1. Dipanshu Allwani, cro0360720 1/20/2013 1

2. THE INSTITUTE OF
CHARTERED ACCOUNTANT OF
INDIA
Project Report Presented On The
Completion Of 100 hrs Of ITT
Training
Electronic Commerce
Presented By:-
Dipanshu Allwani
CRO 0360720

3. THE INSTITUTE OF
CHARTERED ACCOUNTANT OF
INDIA
CA Rahul Jain
Chairman

4. THE INSTITUTE OF
CHARTERED ACCOUNTANT OF INDIA
1/20/2013
ACKNOWLEDGEMENT
I Wish To Express My Deep Gratitude And Everlasting
Indebtedness To Our Guide Mr. Vishal Karanjiker & Mr.
MANOJ KORI SIR Whose Advise, Constant
Encouragement, Invaluable Suggestions And Expert
Guidance Were The Utmost Help In Completing The
Presentation Work In Prescribed Time. I Would Like To
Express My Gratitude To The Institute Of Chartered
Accountants Of India For Organizing Such A Training
Which Helped Me In Developing My Computer Skills. I Am
Equally Indebted To All Supporting Staff Members Of The
Institute Jabalpur Branch For Their Co-operation In
Completion Of My Training And Project.
Dipanshu Allwani
CRO0360720

