Risk is possibility of loss can be intentional or un-intentional.Risks associated with e- commerce transactions are high compared to general internet activities.

Risk includes the following:

• Problem of anonymity:There is need to identify and authenticate users in the virtual global market where anyone can sell to or buy from anyone.
• Repudiation of contract: There is possibility that the electronic transaction  in  the form of contract, sale order or purchase by the trading partner or customer maybe denied.
• Lack of authenticity of transactions: The electronic documents that are produced during an e-Commerce transaction may not be authentic and reliable.
• Non-recognitionofelectronic transactions: e-Commerce transactions, as electronic records and digital signatures may not be recognized as evidence in courts of law.
• Quality issues: There are quality issues raised by customers as the original product differs from the one that was ordered.
• Problem of piracy: Intellectual property may not be adequately protected when such property is transacted through e-Commerce.
• Delay in goods and Hidden Costs: When goods are ordered from another country,  there are hidden costs enforced by Companies.
• Needs Access to internet and lack of personal touch: The e commerce requires an internet connection which is extra expensive and lacks personal touch.
• Infrastructure: Not only digital network, There is a need of other infrastructure like roads and railways are required for faster delivery.
• Denial of Service: Service to customers may be denied due to non- availability of

system as it may be affected by viruses etc.

• Lack of audit trails: Audit trails in e-Commerce system may be lacking and the logs  may be incomplete.
• Data Loss or theft or duplication: The data transmitted over the  Internet  may  be  lost, duplicated, tampered with.
• Security and credit card issues: There is cloning possible of credit cards and debit  cards which poses a security threat.
• Attack from hackers: Web servers used for e-Commerce maybe  vulnerable  to  hackers.
• Privacy and Security: Issues of security, hacking and security concerns.

CONTROL

• Internal control, as defined in accounting and auditing, is a process for assuringachievement of an organization’s objectives in operational effectivenessand efficiency, reliable financial reporting, and compliance with laws, regulations and policies.
• For example:
  • Company may have a policy to force employees to change their passwords every 30 days.
  • A CA firm may not allow office staff access to social sites during office hours.

COMPONENTS FOR E-COMMERCE

• User
• E-commerce vendors
• Technology Infrastructure
• Internet/ Network
• Web Portal
• Payment Gateway

In an e-business environment, controls are necessary for all persons in the chain, including-

• Users: This is important to ensure that the genuine user isusing the e-commerce/ m- commerce platform. There is risk if user accounts are hacked and hackers  buy products / services.
• Sellers / Buyers / Merchants:  Many e-commerce businesses have lost huge amount  of moneyas they did not have proper controls put in place.
• Government: Governments across the world and in India have few critical concerns vis-à-vis electronic transactions, namely:
  • Tax accountingof all products / services sold.
  • All products / services sold are legal. There have been instances where narcotics drugs have found to be sold and bought through electronic means.
• Network Service Providers: They need to ensure availability and security of network.Any downtime of network can be disastrous for business.
• Technology Service Providers: These include all other service providerother than