Research on the Impact of Enterprise Digital Transformation on Internal Control

Chenxi Wang, Deli Wang (), Xincai Deng and Shun Wang
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Chenxi Wang: School of Economics and Management, Guizhou Normal University, Guiyang 550001, China
Deli Wang: School of Accounting, Guangdong University of Foreign Studies, Guangzhou 510006, China
Xincai Deng: School of Economics and Management, Guizhou Normal University, Guiyang 550001, China
Shun Wang: School of Business, Anhui University, Hefei 230601, China

Sustainability, 2023, vol. 15, issue 10, 1-18

Abstract: Digital transformation is a crucial strategy for enterprises to achieve improvements in quality, efficiency, and dynamism. It represents the key direction for enterprise innovation and reform, and it is also of great significance for promoting high-quality economic development. While the previous research has shown that digital transformation can affect business efficiency, performance, and corporate governance, there is a lack of literature clearly linking digital transformation to internal control. To determine whether enterprise digital transformation impacts the constructions and implementation of internal control, we analyze data from Shanghai and Shenzhen A-share listed companies between 2012 and 2019. Our study found that the extent of digital transformation in enterprises has a positive impact on the establishment and effectiveness of internal control. Furthermore, we examine the role of market competition in the relationship between the digital transformation and internal control. We found that the impact of digital transformation on internal control is limited in enterprises with relatively mild market competition, while in more fiercely competitive markets, the positive impact of digital transformation on internal control is more pronounced.

Keywords: digital transformation; establishment of internal control; effectiveness of internal control; market competition (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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