Analysis of financial control analysis

Abstract: The international financial crisis, China's money market liquidity weakened, many businesses financing difficulties or even bankruptcy. Inadequate financial control system is the existence of serious problems of Chinese enterprises through the use of the overall internal control framework thinking (COSO theory ) to explore the Chinese company's financial control environment, control activities, in order to improve China's financial management system to improve internal control, improve the financial control system.

Keywords:: financial control, COSO theory, control system

financial crisis and now have the better of national economies, but many problems have not been fundamentally resolved, such as corporate financing and Investment control, asset preservation and appreciation of control. Gome event also attracted academic and social depth of corporate governance discussion, helping the company achieve the goal of building the financial control system has very important significance.

First, the financial control of research purposes
PTMenzies made in 1986 the concept of financial control, he believes, is the role of financial control at all times to assist managers to do the right thing, its goal is to first get through the financial control and reliable Information to make management more effective , followed by financial control also aims to understand the actual situation and plan deviations and take corrective action to correct the error, need to modify the plan when necessary to achieve our goals. and he also made two means of financial control: budgetary control and cost control.

In Chinese enterprises of different property rights to coordinate the financial goal orientation differences, integration of a wide range of enterprise property rights on the basis of good internal financial control of the main issues such as multiple, as soon as possible for property to build a diversified financial control mechanisms.

Second, the status of China's financial control
As China's market economy continues to mature, domestic financial deepening study of control problems, Chinese enterprises are common following questions:
1 poor financial control environment (1 set unreasonable financial officer positions. Financial accounting aspects of the paid-up capital, paid-only service payment and other matters like business matters in the financial data in one embodiment, since these businesses do not to the actual risk control, influencing the financial risk control and financial management functions of play. (2 basic units of financial institutions to set unreasonable in the current management model, many companies do not set the basic units of special financial sector, its lack of financial risk control measures is very serious because of personnel management authority, monitoring tools and other reasons, can only be achieved indirectly, after the monitoring, prevention can not achieve effective risk control effect.

2 Financial risk assessment system is imperfect. Some companies because long production cycle, and high costs, resulting in high rates of assets and liabilities, financial risks. In addition, most of the subsidiaries are separate legal personality, borrowed funds are often not to headquarters for approval, so there is very difficult financial risk control, the company's risk assessment system is imperfect. The reasons are: (a risk management system is not perfect, most companies are established risk management systems are mainly related to financial risk management mainly the lack of product Development, marketing system, complete (2 lack of risk accountability system, when the company after experiencing the shocks, the lack of risk accountability system, through various forms of liability can not be bound by restrictions and regulate the internal personnel, weakening and deterioration of the corporate management responsibility blurred, the ability of employees to cope with risks lagging behind in the corporate risk management standards.

3 weak control of financial activities. (An asset management system is imperfect. There is fragmentation of capital controls, responsibility centers are not strictly for cash management. A lack of Investment capital for existing direction or strategic reserve, resulting in idle and waste of funds, and in the financial payment and settlement procedures, the can not be completely in accordance with its approved system and implementation of the plan, although the establishment of a centralized accounting system, but there are still some responsibility center cycle of unlisted funds (2) the budget management system is imperfect, while the current budget management model led to the implementation of flexible budget relatively poor because of some units of the specific budget targets by the people responsible for developing, making the lack of scientific and financial budget, to the company's operating and financial management has brought more unpredictable risk (there are 3 financial control implementation process vulnerability.'s financial control measures have been mainly working in financial positions grouped, responsibilities and financial authorization and approval system to contain the basic system of financial control in the implementation process is detrimental to the control of the detailed implementation, nor a system of coordination between the role of integrated control, there is decentralized control, the standard non-standard problems.

4 poor communication of financial Information, Information and communication exists in all business activities, many companies only the accounting department, no financial management, some people mistakenly think is responsible for accounting is the financial, accounting department should be responsible for the Investment, matters such as financing and income distribution business from the accounting department. and these businesses have experienced a large time span, using special methods, the result is that not only affects the quality of financial Information has led to weak financial management degree, but also for the charge of finance responsible person, based on needs and performance of financial revenue and expenditure needs of a fictional accounting Information to provide an opportunity, not from the perspective of the entire system of financial control of the company.

5. Inadequate financial control system (1 internal audit systems, and internal auditors responsible only to the manager, the choice of auditing objects affected by the subjective views of the relative strength, reducing the efficiency of internal audit work, the unit is not conducive to financial control the construction and improvement, is not conducive to the company's overall financial control system implementation. (2 performance evaluation system is not comprehensive. performance evaluation index system are the people responsible for assessing the effectiveness of the year, so easy to simply create the current company-owned units interests, without considering the long-term interests, tends to produce short-term business enterprise responsible behavior, and performance evaluation indicators distortion may affect the long-term Development.

Third, suggestions for improvement of financial control system
COSO model including the control environment, risk assessment, control activities, information and communication and supervision in these five areas in the COSO released <<Internal Control - Integrated Framework "that is" COSO Framework ", the tendency of theorists began to use the COSO framework for financial control study, Steven J. Root (2004) <<go beyond the COSO>> a strict framework of the system so that company executives and leaders of financial control functions into a valuable strategic tool, which balance of forces in order to improve company performance is especially outstanding.

