Research On Internal Control Defects Of Listed Companies In The Automobile Manufacturing Industr

The construction of internal control system of listed companies plays a crucial role in controlling risks and realizing high-quality development,which is conducive to the realization of strategic development goals of the company.From the United States shocked the world "Enron incident","Worldcom false profit incident" and other financial fraud scandals were exposed,to the domestic exposure of Yinguangxia incident,Credit Suisse coffee financial fraud incident…… Seriously disturbed the order of the development of market economy,hit investors’ confidence in investment.These violations are linked to enterprise control defects,now the capital market in all countries of the world started to focus on the direction of external governance into internal governance,pay more attention to the construction of internal control system,compared with the developed countries with mature internal control environment,also in the internal control system construction in China need to further improve.Domestic and foreign theoretical research on internal control is more and more in-depth,which also effectively promotes the current governance of listed companies,improve and optimize the investment environment.Zotye Automobile Co.,Ltd.is a private enterprise mainly engaged in the manufacturing and sales of complete automobiles.After completing merger and acquisition of listed company in 2017,all kinds of financial index declined obviously,revenues,profits from positive to negative,capital chain rupture,company’s shares held by the parent company is frozen,enterprises are facing bankruptcy reorganization,this a series of events,make the enterprise internal control problems exposed,influenced the steady development of enterprises.Therefore,this paper will*ST Zotye as the research object,on the basis of the existing theory,in-depth discussion of its problems in internal control.This paper analyses the existing major asset purchases*ST zhongtai lack investigation and feasibility study,external guarantees not to perform the review and disclosure procedures,and some suppliers exist large funds,pay super annual order quantity,the total annual financial report compilation process control was not effective implementation of internal control defects,major Then,under the guidance of China’s "Basic Norms and Supporting Guidelines for Enterprise Internal Control" and COSO(2013)"Internal Control--Integrated Framework",the causes of major defects are deeply analyzed from the five aspects of control environment,risk assessment,control activities,information and communication and supervision activities.Then the economic consequences of the internal control defects of*ST Zotye are discussed from two aspects of market reaction and financial performance changes.The internal control defects lead to a sharp drop in the stock price of*ST Zotye,reducing investor confidence;The profitability of the company is reduced,the development prospect of the company is not optimistic,the debt paying ability is reduced,the interests of creditors can not be guaranteed,the overall business condition is very poor,and the operation ability of the management needs to be improved.Finally,the paper puts forward some suggestions on internal control based on its own environment and operating conditions.From the case of*ST Zotye Company,the problems existing in the internal control status of listed companies in China’s automobile manufacturing industry are generalized and universal suggestions are put forward.This paper hopes to enrich the case study literature on internal control defects of automobile manufacturing enterprises in China with the help of the study of internal control defects of*ST Zotye,and also hopes to put forward effective suggestions on improving internal control defects of*ST Zotye and the whole automobile manufacturing industry,so as to promote the sound development of the industry.