, board of directors, incentive mechanism and supervision mechanism on internal control. In the fourth part, an empirical analysis of the corporate governance effect on internal control effectiveness. On the basis of the former theoretical analysis, this part puts forward related hypotheses about the impact of corporate governance on internal control effectiveness, chooses listed companies in Shanghai main board from2010to2012as samples, and defines the relevant variables. Then extracts principal components with principal component analysis method, calculates the composite scores of internal control, and used as the dependent variable; defines the equity structure, board of directors, incentive and supervisory mechanism variables as the dependent variable; the natural logarithm of enterprise total assets and industry classification as control variables, builds the multivariate linear regression analysis model and analysis the results. The fifth part, draws the research conclusions and puts forward proposals: balancing ownership structure, and strengthening the supervision and restriction of controlling shareholders; improving the system of board of directors, and strengthening the construction of the audit committee; increasing the senior management remuneration, and improving the equity incentive mechanism; increasing the number of the board of supervisors meetings, doing real board of supervisors. At last, this paper makes future research prospects on the basis of research.