The Empirical Study On The Influence Of Internal Control Quality On Inefficient Investment Of Company

The investment activities of enterprises are a way to increase the value of enterprises.However,due to the existence of information asymmetry and agency conflicts in the capital market of our country,the inefficient investment behavior generally exists.With the introduction of Sarbanes Act in 2002,the quality of internal control has been highly concerned at home and abroad.Subsequently,the basic norms and related supporting guidelines issued by our country marked the basic completion of the internal control system in China.Internal control quality will play a greater role in governance.The management of enterprises is paying more and more attention to the quality of internal control.The improvement of internal control quality is not only in daily operation.The process has played a greater role in governance and will also play a role in investment activities.Scholars have also extended the study of internal control quality to the field of investment.This paper discusses whether internal control quality plays a governance role and how it will affect the inefficient investment of enterprises.In order to explore whether internal control quality can play a good governance role in the field of investment and reduce the behavior of non-efficient investment,it is necessary to explore the relationship between internal control quality and enterprise non-efficiency investment on the basis of previous studies.In this paper,the background and significance of the research are first described.According to the domestic and foreign research on inefficient investment and internal control quality,the research direction of this paper is determined,and the research methods and research framework are defined.Secondly,the concepts of inefficient investment and internal control quality are defined,the information asymmetry theory and the principal-agent theory are expounded,and the research hypotheses are put forward on the basis of the theory.Finally,this paper selects the listed companies of Shanghai and Shenzhen motherboard from 2014-2016 from the CSMAR database as the sample,and uses Richardson to invest inefficiently.The residual of the model is taken as the explained variable,the natural logarithm is taken as the explanatory variable,the main control variable is selected,and the multivariate regression modelis constructed,and the empirical analysis is carried out.To test the relationship between internal control quality and inefficient investment,and consider the relationship between internal control quality and inefficient investment under different property rights.The results show that,first,the phenomenon of inefficient investment exists in the process of investment of listed companies in China,and underinvestment is more common than excessive investment.Second,the quality of internal control plays a role in the field of investment.The quality of internal control has a negative impact on overinvestment and underinvestment,and the quality of internal control plays a significant role in alleviating the underinvestment.However,the inhibition of excessive investment is not significant.Thirdly,considering the influence of property right,the improvement of internal control quality has a greater effect on the non-efficiency investment in non-state-owned enterprises.