Financial control as an important component of internal control, research and operation of the process, are inseparable from the company's overall internal control system planning and operation, the final implementation of the results are also subject to various internal and external factors that impact in order to achieve the most good control effect, must be in the control environment, risk assessment, control activities, information and communication, and supervision aspects, as well as coordination between them are in good condition on any aspect of the lack of control activities will result in effect of reduction or even invalid.

(An improvement of the company's financial control environment
Corporate governance structure is the most important financial control of the control environment for the establishment and implementation of financial controls to provide system-based company's improved financial control system should be to improve the general meeting of shareholders, the general manager, management, business and other top-down, from outside to inside of one full-coverage style consistent supervision chain of bad conduct comprehensive supervision, corporate governance and internal control guidelines for the effective convergence center for the financial functions in the corresponding improvements.

1 person in charge of the identification of financial responsibility and authority. Group sent to their subordinate units can be taken to Chief Financial Officer, building a financial controlling system. Finance Department is under the leadership of the responsible persons in work, hard to bear on the leadership and the various departments control functions. according to enterprise branch offices and subsidiaries with the affiliation between the management authority, level-appointed Chief Financial Officer at all levels, in addition, the company should also establish the matching of the system, such as the appointed Chief Financial Officer the qualification, performance appraisal, reward, report, debriefing, training and rotation system, so as to ensure a smooth implementation.

(2) improve the financial staff of professional quality. Accountant for many years in China's history, proved that it strengthen financial supervision to prevent distortion of accounting information and economic efficiency have played a positive role in strengthening the accounting services functions and objectives of management responsibility (1 clear financial officer duties and powers, to strengthen the delegated administration. the right to appoint staff training, clear responsibilities, authority and relationship with the unit was assigned, perform their duties properly (2 quantitative assessment of the implementation of the system, strict performance evaluation by the assigned unit and assigned to units of common assessment, the accreditation body based.

(3) Strengthen management of financial institutions. The object of the enterprise financial management, capital movements, financial functions and financing, use and distribution of a series of activities linked to, as the accounting and business services sub-system as a support subsystem Finance has its own functional areas, if artificially placed in an institution in its implementation of the merger is clearly contrary to the scientific management theory should be in the subsidiary companies to promote the dual system of financial institutions, specifically the two functions.

(B to improve the company's financial risk assessment system
Risk assessment refers to the identification and analysis of relevant risks, is to discover and analyze the risks that affect the process of achieving the target company in the business process is divided into the risks arising from internal and external risks, to improve its assessment system is mainly to improve its internal and external risk assessment.

1. Improve the company's internal risk assessment. For the daily financial risk, specific measures are as follows: (a risk assessment to develop management objectives. Risk assessment is a prerequisite for the establishment of management targets, only the first set of objectives, management can identify risks and target take the necessary actions to manage risk and (2 set up an independent risk management committee in each business unit, select a solid theoretical foundation, abundant practical experience in risk management committee composed of the clerk, if necessary, should employ risk assessment and risk management experts, by the company's risk analysis and assessment, proposed risk analysis report (3 to important business processes, implementation of a comprehensive risk assessment risk identification should be carried out in a systematic way to ensure that all major activities of the organization and its risks are include in, and effective classification risk database is the basis for risk assessment, assessment of control activities is the starting point of the identified risks using qualitative or quantitative methods of risk analysis is to determine the importance of internal control assessment priorities.

(2) improve the company's external risk assessment. The company's external audit external risks are risks and tax-related risks, the need to strengthen the management and prevention (1) tax-related risks should regulate their subordinate units of tax-related work to clarify responsibilities, and standards as the main focus. Strictly units in accordance with the provisions of the local tax authorities to declare the tax schedule, and actively communicate with the local tax authorities, tax staff training on a regular basis, to grasp the changes in local tax policy to the company feedback, to do with the tax administration's Treasury work. (2 external audit risk the company to accept the external audit process, on the one hand, to improve control activities through the financial basis of the quality of financial information, on the other hand, the company's internal control center should be to strengthen the internal control system for the construction of the internal control coordinate the activities of management, to assess the effectiveness of internal control. Links to free download http://www.hi138.com (C to strengthen the company's financial control activities
Control activities is to ensure that management directives are implemented policies and procedures, financial control activities, we mainly on the financial budget, decision-making and corporate assets, control system analysis, control corporate control of the situation day to day financial activities, to produce data compared with prediction analysis of the data error, and the results of feedback control activities on the company ultimately made recommendations for improvement.

1. Strengthen the financial budget control. How to break the existing management system, eliminate the resistance, the implementation of new budget management model, the difficulty is obvious, the general idea is: improve the budget system is to create a long-term goals consistent with the actual situation, and with the company's overall financial management and business goals with the budget system, and connect the budget process should cover all levels.

