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An Empirical Study of Internal Control and Corporate Debt Financing Costs—An Empirical Study Based on A-Share Listed Companies

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Applications of Decision Science in Management (ICDSM 2022)

Part of the book series: Smart Innovation, Systems and Technologies ((SIST,volume 260))

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Abstract

Debt financing has become one of the main ways of external financing for enterprises. As an important governance mechanism, the quality of internal control can not only reflect the level of the business risk of enterprises but also has a certain impact on the cost of debt financing. Therefore, this paper discusses the impact of internal control on debt financing cost, taking a-share listed companies from 2008 to 2016 as the research sample, using the internal control index of Dubo China-listed companies as the measurement index of internal control, to empirically test the proposed research hypothesis. The results show that the quality of internal control is inversely proportional to the cost of bank debt financing for listed companies. At the same time, according to the research content for the enterprises and the government to put forward targeted recommendations and policies. Also, guide the enterprise to raise funds effectively in the capital market.

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Acknowledgements

High-level Scientific Research Foundation for the introduction of talent, Grant/Award Numbers: FWKQJ202012.

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Authors and Affiliations

  1. School of Finance and Accounting, Fuzhou University of International Studies and Trade Fuzhou, Fuzhou, China

    Chingwen Wang

  2. Minjiang University, Fuzhou, China

    Fen Lin

Authors
  1. Chingwen Wang
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  2. Fen Lin
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Corresponding author

Correspondence to Chingwen Wang .

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Editors and Affiliations

  1. School of Business, Hunan International Economics University, Changsha, China

    Taosheng Wang

  2. School of Computer Science and Engineering, SOA University, Bhubaneswar, Odisha, India

    Srikanta Patnaik

  3. Department of Supply Chain and Information Management, The Hang Seng University of Hong Kong, Hong Kong, China

    Wu Chun Ho Jack

  4. Department of Production and Systems, School of Engineering, University of Minho, Guimaraes, Portugal

    Maria Leonilde Rocha Varela

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Wang, C., Lin, F. (2023). An Empirical Study of Internal Control and Corporate Debt Financing Costs—An Empirical Study Based on A-Share Listed Companies. In: Wang, T., Patnaik, S., Ho Jack, W.C., Rocha Varela, M.L. (eds) Applications of Decision Science in Management. ICDSM 2022. Smart Innovation, Systems and Technologies, vol 260. Springer, Singapore. https://doi.org/10.1007/978-981-19-2768-3_50

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