The Electronic Frontier

Before jumping into WebTrust, CPAs should understand not only the problems with consumer online commerce that give rise to programs such as WebTrust, but also the Web logo services from non-CPA competitors. Although electronic commerce offers CPAs a chance to build on their experience, reputation and training, they need to understand some background before they proceed. No one article, or even one book, can explain everything CPAs. need to know about online commerce, but this article explores several key areas in the current e-commerce landscape. LEARN TO TRUST Although the estimates vary widely from different research organizations, Forrester Research, Inc. (www.forrester.com), a market research company that specializes in information technology and e-commerce, estimates that buyers and sellers exchanged $8 billion over the Internet in 1997 and will exchange well over $100 billion by the year 2000--a trend that poses ample opportunities for CPAs. According to the AICPA special committee on assurance services, the e-commerce assurance market for CPAs could grow to between $2 billion and $11 billion annually over the next few years (www.aicpa.org/assurance/index.htm). Although e-commerce is exploding, both buyers and sellers voice concerns about conducting business on the Internet. Many customers and business owners still distrust the process of e-commerce. They also may have a number of concerns about their potential trading partners--trading partners that they may never have dealt with previously or even communicated with other than by the Web or e-mail. Indeed, research published earlier this year by CommerceNet (www.commerce.net), a not-for-profit industry association that promotes e-commerce, confirms that a lack of trust is one of the top issues identified by market participants as preventing e-commerce from growing as fast as it otherwise could. While e-commerce is increasing, trust concerns, too, have actually risen over the last year, suggesting that this problem will not decline merely as people become more familiar with doing business on the Internet. Customers are wary because many questions remain unanswered about online stores, such as the following: * Is this a real company? (The authentication problem.) * Is this a trustworthy company? (The reputation problem.) * If I send credit card or bank information, is it safe? (The payment problem.) * If I provide information to a company on its Web site, where will the information end up? (The privacy problem.) * If I place an order, will I receive what I asked for? * Will I receive delivery when promised? * Will any problems I have be resolved quickly? * Is the money-back guarantee honored? * How soon will I get credit for returned items? * How quickly will the company perform service on warranty items? * Will the company be able to send me necessary replacement parts quickly? CPAs, by virtue of education and experience, are in an excellent position to provide assurance to consumers on these questions and thus remove some of the obstacles hindering further growth of Internet commerce. LOGO ASSURANCE SERVICES WebTrust is not the first attempt at answering these questions. In the past few years, logo services or logo programs have been used to build trust between e-commerce trading partners. Essentially, if a seller fulfills a set of criteria specified by an assurance provider, it can place the providers logo on its Web site. The logo offers reassurance to concerned buyers that the seller meets the standards established by a trusted third party Typically, the logo itself is tamper-resistant and is linked to the assurance provider's site, where the user can go to find out more detailed information about the meaning and scope of the logo service. CPA WebTrust is one of several logo services. …