Digital transformation is here to stay, and the pace of change is growing ever more rapid. Nonetheless, research shows that the majority of organizations still receive most of their invoices in paper or scanned forms.
According to Oxford University, many jobs in the invoice processing area will become automated by 2035. What are the most important reasons for automation of e-invoicing processes? The range of benefits includes internal optimization (cost and error reductions), the needs of business partners, and compliance with legal requirements (both international and local).
The benefits of e-invoicing are obvious, so why are so few of the world’s business invoices digital?
Many companies mention that migration to digital invoicing is a difficult process, especially if it concerns a lot of different suppliers. Moreover, almost every organization is seeking new ways to improve invoicing compliance. According to a survey by Comarch, more than half of all firms underline ensuring tax/VAT compliance and the integrity of invoice content as major compliance challenges.
Legal Rules and Challenges
And more countries are implementing mandatory electronic invoicing for private businesses. Starting from January 1 2019, e-invoicing for B2B will be mandatory in Italy. Electronic invoices will have to be transmitted via SDI (Sistema di Interscambio) in Fattura XML format. Unlike for the B2G flow, there is no obligation to sign e-invoices electronically in the B2B flow, but this is still recommended. The invoices have to be stored in an electronic archive for 10 years. Other countries are planning to implement such regulations, with Hungary and Portugal among those preparing to automate invoice processing.
The biggest issue for businesses is legal compliance for global invoicing, as each country has different rules. Businesses operating internationally need a global provider to help them navigate these regulations. Effective platforms will have a multilingual service desk and the ability to operate in multiple countries by processing e-invoices in accordance with local regulations. This should include validating content, ensuring the correct formatting of invoices, and transmitting data securely while allowing authorized constant access to the invoice’s status. A centralized platform fully streamlines and automates the accounts payable and accounts receivable (AP/AR) processes.
Legal compliance is one of the most important issues, but to achieve real added value and improve invoicing operations noticeably, the solution needs a comprehensive approach. Many large companies consider the automation of electronic invoicing as part of the holistic procure-to-pay or order-to-cash process rather than as a stand-alone activity.
The real benefits of e-invoicing become apparent only with a smart system that automates invoice processing. E-invoicing is just the first step to improving cash flow and spend visibility. Besides e-invoicing, companies should adopt a common approach to accounts payable and accounts receivable, as well as to archiving services – for e-invoicing won’t achieve effective cash flow management alone.
According to a Billentis report, 50% of back-office processes are expected to be handled by RPA (robotic process automation) solutions in the upcoming years. Jobs that will be automated include those of data inputters, new account clerks, procurement clerks, claim adjusters, bookkeepers, accountants, auditing clerks, checkers, billing and posting clerks, surveying and mapping technicians, bill and account collectors, and others.
Move it to the Cloud
Modern e-invoicing means not only a comprehensive approach but also scalable cloud solutions with access from any device. This approach helps customers increase operational efficiencies and improve IT and business agility by delivering services faster and optimizing operational expenses.
The most important benefits of comprehensive e-invoicing solutions—identified by companies that have already implemented such system—include lower costs, increased data accuracy and security, and instant, easy access to historical documents. For global companies in particular, compliance with varying regional regulations is extremely important. And the impact of e-invoicing on the environment cannot be ignored; 1 million e-Invoices = 133 trees saved.
Download this infographic to find more information about the business benefits and impact of e-invoicing.
If you are still not completely sure of your company’s position on e-invoicing, automation and digital transformation, take a minute to complete our “business spirit animal” quiz! You will learn about the strengths and weaknesses of your current strategy, which will enable you to make better decisions. Go to the quiz now.