Research On The Influence Of Independent Audit Quality On The Disclosure Of Internal Control Defects

The frequent occurrence of incidents such as non-standard information disclosure of listed companies,the establishment of internal control and the soundness of relevant information disclosure system are more and more concerned by the state.Since 2012,China has forced the shanghai and shenzhen's main board to disclose the internal control self-evaluation report after assessing by the accounting firm,In particular,the disclosure of internal control deficiencies and types.The enterprise disclosure of the internal control deficiencies is affected by various aspects,and the independent audit is a key area that the company should be aware of.As part of the corporate governance,accounting firms shall audit and supervise the the internal control of the corporate from outside,on the one hand,through the complement in the company's ability of finding,find more the existing deficiencies of internal control,and help the company improve the internal control and help the internal control play an important role in the governance;On the other hand,supervise the company's real disclosure of internal control.Therefore,it is necessary to explore the effect of the independent audit quality on the disclosure of internal control deficiencies.This is of great guiding significance to help companies find undiscovered deficiencies due to their lack of ability to find internal control deficiencies,perfect the internal control system,realize the protection of various stakeholders and achieve the healthy development of the enterprise.In this paper,Firstly,the related literatures of the independent audit quality and internal control deficiencies of the domestic and foreign are reviewed,and related concepts and theories of the independent audit quality and internal control deficiencies determination were simply introduced.Secondly,on the basis of the above,the paper analyzes the influence mechanism of independent audit quality on internal control defect information disclosure,and then puts forward the relevant hypotheses.Finally,this paper selects the A-share motherboard's listed companies of Shanghai and shenzhen which disclosed the Financial restatement caused by internal control deficiencies in 2012-2016 as the research sample,using the empirical research method to test the relationship between independent audit quality and information disclosure of internal control deficiencies,to test the relationship between independent audit quality and the severity of internal control deficiencies and the influence of independent audit quality on the disclosure of internal control deficiencies in companies with different property rights.By studying the effect of the independent audit quality on information disclosure of internal control deficiencies,this paper hopes that listed companies shall pay more attention to the internal control audit quality,and at the same time puts forward some constructive suggestions for the listed companies in hiring the internal control audit firms and accounting firms in raising the quality of auditing services.Through standard analysis and empirical inspection,this paper draws the following conclusions: firstly,the higher the independent audit quality,the more able to find the existing internal control,and then disclose more has the defects of internal control deficiencies;Secondly,the independent audit quality is positively correlated with the disclosure of existing more serious internal control deficiencies significantly;Thirdly,the independent audit quality of state-owned enterprises has a greater positive influence on the disclosure of internal control deficiencies.These conclusionsprovide empirical evidence for improving the disclosure of internal control defect information and improving internal control system from external audit supervision.