• ISSN: 2010-023X (Print)
    • Abbreviated Title: Int. J. Trade, Economics and Financ.
    • Frequency: Quaterly
    • DOI: 10.18178/IJTEF
    • Editor-in-Chief: Prof.Tung-Zong (Donald) Chang
    • Managing Editor: Ms. Shira. W. Lu
    • Abstracting/ Indexing:  Crossref, Electronic Journals Library , EBSCO
    • E-mail: ijtef.editorial.office@gmail.com
IJTEF 2017 Vol.8(6): 239-244 ISSN: 2010-023X
DOI: 10.18178/ijtef.2017.8.6.572

Research on Evaluation of the Efficiency of Internal Control of State Owned Listed Corporation Based on DEA

Shi Qiu, Hongqu He, Hongwei Guo, and Xi Huang

Abstract—Most listed corporations evaluated the effectiveness of internal control following the passage of the Sarbanes-Oxley Act of 2002(SOX) at the expense of the unprecedented assessment cost. But the quality of internal control rests with effectiveness and efficiency of internal control. Hence this paper puts forward the DEA method to evaluate efficiency of the internal control in China State-owned Listed Corporations. The empirical research finds that the efficiency value of internal control based on DEA method is fine generally except the wasting in the pure technology efficiency (PTE) and scale efficiency (SE). In addition, the DEA-based evaluation result is inconsistent with the DIB index, which is one of the predominant internal control indexes in China. Since these two strategies cannot be compared directly, we compare them with auxiliary of Tobin Q by the similarity computation. The results indicate that the DEA index outperforms the DIB index from the perspective that the good internal control should improve the enterprises’ value while the bad one would not.

Index Terms—Internal control, operational efficiency, DEA, Tobin Q.

Shi Qiu and Hongqu He are with the Bussiness School, Central South University, Changsha, Hunan, P. R. China (e-mail: 121601049@csu.edu.cn), Shi Qiu is also with the School of Economics and Management, Changsha University, Changsha, Hunan, P. R. China.
Hongwei Guo and Xi Huang are with the School of Economics and Management, Changsha University, Changsha, Hunan, P. R. China.

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Cite: Shi Qiu, Hongqu He, Hongwei Guo, and Xi Huang, "Research on Evaluation of the Efficiency of Internal Control of State Owned Listed Corporation Based on DEA," International Journal of Trade, Economics and Finance vol.8, no.6, pp. 239-244, 2017.

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