1. Accounting on the Internet
Chapter 2

2. Chapter 2: Accounting on the Internet
Introduction
The Internet and the World Wide Web
XBRL - Financial Reporting on the Internet
Electronic Business
Privacy and Security on the Internet

3. The Internet and World Wide Web
Internet Addresses and Software
Intranets and Extranets
The World Wide Web, HTML, and IDEA
Groupware, Electronic Conferencing, and Blogs

4. Internet Addresses and Software
Domain Address
Also called a Uniform Resource Locator (URL)
Internet Protocol (IP)
Numeric address of domain address
Transmission Control Protocol (TCP)

5. Intranets and Extranets
Based on same software as the Internet
Internal to the organization
Outsiders are unable to access information
Extranets
Enable external users to access intranets
Utilize passwords or private data communications channels

6. The World Wide Web, HTML, and IDEA
Multimedia portion of the Internet
Hypertext Markup Language (HTML)
Editing language
Used in design of web pages
Hypertext Transfer Protocol (HTTP)
Communications protocol used to transfer web pages

7. HTML Code

8. Display of HTML Code

9. Groupware, Electronic Conferencing, and Blogs
Allow users to complete numerous tasks electronically
Send and receive , collaborate on work tasks, schedule appointments, share files
Software include Exchange, Groupwise, Lotus Notes, and Outlook

10. Groupware, Electronic Conferencing, and Blogs
Instant Messaging Software
Remote users communicate in real time
Electronic Conferencing
Knowledge Management
Programs utilized to distribute expertise within the organization
Blogs
Collaboration tool
Create, share, and leverage knowledge

11. Social Networking and Its Value to Accountants
Commercial Utilization
Increase organization recognition
Public reaction to launch of new product
Developing an online presence
Seeking new clients
Communicate on projects
Identify consumer anger

12. Study Break #1
Which of the following is most likely to contain only numbers?
Domain address
URL address
IP address
Postal address

13. Study Break #2
Which of the following enables users to view data with a web browser?
Intranet
Extranet
Internet
All of these

14. XBRL - Financial Reporting on the Internet
eXtensible Markup Language (XML)
Similar to HTML
Users define their own tags
XML tags describe the data
eXtensible Business Reporting Language
Tags are standardized for business reporting purposes

15. XBRL Code

16. XBRL - Financial Reporting on the Internet
XBRL Instance Documents and Taxonomies
Must understand the standard tags
Must understand the rules that govern the use of the tags
Current Status of XBRL
XBRL International Consortium

17. How XBRL Affects Accountants

18. XBRL - Financial Reporting on the Internet
The Benefits of XBRL
Transmit financial data in standard format
Data items are uniquely defined
Searching for tags is easier (IDEA)
Data is self-checking
Automatic and reliable exchange of financial information
Companies are not constrained to specific formats

19. XBRL - Financial Reporting on the Internet
The Drawbacks of XBRL
Requires new users to learn, and conform to, the standards of the language
Evolving standards require conformity to changing specifications
No requirement for auditors to provide assurance
Costs of transition

20. Study Break #3
All of the following are markup languages (that use edit tags) except:
HTML
BYTE
XML
XBRL

21. Study Break #4 A document file containing XBRL tags is a(n):
Extranet document
Intranet document
Instance document
URL

22. Electronic Business Definition
Conduct of business with computers and data communications
Categories of Electronic Commerce
Accounting
Retail sales
E-payments and E-wallets
Electronic data interchange
Cloud-computing services

23. E-Accounting Performing accounting functions on the Internet
Preparing financial reports
Completing income tax returns
Preparing budgets
Writing reports
Publishing financial information

24. Retail Sales Overview Problems with Internet Retail Sales
Virtual stores to sell directly to customers
Automated AISs
Problems with Internet Retail Sales
Legitimacy of web sites
Reliance upon s
Reliance upon suppliers
Click fraud
Privacy concerns

25. Advantages of Virtual Stores

26. Retail Sales Privacy Concerns Annoying e-mail Credit card information
Sensitive information (example – Rx)

27. E-Payments and E-Wallets
Faster, easier, and safer way to handle online transactions
E-payment service acts as intermediary
E-Wallet
Store consumer’s personal information
Customers pay for purchases by providing their
e-wallet account numbers

