The Research On The Improvement Of ZY Company’s Internal Control Assurance Services

In order to further improve the quality of accounting information of listed companies in China,With reference to our nation conditions,SOX Act and AS5 guidelines.Relevant departments issued the "Basic Standards for Internal Control of Enterprises" and " Supporting guidelines for Internal Control of Enterprises" to build China’s internal Control normative system.The revised version of the “Standard Guide for Small and Medium-sized Listed Companies” issued in 2015 requires small and medium-sized listed companies to have an internal control audit report or an internal control assurance report for their internal control effectiveness related to financial reporting at least every two years.At present,the academic community pays more attention to the internal control auditing business and less attention to the internal control assurance business.However,in the audit practice,80% of the small and medium-sized listed companies issued internal control assurance reports,and compared with the internal control audit business,the internal control assurance service has more irregularities in the implementation process,so studying and improving status of internal control assurance service has important theoretical and practical significance.This paper takes the ZY group listed on the small and medium-sized board as an example to conduct a case study on the internal control assurance service.ZY Company is a strong manufacturing enterprise in the bearing industry.Its business covers a wide range,Therefore,its internal control has a certain representativeness.This paper analyzed four main processes that auditors perform on ZY company’s internal control assurance service: planning stage,implementation stage,the evaluation of internal control defect stage and completion stage.And found out several problems in this whole process: in plan stage,the assignment of personnel,time and work are unreasonable;in implementation stage,the authentication method is not properly applied,the internal audit work is not effectively utilized,and the company information system is unfocused;in the evaluation of the company’s internal control defects stage,the signs of major internal control defects are not paid attention to and the identified internal control defects are not evaluated;in completion stage,there are problems such as lack of review of working paper and the irregularities phenomenon of reporting language.The main reasons for these problems include four: the policy of internal control assurance business is not clear and internal control assurance service is not valued by both companies and accounting firms,In the process of implementation,auditors lack integration ideas and accounting firms lack training on members of internal control assurance services.After analyzing the above problems and causes,this paper believes that ZY company’s internal control assurance business should be improved from the following aspects: in planning stage,the time for authentication and the assignment of tasks should be rationally planned,the personnel training system should be paid attention to better control the quality and risk of this business;in implementation stage,The internal control assurance method should be improved,the work of internal audits should be used reasonably,the information system testing should be completed with the help of professional members;in the evaluation of the company’s internal control defects stage,the signs of major internal control defects should be appreciated and the identified internal control defects should be evaluated;in completion stage,the quality review system of the internal control assurance working paper and Language expression of internal control assurance report both should be normalized.