Goal-oriented internal control index research

Since the US enacted the SOX Act in 2002, internal control practices and theoretical research have made great strides. Based on the experience of foreign countries, the Ministry of Finance and other five ministries have issued the basic norms of internal control of enterprises (hereinafter referred to as basic norms) and the guidelines for internal control of enterprises (hereinafter referred to as supporting guidelines), forming a Chinese enterprise. Internal control specification system. Since January 1, 2011, China's listed companies have begun to implement the internal control standard system in batches and batches. At present, China's main board listed companies have fully implemented the internal control system of enterprises, and small and medium-sized board and GEM listed companies voluntarily disclose internal control evaluation reports and internal control audit reports.

With the gradual strengthening of the implementation of internal control of enterprises in China and the continuous expansion of scale, the theoretical and practical circles are eager to understand the effects of internal control implementation and its influencing factors, which necessarily involve internal control evaluation, but currently China’s internal control There are many shortcomings in the evaluation techniques and methods. The theoretical and practical circles urgently need a scientific and comprehensive method to evaluate the quality of internal control of enterprises. Based on the review and theoretical analysis, this paper builds a goal-oriented internal control index based on China's institutional background, scientifically and comprehensively evaluates the effectiveness of internal control of listed companies, provides internal control for listed companies, and provides evaluation for regulatory authorities. Provide a basis for the internal control level of listed companies and provide a quantitative basis for empirical research on internal control.

(I) Internal Control Defect Index The SOX Act requires the management of listed companies to evaluate the effectiveness of internal control and disclose internal control deficiencies, and employs CPAs to conduct internal control audits. Based on this institutional background, some scholars have included in the evaluation of internal control efficiency whether to disclose internal control defects, or by dividing internal control defects into major, important, general defects, or company-level, accounting-level internal control database1. Listed companies follow the internal control deficiencies and internal control audit report data disclosed in the SOX302 and SOX404 terms.

In China, Li Wanfu et al. (2011) obtained internal control defect information from self-inspection reports and rectification reports, and built an internal control defect index. Tian Gaoliang et al. (2010) used the method of GeandMcVy (2005) to construct an internal control defect index. Zhou Shouhua et al. (2013) conducted a study on the status quo of internal control of listed companies in 2012 and found that among 2,223 listed companies that disclosed internal control self-evaluation reports, only 8 companies disclosed major defects. Shenzhen Dibo Enterprise Risk Management Technology Co., Ltd. (hereinafter referred to as “Shenzhen Dibo”

The internal control and risk management database 2 was constructed, which contains internal control defect data disclosed by listed companies since 2007.

The internal control defect index is constructed to provide internal control for scientific research. This paper is the national natural science fund key project “Research on the effectiveness of internal control based on Chinese context” (71332004), National Natural Science Foundation project (71272198, 71032006), Guangdong Province Phased research results of the Humanities and Social Sciences Key Research Base Project (11DXM79004), the Humanities and Social Sciences Research Youth Fund Project of the Ministry of Education (14YC790097) and the Kuanchuan Outstanding Youth Scholarship Fund Project (2013).

The foundation of the development has promoted the development of empirical research on internal control. However, there are some problems in the existing internal control defect index research, which are mainly reflected in: First, the US internal control defect disclosure and internal control defect division have certain subjectivity, and the US listed companies only disclose internal control defects of financial reports; The identification and disclosure of internal control defects are still in their infancy in China (Yang Youhong and Li Yuli, 2011). The definitions and classification criteria of internal control defects are not uniform. For example, Li Wanfu et al. (2011) define major defects in internal control according to internal control auditing standards. Tian Gaoliang et al. (2010) limited internal control defects to account level defects. Third, the current disclosure of internal control defects in China is not standardized. Listed companies generally have to avoid heavy weight when disclosing internal control defects, and classify some major defects as important defects or The phenomenon of general defects (Ding Yougang and Wang Yongchao, 2013), the phenomenon of omission or concealment disclosure is also more common. 3, the existing internal control defect index is difficult to truly and objectively reflect the quality of internal control of listed companies.

