Accounting Information Systems: The Processes and Controls, 2nd Edition

E-BUSINESS SYSTEMS AND THE RELATED RISKS AND CONTROLS (STUDY OBJECTIVE 6)

Today, there are two popular types of Internet sales, commonly referred to as business to consumer (B2C), and business to business (B2B). B2C sales are those that most people are familiar with, whereby a retail or service firm sells directly to consumers using a website. This is also called e-commerce. B2B sales, on the other hand, involve companies using websites to sell products and services to each other. These types of sales transactions are known as e-business. A more detailed description of e-commerce and e-business is presented in Chapter 14.

There are numerous B2C examples, including Amazon.com, CDUniverse. com, Lands' End, J. Crew, and Delta Air Lines. In a B2C sale, the company's website and underlying network and software systems capture sales data, authorize credit card payments, and acknowledge the order via e-mail. The details such as customer, shipping address, items ordered, and credit card number are captured on the website and uploaded into the company's accounting and logistic software systems. The website must interface with the company's data on inventory, customer accounts, prices, and shipping charges.

B2B is not as well known by those in the general public. Like B2C, it involves the use of websites and the Internet to conduct business. The difference is that the transactions are between companies, rather than between a company and consumer. This difference is significant in several ...