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

Abstract

AbstractDebt 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.KeywordsInternal controlDebt financing cost. Corporate debtFinancing costsData analytics