(II) Process-oriented internal control index Some scholars evaluate the internal control information disclosed by listed companies by constructing an evaluation index system to form a process-oriented internal control index. Botosan (1997) builds a corporate disclosure index based on information voluntarily disclosed by 122 manufacturing companies. Moerland (2007) from the disclosure of internal control scope, the description of internal control systems, the improvement of internal control systems or the disclosure of major changes, the evaluation of the effectiveness of internal control systems, the responsibility of management for internal control, the supervisory board of internal control systems and The internal control information disclosure index is built in the nine aspects of the audit committee's functional role, whether to establish an internal control guide with international perspective, external audit disclosure, and whether to disclose internal auditors' internal control functions.

In China, some scholars use internal control self-evaluation reports or internal control audit reports to measure the quality of internal control of listed companies (such as Fang Hongxing et al., 2009; Xiao Hua and Zhang Guoqing, 2013; Xi Yan, et al., 2012; Etc., 2011). Some scholars constructed internal control information disclosure indexes based on the internal control information disclosed by listed companies. For example, Sun Wei and Lin Bin (2008) and Shenzhen Dibo's process-oriented internal control index construction provided new ideas for measuring internal control quality. To a certain extent, it promotes the development of empirical research on internal control in China. However, there are still some problems in the existing process-oriented internal control index. First, there are too many subjective judgments when scoring internal control information disclosed by listed companies. Second, whether internal control information disclosure can measure the quality of internal control remains to be discussed. Third, the process-oriented internal control index is based on voluntary disclosure of internal control information, but current main board listed companies enforce internal control system and follow the company issued by the Securities and Futures Commission on January 3, 2014. The general rules for the internal disclosure evaluation report of the Information Disclosure and Regulation Rules No. 21, while the small and medium-sized board and the GEM listed companies voluntarily implement the internal control norm system, voluntarily disclose internal control information, and the changes in internal control regulations make the process-oriented internal control index Can not adapt to the development of current internal control practices.

(III) Target-oriented internal control index The goal-oriented internal control index is based on internal control objectives. (2009) Selected 112 US listed companies that implemented enterprise risk management in 2005 as a sample, released by COSO in 2004. The enterprise risk management integration index (hereinafter referred to as COSO-ERM) is based on the strategic objectives, business objectives, reporting objectives and compliance objectives, and forms the Enterprise Risk Management Index (ERRIndex). Zhang Ying and Zheng Hongtao designed the internal control index based on the achievement of the four goals of COSO-ERM (2004) through questionnaire survey. Zhang Xiangzhi and Dai Wentao constructed a three-in-one internal control evaluation model for enterprises, certified public accountants and regulatory authorities, and designed a corresponding internal control index system.

The China Internal Control Index Research Group (2011) and Zhang Zhaoguo (2011) built an internal control index based on the realization of the internal control objectives of the basic norms.

The goal-oriented internal control index study is helpful to comprehensively evaluate the effectiveness of internal control implementation. However, the main problems in the current index research are: first, the theoretical basis of index construction is weak; second, the index selection is poorly representative and cannot be systematically Comprehensively reflect the effectiveness of internal control of listed companies.

In view of the current shortcomings in the internal control index research, it is necessary to further explore the internal control index to reflect the true state of internal control of listed companies scientifically and comprehensively. This paper will build a goal-oriented internal control index from the perspective of internal control "results".

Third, the goal-oriented internal control index construction based on this section discusses the goal-oriented internal control index construction basis, including the foundation and premise of the rational construction framework.

System theory emphasizes the use of systemic thinking to describe and understand the characteristics of complex systems. It requires that all parts of the system, each link, and the internal environment of the system and the external environment of the system be regarded as dynamic relationships that are interconnected and mutually constrained, and establish dynamic development. Point of view, looking for the optimal solution that the system can achieve. As an index to quantify the level of internal control, we should fully consider the dynamic interaction of each goal and each element of internal control from the perspective of system thinking. The index construction should not only fully reflect the internal control of the enterprise, but also fully consider the objectives and elements. Intrinsic connection, comprehensive, systematic, scientific and feasible.

(2013) requires management to implement the goal-oriented and principle-based approach in internal control. When the five elements of internal control exist and function, and internal control is achieved when the internal control objectives are reasonably guaranteed, internal control can be considered effective. of. The COSO framework is the internal control practice for hundreds of years. 3 The average ratio of major defects disclosed in the US three years after implementing SOX404 (2004-2006) is 12.81%, and the disclosure of China's internal control system after three years (ie 2011-2013) The average ratio of major defects is only 0.72%, which is nearly 18 times different.

