Internal Control,Ownership Concentration And Earnings Quality

Internal control developed from the initial using the internal containment mechanism to guarantee accounting information authenticity,curb accounting fraud of a single goal,to today's corporate transparency,prompt effective operation of enterprises effectively,to standardize the operation,to protect the interests of investors etc.overall role,expanding its role boundaries is expanding.And with the expansion of the role of boundary in the practical application of internal control,the academic circles also continuous the innovation of the corresponding theoretical basis and scope of the research,from the nature of the internal control,concept boundary,to the sphere of action and influence from within the control effectiveness factors to the internal control system of the economic consequences.Along with the continuous development and improvement of the internal control theory,the normative effect on the enterprise gradually by scholars to distinguish,that within the framework of the five goals--business management compliance,asset security,the truly and complete of the financial reports and related information,improve operation efficiency,promote enterprise to realize the development strategy on behalf of the "basic effect" and outside the framework to improve the enterprise credit value,protection of outside investors,maintaining orderly securities market health associated role as representative of the "spillover effect".The split share structure reform has broken the restriction of the institutional obstacles in the stock market of our country,and it is also a significant institutional reform of the establishment of the securities market of our country.It liberated the non tradable shares,so that the traditional "one share alone" phenomenon has eased,optimize the ownership structure,but the excessive concentration of ownership is still the most prominent problem in the corporate governance of our country.A late start in China's securities market,the lack of laws and regulations,the listed companies lack of external supervision mechanism of sound.This case,excessive concentration of equity,large shareholders lack of effective external balance,very easily lead to controlling shareholders use the absolute control,through malicious manipulation of listed company financial information and other means to seek their own interests,against the interests of minority shareholders and other external stakeholders.And internal control as the integrity of the enterprise system and the self-discipline system,can make up for the defects of capital market is relatively incomplete regulatory laws and regulations under the background of present system,effectively inhibit the major shareholder for personal gain "tunneling" behavior is worthy of our in-depth study of the proposition.The major shareholders from the malicious manipulation of earnings information,infringement of minority shareholders perspective,empirical study of internal control to regulate the behavior of controlling shareholders,whether there is spillover effects of the "effect" to protect the interests of minority shareholders."Through the empirical research,this paper draws the following conclusions:(1)the significant negative correlation between ownership concentration and earnings quality.(2)the negative correlation between ownership concentration and earnings quality has obvious inhibitory effect on the internal control.Internal control benefit by means of earnings manipulation in the standard big shareholders behavior has a good inhibitory effect,i.e.,internal control to regulate the behavior of controlling shareholders,and protect the interests of small and medium-sized investors exist outside the fifth goal,"basic effect"spillover effect.The conclusions of this study demonstrated the effectiveness of internal control to regulate behavior of large shareholders have significant "spillover effect",in China's current market regulatory system is relatively weak in the transitional period,from the micro level to strengthen enterprise internal control construction,to promote healthy development of the capital market as a whole and orderly in a large extent.