28. E-Payment System

29. Virtual Currency Medium of exchange that operates
Beyond restriction of a particular country
Beyond monetary policies
Example - Bitcoin

30. Virtual Currency Retailers accept virtual currency
Ability to do more business
Ease of electronic transactions
No need for credit card middlemen or check clearing houses
Near-instantaneous credit of transactions to corporate accounts
Consumer wallets cannot be frozen
No transaction fees

31. Virtual Currency Risks with virtual currency
Potential devaluation of currency in response to market forces
Transactions are not independently auditable
Earlier virtual currencies have failed
Unwillingness of others to accept it

32. Business-to-Business E-Commerce
Definition
Businesses buying and selling goods and services to each other over the Internet
Advantages
Shortens time from purchase to delivery
Expanded variety of vendors
Reduces processing costs
Wider availability of real-time data

33. Electronic Data Interchange
Transmit information over high-speed data communications channels
Automates exchange of business information
Advantages
Ability to fax documents
Can include handwritten signatures
Ability to exchange graphic and photographic documents

34. Cloud Computing Processing Services Platform as a Service (PaaS)
Storage and Backup Services
Maintain copies of critical data
Educational Services
Research and using specialized web tutorials

35. Advantages of Cloud Computing

36. Privacy and Security on the Internet
Definition
Using another person’s personal data that involves fraud or deception
Identity Theft and Assumption Deterrence Act of 1998 (ITADA)
Company Prevention
Use preventive controls
Exercise reasonable caution to protect personal information

37. Safeguarding Personal Data

38. Security
Safeguarding electronic resources and limiting access to authorized users
Access Security – Authentication
What you have – plastic card
What you know – unique information
Who you are - fingerprints

39. Spam and Phishing Spam Unsolicited e-mail messages
Increasingly costly to organizations
Phishing
Websites requesting personal information from consumers
Most information is typically stored in AISs

40. Firewalls Purpose Two Primary Methods Problems
Guards against unauthorized access
Stand-alone devices and/or software
Two Primary Methods
Inclusion – Access Control List (ACL)
Exclusion
Problems
Denial-of-Service Attacks
Spoofing

41. Firewall Example

42. Intrusion Detection Systems
Passive IDSs
Create logs of potential intrusions
Alert network administrators
Reactive IDSs
Detect potential intrusions dynamically
Log off potentially malicious users
Program firewalls to block messages from suspected source

43. Value-Added Networks Definition
Private, point-to-point communication channels
Usually created for security purposes
Methods of Creation
Blank slate, create from scratch
Lease secure, dedicated transmission lines
Create a Virtual Private Network (VPN)

44. Virtual Private Networks
Definition
Similar to VAN
Transmit messages over existing Internet connections
Creating Secure Data Transmission
Use “tunneling” security protocols
Encrypt transmitted data
Authenticate remote computer

45. VAN-based EDI System

46. Proxy Server Definition Network server that controls web access
Advantages
Funnel internet requests through a single server
Examine and test requests for authenticity
Limit employee access to approved websites
Limit stored information
Store frequently-accessed web pages (Cache)

47. Data Encryption Definition
Transform plaintext messages into unintelligible cyphertext messages
Encryption key
Mathematical function dependent upon a large prime number
Data Encryption Standard (DES)

48. Simple Data Encryption

49. Data Encryption Secret Key Cryptography
Users must keep the key secret and not share the key with other parties
Public Key Encryption
Each party uses a pair of public/private encryption keys
SSL and S-HTTP

50. Digital Signatures and Digital Time Stamping
Encrypted portion of message
Digital Signature Standard (DSS)
Digital Certificate
Certificate Authority
Digital Time-Stamping Services (DTSSs)

51. Study Break #5 Which of these statements is correct?
A VPN is a type of VAN
DES stands for “data entry system”
An IDS is the same as a firewall
All of these statements are correct

52. Study Break #6 Spoofing means: Kidding someone about their firewall
Simulating a disaster to test the effectiveness of a disaster recovery system
Posing as an authentic user to gain access to a computer system
Encrypting data for security purposes