The crystallization of summarization and conciseness has been widely recognized by countries all over the world. COSO (2013) has a broad and cutting-edge nature and is a relatively complete internal control framework. Based on it, COSO (2013) can make the target-oriented internal control index have a solid theoretical foundation.

The realization of the system goal is based on COSO-ERM (2004). Based on the strategic objectives, business objectives, reporting objectives and the degree of achievement of the objectives, the effectiveness of the internal control of the enterprise risk management index evaluation is constructed. Among them, the market share and risk coefficient indicators are selected to measure the strategic objectives, the total asset turnover rate and labor productivity indicators are selected to measure the business objectives, the audit opinions, financial restatements and major defects are selected, the earnings management indicators are used to measure the reporting objectives, and the audit fees and claims losses are selected. Indicators to measure compliance with goals. According to the review of this article, since the release of the SOX Act, 84 internal control empirical papers have been published (or have been accepted) in the TOP55 journal of International Accounting. The internal control of China in recent years only provides a solid theory for the study of this paper. basis.

Based on theory and theory, build a goal-oriented internal control index.

With the rapid development of the economy and capital markets, the Chinese government has begun to pay attention to the issue of the internal control system of enterprises. The basic norms and supporting guidelines promulgated by the Ministry of Finance and other five ministries have basically formed a system of internal control norms for Chinese enterprises. This system consists of two parts: the standard system and the evaluation system. The standard system consists of basic norms and 18 internal control application guidelines. The evaluation system is based on the internal control evaluation guidelines of the enterprise and the system background based on the basic norms and supporting guidelines of China. Construct a goal-oriented internal control index.

Statistically, the index has two meanings. The first layer is the general concept of the index, that is, the comprehensive reflection of the relative change of the economic phenomenon composed of various factors under different time or space conditions; the second layer is the analysis of the index. The law, which is a statistical analysis method that reflects the total number of changes in an economic phenomenon and the extent to which its constituent elements affect the total change by calculating various indices (Xu Guoxiang, 2011). The basic role of the index is to reflect the overall direction and degree of change of complex socio-economic phenomena, and to make comprehensive evaluation and measurement of socio-economic phenomena.

According to the theory of statistical index construction, index design generally needs to go through four key steps.

First of all, the indicator system needs to be based on relevant theories and systems, guided by the index construction goal, the index construction principle is the yardstick, and the evaluation index system is scientifically and reasonably constructed.

Second, the indicators are dimensionless. Since the actual values ​​of the various evaluation indicators represent different economic meanings, there are differences in the dimensions, which will lead to incomparability between the indicators. Therefore, statistics make the indicators non-dimensionalized, making the indicators comparable.

Non-dimensionalization is also called the standardization and normalization of data, that is, the method of eliminating the influence of the original index dimension through mathematical changes. There are three main types of dimensionless methods, linear dimensionlessness 6, polyline-type dimensionless, and curve-type dimensionless.

Third, determine the weight of each indicator. According to the method of weight generation, the subjective weight evaluation method and the objective weight evaluation method can be divided. The subjective empowerment evaluation method mainly adopts a qualitative method, and experts obtain subjective judgments based on experience to obtain weights, such as analytic hierarchy process, fuzzy evaluation method, Delphi method and so on.

The objective weighting evaluation method is based on the correlation coefficient or coefficient of variation between indicators to determine the weights, such as entropy method, principal component analysis, and gray correlation analysis. In the research, it is necessary to select one or more methods depending on the nature and purpose of the evaluation object.

Fourth, establish a comprehensive evaluation model, that is, build a total index. In the comprehensive evaluation of multiple indicators, it is necessary to combine multiple indicators to evaluate the different aspects of things through a certain formula or model to obtain a holistic evaluation and form a total index. The mathematical methods that can be used for synthesis generally include: linear weighting method, multiplication method, and a mixture of the two methods. When applying, the appropriate method should be selected according to the object to be evaluated.

This paper starts from the index construction target and index construction principle, scientifically and rationally selects the evaluation index, adopts the linear non-dimensionalization method, uses the combination of subjective and objective methods to determine the index weight, and uses the linear weighting method to obtain the total index.

Fourth, the goal-oriented internal control index construction framework Based on the basis of index construction, this section will systematically expound the goal-oriented internal control index construction framework, clarify the index construction goal and index construction principle, and divide the index hierarchy. The goal-oriented internal control index construction logic is as shown.

