The effects of the internal control system on the risk, profitability, and compliance of the U.S. banking sector: A quantitative approach
基于COSO框架和巴塞尔委员会框架，量化内部控制要素，分析其对美国210家最大银行控股公司2013-2017年信用风险、盈利能力和合规性的影响。
Abstract This is strong quantitative research investigating whether and how the components of the internal control system affect the credit risk, profitability, and compliance of the U.S. banking sector. Based on the COSO Framework, Basel Committee Frameworks, and the literature, the components of the internal controls are quantified. This quantitative nature distinguishes this study from others in this field since most of the studies up to now have investigated these topics by theoretical approaches. Eleven independent variables are analysed in three different regression models, with credit risk, profitability, and compliance being the dependent variables in each model. After cleaning the data from outliers, several tests are performed, while a panel set of data is used comprising the 210 biggest U.S. bank holding companies. Fixed‐effects regression is applied in the three models, while the years under examination are the five fiscal years 2013–2017. Most of the data are taken from the proxy statements (DEF 14A) and the 10‐K statements because of their qualitative nature. The key results indicate that Risk Assessment, Control Activities, and Information and Communication components strongly affect credit risk. The first (Control Environment) and last (Monitoring) components have a significant effect on credit risk, though only from the perspective of the board's number and the expertise of the audit committee, respectively. In the same line, internal controls significantly affect the profitability and compliance of U.S. banks, except for the Risk Assessment component in the first case and the Control Environment component in the second case, respectively. Control Activities component and the Information and Communication component have a significant and positive relationship with the banks' profitability, while these two components are significantly and negatively correlated with the banks' compliance.