Research On Financial Restatement Based On Internal Control

Financial report is the most important information carrier in the capital market,and also the most intuitive reflection of the financial situation and profitability of the enterprise.For investors,the importance of financial reporting is self-evident.Financial report is the most important reference tool for investors' investment decisions.With the development of Chinese capital market,investors put forward more demands for the quality of financial reporting information,how to provide high quality financial reporting has become the key issues which the listed company is unable to avoid.When a financial restatement occurs,it often means that the information quality of the financial report of the enterprise has become a problem,and the enterprise financial report has lost its reliability.Considering our country capital market financial restatement incidents in recent years,the reason behind is not only the earnings manipulation of listed companies,but also the reflection of China's listed companies' internal control defects.The management of the company has the responsibility to ensure the fair expression of the company's financial report,and the construction of effective internal control is also the responsibility of management.Effective internal control can ensure the authenticity and integrity of financial reports and related information.Therefore,in a certain degree,the quality of financial information can directly reflect the performance of internal control.Therefore,it can be said that financial reporting information quality is closely related to the effectiveness of internal control.China's financial restatement system was established late,and relevant laws and regulations are not perfect.The study of financial restatement by Chinese scholars is subject to the situation of capital market,and there are still some areas that have not been involved.The research on the relationship between internal control and financial restatement is not mature enough.This paper focuses on improving internal control and reducing the frequency of corporate financial restatement.First of all,this paper reviews the relevant literature on internal control and financial restatement,and summarizes the existing research results.Secondly,this paper defines the concepts of financial restatement and internal control,and preliminarily defines the relationship between financial restatement and internal control.Again,from the aspects of the overall situation,the industry distribution of financial restatements,the cause of the financial restatement,the article analyzes the current situation of our country listed companies' financial restatements.Finally,taking kun ming machine tool as the analysis object,focusing on the financial restatements incident of kun ming machine tool,this article attempts to analyze the problems existing in the internal control,so that it can reduce its financial restatement of frequency and improve the quality of information disclosure.The study of financial restatement in China has both theoretical and practical significance.On the one hand,it enriches the study of financial restatement and broadens the research perspective.On the other hand,it is beneficial to protect the interests of investors,ensure the smooth operation of capital market,and provide new regulatory ideas for the regulators of capital market.