According to the internal control index construction basis, combined with the actual situation of China's index supply and demand, this paper constructs a goal-oriented internal control index, aiming at achieving the following objectives: scientifically and reasonably evaluate the company's internal control level, and comprehensively and objectively reflect the current status of the company's internal control operations.

The Accounting Department of the Ministry of Finance (2013) reported on the accounting reform and internal control construction of the US and Canada. Most Canadian listed companies adopt the US COSO framework, and only about 10 listed companies adopt the Canadian CoCo internal control framework. As CoCo's internal control framework is less well-directed, it is gradually declining.

The basic idea of ​​linear non-dimensionalization is to assume that there is a linear relationship between the actual index and the evaluation index, and the evaluation value varies proportionally with the actual value. See the Qiu Dong for details on the dimensionless method. 1991. Systematic analysis of multiple indicator comprehensive evaluation methods. Beijing: China Statistics Press.

Figure i The goal-oriented internal control index construction logic evaluates the effectiveness of the company's internal control design and operation, and promotes its continuous improvement of internal control and enhances company value.

Provide decision-making basis for stakeholders in the capital market, especially for investors and creditors.

To guide the regulatory authorities to understand the status quo and existing problems of the company's internal control regulations, ensure the timeliness and pertinence of regulatory measures, and promote the long-term development of the capital market.

Provide internal control research for the academic community, quantify internal controls, and provide data support.

In order to effectively evaluate the quality of internal control of listed companies, the principles must be followed when constructing the index. Starting from the goal of index construction and considering the availability of data, this paper believes that index construction should follow the following principles: the principle of science. The index design is based on theory, system and method basis, and is scientific and reasonable, so that the evaluation results objectively reflect the internal control quality of listed companies.

Systematic principle. The internal control evaluation is a complex system engineering. The index construction should use the system theory to fully consider the economic consequences of internal control. The system reflects the realization degree of the internal control objectives, so that the evaluation results comprehensively and truly reflect the internal control quality of the listed company.

The principle of comparability. The internal control index should have a universal statistical significance, so that the measured internal control level of the enterprise can achieve temporal and spatial comparison, and ensure that the internal control index has horizontal and vertical comparability.

The principle of operability. The data of the internal control index is derived from the financial data, information disclosure data and media materials of listed companies. The index design should be realistic and fully consider the availability of the data.

Cost-effectiveness principle. The internal control evaluation should weigh the evaluation cost and the expected benefit. From the importance, choose the most representative index and the appropriate method to construct the internal control index.

Enterprises should implement the goal-oriented and principle-based methods in internal control. When the five elements of internal control exist and play a role, when internal control objectives are reasonably guaranteed, internal control can be considered effective. This article starts from the practice test standard, from the "results" of internal control

Departure, design an internal control index around the degree of achievement of internal control objectives.

If a high index of internal control, shows that the company's internal control objectives to achieve a higher degree, thereby infer higher level of internal control of the enterprise.

Camp manage legal compliance, asset security, financial reports and related information is true and complete, improve operational efficiency and effectiveness, promote enterprises development strategy. Based on the classification into three levels (as shown), the three levels present a relationship that is progressively included from a single connotation to a comprehensive connotation.

The first level is the basic level, including the three internal control objectives of reasonable assurance of corporate legal compliance, asset security and reporting reliability. These goals are to ensure that enterprises do not take the “road”. When the Ministry of Finance elaborated the relationship between the five objectives of internal control, it believed that China's early internal control was aimed at achieving these three goals.

The second level of the goal-oriented internal control index model is the management level. The internal control goal of this level is to improve the efficiency and effectiveness of the business. The goal is to ensure that the company is on a “good road”. The business management level objectives are based on the basic level. If the company violates laws and regulations, assets are not safe, and the report is unreliable, it will necessarily mean that the loss will occur. In the end, it will be reflected in the specific form of fines, compensation or asset impairment. Operating efficiency or effectiveness. Management-level objectives require companies to optimize processes, improve organizational efficiency, and maximize operational efficiency and effectiveness.

The third level is the strategic level. The internal control goal of this level is to realize the enterprise development strategy, which requires the enterprise to achieve sustainable development, continuously create enterprise value, and guide the enterprise to take the 'right path' (take the right path). Strategic level The goal is based on the basic level and the management level goal. To achieve the strategic goal is to maintain the survival and long-term development of the enterprise.

