Research On The Internal Control Of Jiangsu Expressway BOT Mode

China's highway has entered an explosive jump stage of construction after it achieved its zero breakthrough from 1980's.According to statistics,as at the end of 2014,the total highway mileage in mainland has reached 111,950 km.Due to the huge demand for funds in the construction of highway,the shortage of government funds is a common worldwide problem.In response to the Public-Private-Partnership mode in the public service field in China,the highway construction has introduced the Build-Operate-Transfer mode more and more.Jiangsu Province has its unique BOT mode in the highway construction,that is to take the "investment,construction and operation" in separate way.The highway's investment raised by Jiangsu Communications Holding Company or its affiliated subsidiary Jiangsu Expressway Company Ltd.,and the local government's investment platform or the local capital introduced by local government,the highway investment fund ratio is generally 7:3 between Jiangsu province and local government.The highway construction completed by the urban highway construction headquarter which led by Jiangsu Province construction headquarter.The highway's operation are carried out by the highway operation company.This BOT model contains multi parties,including a listed company who not only represent the interest of its major shareholders,also represent the interest of all shareholders;the provincial government who act as the ultimate public service provider role;the local state-owned representatives who should on behalf of the interest of local government;the local private capital who represent the interest of private companies.Different parties have different interests,how to achieve the management target in the investment,construction and operation phase,how to achieve the balance among different parties,how to achieve the maximum economic benefits and public benefits of the highway,has become the focus of attention.On May 22,2008,"The Basic Norms of Internal Control" has provided guidance for establishing and strictly implementing internal control system in highway construction,operation and transfer phase,furished a strong basis,clear objectives and scientific guidelines.Therefore,this paper mainly adopts the risk management framework of COSO,the basic norms of enterprise internal control and the five elements guideline in the internal control framework,makes a research and study on the internal control practice of the BOT mode of Jiangsu province highway.First of all,this paper looks back at the theory basis and development stage of internal control,summarize the core internal control theory both in domestic and abroad,then draw the guiding significance of the internal control theory to establish the internal control system of the BOT mode for highway.Secondly,this paper describes the development characteristics of highway BOT mode,and the detail process of the build,operation and transfer phase,puts forward the internal control objectives for the three phases of BOT.According to the five elements theory such as internal control environment,risk assessment,control activities,information and communication,internal supervision,this paper investigate the feasibility to establish the internal control framework of the highway BOT mode.Finally,this paper takes the XY highway as an example,combined with the idea of internal control,analyzes the internal control of XY highway project,and puts forward the suggestions to improve the internal control of the three phase of BOT mode.This paper aims to provide some reasonable suggestion for the build,operation and transfer phase for the highway BOT mode in Jiangsu province.