5. 1/20/2013
Dipanshu Allwani, 5
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What Is a Commerce ?
Commerce refers to all the activities the purchase
and sales of goods or services.
Ex:- Marketing, sales, payment, fulfillment, customer
service
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 The race to 60 million users
 Radio—30 years
 TV—15 years
 The Internet—3 years to 90 million users
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8. 1/20/2013
Electronic Commerce (E-Commerce)
1. Electronic Commerce or e-commerce, the exchange of goods and
services by means of the Internet or other computer networks. E-
commerce follows the Is An E-Commerce ?
What same basic principles as traditional
commerce—that is, buyers and sellers come together to exchange
goods for money. But rather than conducting business in the
traditional way—in stores and other “brick and mortar” buildings or
through mail order catalogs and telephone operators—in e-
commerce buyers and sellers transact business over networked
computers.
2. E-commerce offers buyers convenience. They can visit the World
Wide Web sites of multiple vendors 24 hours a day and seven days a
week to compare prices and make purchases, without having to leave
their homes or offices. In some cases, consumers can immediately
obtain a product or service, such as an electronic book, a music file,
or computer software, by downloading it over the Internet.
3. Ecommerce can be broken into four main categories: B2B, B2C, C2B,
and C2C
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Types of E-Commerce
 B2B (Business-to-Business)
Companies doing business with each other such as manufacturers selling to distributors and
wholesalers selling to retailers. Pricing is based on quantity of order and is often negotiable.
 B2C (Business-to-Consumer)
Businesses selling to the general public typically through catalogs utilizing shopping cart
software. By dollar volume, B2B takes the prize, however B2C is really what the average Joe has
in mind with regards to ecommerce as a whole.
Having a hard time finding a book? Need to purchase a custom, high-end computer system? How
about a first class, all-inclusive trip to a tropical island? With the advent ecommerce, all three
things can be purchased literally in minutes without human interaction. Oh how far we've come!
 C2B (Consumer-to-Business)
A consumer posts his project with a set budget online and within hours companies review the
consumer's requirements and bid on the project. The consumer reviews the bids and selects the
company that will complete the project. Elance empowers consumers around the world by
providing the meeting ground and platform for such transactions.
 C2C (Consumer-to-Consumer)
There are many sites offering free classifieds, auctions, and forums where individuals can buy
and sell thanks to online payment systems like Pay Pal where people can send and receive money
online with ease. eBay's auction service is a great example of where person-to-person
transactions take place everyday since 1995.
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Advantages Disadvantages
• Being able to conduct • Time for delivery of
1 business 24 x 7 x 365. 1 physical products
• Access the global • Limited and selected
2 marketplace 2 sensory information.
• Privacy, security, payment,
3
• Speed identity, contract
3
• Opportunity to reduce • Perishable goods and
4 costs 4 Returning goods
• Stepping beyond borders • Physical product, supplier &
5 to a global view 5 delivery uncertainty
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 Internet
 Mobile technologies
 Web architecture
 Component programming
 Data exchange
 Multimedia
 Search engines
 Access security
 Data mining
 Cryptographic security
 Intelligent agents
 Watermarking
 Payment systems
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12. 1/20/2013
SELLERS CYCLE
IDENTIFY CREATE
CUSTOMERS ADVERTISING
PRODUCT
NEGOTIATE
SEND GOODS RECEIVE PAYMENTS
SALE
12
Dipanshu Allwani,
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BUYERS CYCLE
SEARCHES FOR
IDENTIFIED NEED SELECT A VENDOR
PRODUCTS
NEGOTIATES A
RECEIVES REPORT MAKES PAYMENT
PURCHASE
PROVIDES PERFORMS
USE PRODUCT
FEEDBACK MAINTENENCE
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Process Involved In E- Commerce
1. Attract customers
 Advertising, marketing
2. Interact with customers
 Catalog, negotiation
3. Handle and manage orders
 Order capture
 Payment
 Transaction
 Fulfillment (physical good, service good, digital good)
4. React to customer inquiries
 Customer service
 Order tracking
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 EDI is the computer to
computer exchange of
business between
companies.
 EDI replaces the faxing
BENEFITS OF EDI
and mailing of paper
documents. LESS EXPENSIVE
MUCH LESSER
LESSE ERROR
THAN HANDLING OCCURRED
 About 80,000
LABOUR IS
PAPER BECAUSE OF
REQUIRED
DOCUMENTS COMPUTER
companies have made
SYSTEM
the switch to EDI to
improve their
INSTANT
MORE RELIABLE LESS TIME
DOCUMENT
CONSUMING
RETRIEVAL
Efficiency.
Dipanshu Allwani,
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17. 1/20/2013
CREDIT
CARD
JOINT
ELECTRONIC ELECTRONIC
TRANSACTION CHEQUES
ELECTRONIC
PAYMENTS
ELECTRONIC SMART
PURSES CARDS
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Reduce
Greater Increase Simplified
Administrative
Security. Efficiency. Book Keeping
cost
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19. Brings Buyer and Sellers together for mutual
Satisfying transaction through online Market.
 Critical Mass of buyers and Sellers
 Interactivity.
 Negotiation And Bargaining.
 New Products & Services.
 Less Time Consuming.
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20. 1/20/2013
Card Association
Clearing house
5
6
7
4
Card Issuing Bank Acquiring Bank 3 8
1 2
Merchant
Customer Internet
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21. 1/20/2013
Suppose that you are a customer, now as a customer you will provide the card
number as part of the sale voucher to the merchant
Today customer ordinarily wipes the card through a magnetic reader. Merchant
may have the policy of checking on transaction above a certain amount with his
bank, which is called Acquiring Bank
The acquiring bank may complete a check that reaches all the way to your Card –
Issuing Bank
Assuming that the checking process is successfully completed the merchant then
submits the transaction to the acquiring bank and the settlement is made through
the Card Association – Clearing House
Now your account will be debited and merchant account will be credited and hence
the transaction is completed
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22. 1/20/2013
 The Good
 Faster, cheaper and less prone to error
 Customer centric
 The Bad
 Hardware issues…spotted owl disease
 False sense of organization
 Initial cost and implementation issues
 Emerging economy issues…haves and have-nots
 The Ugly
 The bad guys and hackers…our focus today
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cro0360720 22

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Dipanshu Allwani, 23
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Dipanshu Allwani,
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25. 1/20/2013
Audit Consideration In an E-commerce
Environment
The advent of web-based ordering and
operating systems increases the
challenges many auditors face when
auditing clients who are adopting e-
commerce strategies. E-commerce
produces new and more complex value
added models and in this process
several integrated applications are
developed and deployed at a rapid pace.
Therefore, it is important for the
auditor to understand the extent of
dependence of the business on e-
commerce and also its impact both on
the business model and operations.
Dipanshu Allwani,
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26. 1/20/2013
 Proactive posture
 On-going analysis and effort
 Defending the Digital Frontier, Mark Doll, Sajay Rai
and Jose Granado. Ernst & Young, LLP.
Dipanshu Allwani,
cro0360720
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28. 1/20/2013
Presentation by …….
DIPANSHU ALLWANI
(cro 0360720)
Feed back @
allwanidips@gmail.com
All the best…………………… 28