From the perspective of time, the basic level is more about the past, the business level is focused on describing the current state of the enterprise, and the strategic level is mainly looking into the future. The score of the basic level index is higher, indicating that the enterprise is “not bad”, and the score of the management level index is higher, indicating that the enterprise is a “good enterprise”, and the strategic level index has a higher score, which means that the enterprise road is right (positive road).

V. Target-oriented internal control index construction According to the index construction framework, around the index level, this section elaborates on the connotation of each internal control target, the basis of index selection and index preparation for each internal control specification (2010). Method, construct a goal-oriented internal control index.

Legal compliance emphasizes that an enterprise should conduct business activities within the business scope permitted by law, and it is strictly forbidden to operate illegally or illegally. Considering the institutional background and the availability of data in China, this paper selects three indicators of violation of laws, case investigation and corporate litigation to measure the degree of achievement of legal compliance objectives.

If the listed company is punished by the regulatory authorities such as the China Securities Regulatory Commission, the China Banking Regulatory Commission, the China Insurance Regulatory Commission, the Securities Regulatory Commission, the Exchange, or other environmental protection, taxation, industrial and commercial supervision departments, it indicates that the listed company has violated relevant laws and regulations and failed to guarantee the business operations. Manage legal compliance. Therefore, if the listed company is punished by the regulatory body, the Complican is assigned a value of -1; if it is not punished, the Complicance is assigned a value of 0. Since the government regulatory agency suspects that the listed company is suspected of violating the law, it takes a long time from the investigation to the final settlement. Some complicated cases can take two to three years. Taking into account the above situation, this article will use the regulatory agency's investigation of listed companies as suspected violations. If the regulatory agency investigates the listed company, Comp1icance2 is assigned a value of -1, otherwise it is 0. Lin Bin et al. (2013) found that the company litigation is negatively correlated with the quality of internal control. In view of the company's failures and pending complaints, the company will face financial risks and reputational risks. This article will include these two types of litigation matters into the indicator system. If the enterprise has outstanding complaints, the Comp1icance3 value is -1; if the enterprise has a losing case, Comp1icance3 is assigned a value of -2; otherwise, it is 0. COSO (2013) regards asset security as a sub-goal of the business target, and China's basic The specification clearly states that asset security is the five major goals of internal control. Asset security mainly refers to preventing the loss of assets. This loss may be caused by misappropriation, misappropriation, theft or waste. It may also be caused by mistakes or mistakes in business decisions, such as improper expansion of commercial credits, resulting in bad debt losses. , a large inventory of backlogs resulting in impairment, investment failure losses.

According to the connotation of asset security objectives, this paper measures the realization degree of asset security objectives from three aspects: asset impairment, investment loss and adjusted non-operating expenses.

Asset impairment indicators describe the loss of assets caused by mistakes or mistakes in business decisions from the perspective of business operations. The company's provision for asset impairment is due to the company's low performance, horizontal competition and changes in business strategy, resulting in lower asset value (Dai Bingbin et al., 2007), which reflects the loss of assets caused by mistakes or mistakes in the company's business decisions. The asset impairment of this paper includes impairment provision for various assets such as enterprise accounts receivable, inventory, fixed assets and intangible assets. Calculating the score of the asset impairment indicator goes through two steps: First, improving the operational efficiency and effectiveness according to the public management level index is an important goal of the internal control of the enterprise. He Chuanqi (1992), when expounding the difference between the concept of efficiency and effect, believes that efficiency pursues higher output per unit time; and effect pursues the least input and produces the largest output. Drucker (1988) believes that companies must not only do things right (todothingright), that is, to pursue efficiency, but also to do the right thing (togettherightthingdone), that is, to pursue results. Wu Junmin et al. (2007) argue that benefits include efficiency and effectiveness. Benefits are the ultimate goal of management and the ultimate criterion for judging management success or failure (Harold and Heinz, 1988). According to the above concepts of efficiency, effect and benefit, this paper selects the total asset turnover rate to measure the efficiency of enterprises, the per capita operating income measures the effect of enterprises, and the return on net assets measures the efficiency of enterprises, which comprehensively reflects the efficiency and effect of enterprises; these three indicators are respectively The three perspectives of assets, labor and capital reflect the operational efficiency and effectiveness of the company.

