Internal Control, Relationship Networks And Enterprise Value

In china,Relationship have a m ajor contribution to the developm ent of enterprises.they face a lot of problem s in the p rocess of pr oduction and operation, and they n eed their relationship networks to overcom e the difficulties in the respects of market, funds shortage, human resources and techniques. Based on the perspective of business relationship network by firms and their key custom ers, this paper selects Chinese listed firms between 2001 and 2011, and explores how relationship networks impact on firm value, and of fers reference and enlightenment of how to identif y the cruc ial external conditions and allocate resources rationally to improve the Enterprises Performance for the enterprises.The result shows relationship networks can he lp to reduce transaction cost and im prove firm value, and relationship networks can partial substitute for internal control, and the relation is stronger for firm s in regions with less developed legal environm ents. The study on the substitution effect of relationship networks on internal control extends current relevant researches. With the low internal control quality in China, relationship networks will function well.