Study On The Influence Of Internal Control Defects On The Completion Rate Of M&A

In the context of rapid economic growth in China,China's corporate M&A activities are becoming more and more active,and the number of successful M&A transactions continues to increase.In enterprise mergers and acquisitions,whether the merger can be completed is the most concerned issue of the enterprises of both parties,which directly affects the expectations of both parties' merger and acquisition transactions.The influencing factors of the success of corporate mergers and acquisitions mainly come from the national level,industry level,company level,transaction level,etc.,an important influencing factor at the company level is corporate governance,and internal control,as an important part of corporate governance,reduces information Symmetry,loosening financing constraints,improving investment efficiency and controlling risks have obvious advantages.A successful M&A business relies on systematic control of the entire M&A process,and internal control defects not only send an adverse signal to the market affect the company' s financing capacity and financing costs,but also hinder the management' s accurate prediction,effective supervision and M&A Integration,these will adversely affect the merger and acquisition activities of the main merger.Based on this,this paper selects the M&A transaction data of A-share listed companies from 2013 to 2018,and uses the method of combining normative research and empirical research to study the relationship between internal control deficiencies and the completion rate of M&A.At the same time,because the disclosure of internal control defects is also constrained by the external environment,this paper puts institutional investors and marketization process into the research framework,with a view to discovering the effects of institutional investors and marketization process variables on internal control defects and M&A completion rate.In addition,since the severity of internal control defects may cause different impacts on the M&A completion rate,this article conducted a regression analysis based on different degrees of defects.Finally,this article also conducted a group test on the samples according to the nature of property rights.In this paper,the main research conclusions are as follows:(1)The internal control defects is negatively related to the merger completion(2)The institutional investors can inhibit the negative influence of the internal control defects on completion rate(3)The marketization process higher area of enterprise internal control defect to the negative effects of the merger completion rate,significantly less than the marketization process of low area(4)According to the severity of defects,the impact of general defects on the completion rate of mergers and acquisitions is less than that of major and important defects,while the impact of major and important defects on the completion rate of mergers and acquisitions is not significantly different.(5)In non-state-owned enterprises,internal control defects are significantly negatively correlated with merger completion rate.Institutional investors can weaken the negative correlation between internal control defects and merger completion rate,while in state-owned enterprises,the above relationship is not significant.This paper constructed the internal control defects and the theoretical framework of the relationship between m&a completion rate,broaden the perspective of the m&a behavior characteristics and combined with the current system background,from the perspective of institutional investors holding and marketization difference analysis of the influence of the internal control defects on completion based on the characteristic differences between state-owned enterprises and non-state-owned enterprises in China,in the light of the different nature of property rights,discusses the influence of institutional investors holding internal control defects complete inhibition on m&a differences under the different nature of property rights,to optimize internal governance effective restriction for the enterprise provides the basis for low efficiency of mergers and acquisitions.