How Corporate Governance Shapes the Relationship Between Internal Control and Information Disclosure

Abstract

We investigate the relationship between internal control, corporate governance, and the quality of accounting information disclosure, companies listed on the main board in mainland China from 2015 to 2019. Using principal component analysis, ordered logistic regression, and other methods, combined with data collected from relevant databases and stock exchange websites, the relationship between internal control, corporate governance, and the quality of accounting information disclosure is explored. The findings are as follows: First, there is a positive correlation between internal control and the quality of accounting information disclosure. Second, corporate governance and executive shareholding can enhance the positive impact of internal control on the quality of accounting disclosure; however, a higher degree of equity checks and balances can weaken the positive effect of internal control on the quality of accounting disclosure. Third, in state-owned enterprises, a higher proportion of independent directors diminishes the positive correlation between internal control and the quality of accounting information disclosure. Through empirical research, this paper aims to provide recommendations for improving the quality of accounting information disclosure and contribute to the betterment of the capital market environment.

Received: 3 November 2024 | Revised: 7 March 2025 | Accepted: 26 May 2025

Conflicts of Interest 

The author declares that they have no conflicts of interest to this work.

Data Availability Statement

The data that support this work are available upon reasonable request to the corresponding author.

Author Contribution Statement

Meng Yuan: Conceptualization, Methodology, Software, Formal analysis, Investigation, Resources, Data curation, Writing – original draft, Writing – review & editing. Xinyu Hu: Validation, Investigation, Writing – review & editing, Visualization. Linggang Zeng: Resources, Supervision, Project administration, Funding acquisition.