Study On The Influence Of Internal Control On The Level And Value Of Cash Holdings

During the daily business activities of enterprises, the rational cash holdings and distribution needs certain mechanism to supervise and restrict. It can ensure higher efficiency of cash management, so as to enhance enterprise value.In recent years, the level of cash holdings generally higher than in other developed countries,scholars have begun to pay more attention to cash holdings. Studies have shown that internal control relieve agency costs,it is likely to be the most direct control mechanism in enterprise cash management.But few scholars study issues that agent costs affect the value of cash holdings from the perspective of internal control.Therefore,it is necessary to study the relationship between internal control and cash holdings.This paper researches domestic and foreign relevant literature widely and deeply,defines the concept of internal control,the level and the value,and elaborates the related theory of cash holdings.This paper analyzes the agency cost theory mainly,puts forward the preliminary research hypotheses on the basis of it,it is held from both cash holdings and cash value dimensions to analyze the internal control mechanisms of the impact on cash holdings.This paper selects all A-share listed companies in 2012-2014 sample data in China, using theoretical analysis and empirical analysis, mainly empirical research methods.This paper builds two research model of cash holdings and cash value by empirical test internal control on cash holdings mechanism.This paper measures the quality of internal control on the basis of the five goals DIB internal control,and ensures every index,further analyses the sample enterprises' present situation of internal control and the level of cash holdings,and does the liner test and regression analysis.Through empirical analysis,the results were as follows:(1)The higher quality of the internal control is, the higher the level of cash holdings will be.(2)Chinese cash value leads to some discount effect.Market value of cash held by enterprises is less than its book value.The discount effect has been reflected in the sample companies.(3)Improving the quality of internal control helps to improve the value of cashholdings. Finally,I put forward relevant policies and suggestions on basis of the conclusion.