2 strengthen the asset control (1 to strengthen the financial control by the majority of the company's financial management problems in the analysis, I believe that to strengthen the capital control should reduce the number of fund collection and strengthen its security and its main content : Set the clearing account, to strengthen financial management. to determine a clearing bank for the bank, the basic units of local banks to open only in a spending account for the various business expenses, income is no longer open accounts, the original income to repeal all accounts, the accounts opened into the Internet Banking system. norms job constraints, strengthen financial security for payment of funds operating in the areas of human risk, should be settled through a rigorous program to strengthen the position constraints to control (2) strengthen the control of fixed assets, fixed assets scale, especially for large group scattered layout of fixed assets, fixed assets accounting prone to bias, to strengthen the control of fixed assets, fixed assets management responsibility system should be implemented. The establishment of fixed asset management and centralized procurement review Committee, select the various business units composed of responsible management and centralized procurement review committee, responsible for all management decisions and centralized purchasing program approval, and guidance to the relevant departments of the asset management.

3 strict control of financial decisions. Corporate financial decision-making mainly refers to the Investment decision-making, accountability can be invested (1 set up the project team responsibilities, clearly responsible. Responsible person in charge of project preparation, negotiation, implementation and control of the whole process (2 the purpose of tracking and monitoring. Investment and Development Department should follow strict Investment projects monitoring, create a file for each Investment project, in-depth understanding of the progress the project unit to help solve the problems in project implementation (3 purpose assessment. Ltd. to the project feasibility study report assesses the economic indicators for the reference to its assessment. completion of the project completed or put into operation, the company will organize the social functions or hire professional Investment institutions to conduct special audit.

(D to strengthen the financial control information communication
Information control, mainly in its financial reporting and financial control of the network company is a large scale, multi-level, in order to understand the whole situation and, according to group to make decisions affecting the fate of group accounting software alone is not enough, the system efficient application of ERP, the management of the Group member companies have easy access to financial information and non-financial information, enabling the company a very good grasp of the information exchange application control, operational control and management control.

1. Speed ​​up construction of information and communication channels. Use of modern network technology in the existing computerized accounting system based on company-wide information delivery system in due course. Accelerate the process of application of ERP system, ERP system should make full use of the finished products to establish real-time dynamic monitoring system, and can provide timely branch sales offices and production-related data needed, further promote the company's accounting unit of accounting for all the information centralized management.

(2) establish a unified information system control system in the enterprise group level, the establishment of a reliable information on the control system, covering all the company's major activities. Including in electronic form and use of data storage systems, and security and must be independent oversight review. The internal control system to take full and comprehensive internal financial, operational and compliance aspects of the data, and on external markets and decision-making related events and conditions information to achieve financial assets, human resources, procurement, unified statistical information systems to the operational level.

(E improve the company's financial control monitoring system
Financial control system to achieve the company's supervision, the main form of internal audit, its functions should be focused on improving risk management and process control, and in a visionary manner serve as company consultant's role, and not confined to traditional method for historical data, although many companies set up the Audit Office, but the method still adhere to the traditional internal audit, improve supervision and financial control systems specific elements: (1 to strengthen the financial operation of the monitoring mechanism, according to job separation, principles of internal constraints among the different segments of the constraints on the supervision of a number of clearly defined, the system should be standardized through implementation, to ensure appropriate oversight role into full play the constraints, strengthen the financial sector between the work-related communication and control, to detect possible risks such as capital controls in the management of Weidazhangxiang, unusual costs, the accounting aspects of these cases can not discover, and discovered in the sectors of capital controls, the need for timely and accounting verified, false accounting adjustments correct accounting information. the financial sector should be improved for specific conditions within the inspection system, to eliminate the risks and deficiencies that may exist (2 results of periodic evaluation of financial control. assessment work before a clear purpose, develop work plans and specific assessment content, assessment process pay attention to timeliness and independence of evaluators and other factors, reflecting the company's financial controls by assessing the situation and found that the control deficiencies.

CONCLUSIONS
In summary, corporate financial control system construction and improvement is a systematic project, the control should be clear and unambiguous goals for the direction of a good financial control environment is the prerequisite to improve the financial control system as a platform, through reasonable and effective control procedures and methods to achieve the improvement of the financial control system.

Financial control is also a growing problem, the face of ever-changing and highly competitive market environment, companies are bound to the strategic objectives in changing from strategic objective to build a financial control system should be adjusted accordingly, need to use advanced financial controls, especially the application of information technology to enhance financial control, control of information technology to promote, improve management, enhance the core competitiveness of enterprises as a whole.

References:
[1] PTMenzies.Financial Control as an Aid to Management.Managementt Decision.1986.

[2] Spreadsheets and Sarbanes Oxley: Regulations, Risks, and Control Frameworks.Dr.Raymond R. Panko 2003.

[3] Steven J. Root. Beyond the COSO [M]. Liu Xiao-Lun, Beijing: CITIC Publishing House, 2004.

[4] Tang Rujun. On the large state-owned enterprise group financial control [J]. China's township enterprises accounting, 2009, (1).

[5] Ying iron for Analysis of corporate financial control [J]. Chinese business, 2009, (7

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