The total asset turnover rate is based on the 'Accounting Accounts and Major Accounts Processing' section of the Accounting Standards for Business Enterprises. The public welfare donation expenditure should be included in the non-operating expenses accounting, but the public welfare donation is the enterprise. The subjective behavior, it does not belong to the loss of assets caused by misappropriation or decision-making mistakes, so this article excludes this expenditure when calculating the adjusted non-operating expenditure indicators.

When the company's financial statements are issued with negative opinions or cannot express opinions, it indicates that the financial statements as a whole are unfair, there may be significant misstatements, or the scope of the CPA's audit is limited, and its possible impact is significant and extensive. Explain that the company may have significant defects. This article uses the negative opinions and unreportable opinions of the financial statements as amendments to the internal control index.

The total asset turnover rate measures the operating efficiency of the company. A higher asset turnover rate indicates that under a given asset size, the company generates more operating income and cash flow during the time period, indicating that the management is working hard and the operating efficiency is high; the lower asset turnover rate indicates management. Layers may invest assets in non-productive activities, reducing operational efficiency and damaging corporate value (Singhand Davidson, 2003). Calculating the score of the total asset turnover rate indicator goes through two steps: First, through the public strategy level index enterprise strategy is to determine the corporate mission and corporate goals, according to the external environment and its own resources and strength, choose the appropriate business scope, competition mode and built in accordance with orange squad with great courage ifififPhPhPhififPhPhPhPhifPhPhPh is a marriage with great courage PhPhPhifififPhPhifPhPhPhPhififPh flood demon ifififPhPhPhPhPhPhPhPhPhPhPhPhPh index illegal investigation corporate litigation asset impairment loss of investment adjustment of operating expenses financial statement audit opinion restatements of earnings quality total asset turnover ratio of net assets per capita operating income Revenue business plan competitive advantage system risk running snow safety report reliable sister candied m correction index index level basic level management level strategic level goal 嵘 尉, :: 本迸目+压明嵘骚尉年芬芬目-i mesh gown with 5 bamboo brush for utensils provision Ying Wei Di split bamboo brush for utensils when s5 provision Ji Wei Ying gown and Di barge when d: systemic risk characterization results after the corporate strategy. Systemic risk management is an important part of corporate strategic management. The more successful a corporate strategy is, the smaller the system risk will be (Thompson, 1984). This paper uses the reduction in beta coefficient to measure the reduction in systemic risk. The internal control defect of the beta coefficient is a negative dimension for evaluating the effectiveness of internal control. The important defects and major defects of internal control may cause the enterprise to seriously deviate from the internal control objectives. They include internal control audit reports issued with reservations and negative opinions. There are important defects and major defects in the internal control of corporate disclosure. The financial statements of the company are issued with negative opinions and cannot express opinions. Drawing on the research of the research group of China's listed companies' internal control index (2011), this paper regards internal control important defects and major defects as internal control correction indicators.

In summary, the goal-oriented internal control index consists of a basic level index, a business level index, a strategic level index, and a revised index, with a total of 16 indicators. The indicator system and its corresponding basis are shown in Table 1.

In the preparation of the internal control index, the index weights need to be determined. The weight of the index reflects the degree of influence of each indicator on the comprehensive evaluation, and plays a pivotal role in the comprehensive evaluation. This paper uses a combination of subjective and objective methods to determine index weights.

Drawing on the research of the research group of China's listed companies' internal control index (2011), this paper converts the scores of each indicator into a thousand-point system. According to the index weight, the goal-oriented internal control index is calculated using formula (19), where BasicLevel is the base level index, OperationLevel is the management level index, and StrategyLevel is the strategic level index. If the company has significant defects or major defects, correct the results calculated by equation (19).

This paper starts from the practice test standard, designs the goal-oriented internal control index around the realization degree of internal control objectives, provides the internal control construction for listed companies, provides the basis for the supervision department to evaluate the internal control level of listed companies, and promotes the development of internal control empirical research. .

Due to space limitations, this paper does not use the goal-oriented internal control index to empirically analyze the status quo of listed companies' internal control, and test the validity of the index, which needs to be further expanded and improved in future research. In addition, there may be many other problems in the research of this paper. I hope that through the introduction of jade, it will lead to more thinking and discussion on the construction of China's internal control index.

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