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e-Invoices ASEE Content Services

e-Invoice in EU

Regardless of the size of your enterprise, the question isn’t whether you should include electronic invoicing (e-Invoice) in your business operations, but rather why haven’t you already. In certain countries, electronic invoicing is not only encouraged but mandated by law for Business-to-Business (B2B) and Business-to-Government (B2G) transactions.

Short history of e invoice

In the decades following the 1960s, electronic data interchange (EDI) emerged on the stage. This was done quietly, but it set the stage for what was to come. In the late 1990s, as the internet gained momentum, electronic invoicing (e-invoice) found its footing in the business world. With standardized formats, it quickly became the new norm, simplifying business everywhere. Today, it’s the backbone of digital evolution, making business smoother, faster, and greener.

Why eInvoice

Why not? Today, businesses still use a lot of paper invoices. This can be drastically reduced by using e-invoices, as they offer numerous advantages for businesses operating in the EU. Companies can significantly reduce their environmental footprint by transitioning from traditional paper invoices to digital formats. This shift eliminates the need for paper usage, reduces printing costs, and minimizes reliance on scanners for document processing.

E-invoices enable safer storage and easier retrieval of documents. By utilizing document management systems, e-invoices are securely stored and readily accessible when needed. This streamlined approach enhances organizational efficiency and conserves energy and resources previously expended in the paper-based invoicing process. Another notable benefit is the expedited payment cycle facilitated by e-invoices, resulting in better cash flow.

Optimizing Invoice Management

Businesses can implement semi-automated and fully automated processes for invoice receipt, processing, and submission to the document management system.

Semi-automated processes can benefit from adding user tasks. These can be used when additional information is needed for the invoice, complexity of further processes is dependent on user input, etc.  Fully automated processes can be used to create a straight through process, meaning no user intervention is needed.

e-Invoice integration challenges

As with any software, this one is not without its issues. The problem does not lie with the UBL, CII, or EDI standards or with PEPPOL. The main issue arises from the way each country handles its e-invoices, and because of this, e-invoice providers have varying approaches to managing the e-invoice lifecycle.

Some e-invoice providers offer features such as changing invoice statuses, maintaining invoice history, and options to accept, reject, cancel, or revoke invoices. Others, however, do not offer these functionalities, and this poses significant challenges for companies that are integrating e-invoices into their systems.

electronic invoice ASEE Content Services

e-Invoicing in practice

For example, as of the time of writing, Romania’s eFactura does not support invoice status changes. This limitation can create issues when importing e-invoices into a custom business process, DMS, or ERP system, as it then becomes the system’s responsibility to track the imported invoices. Additionally, the lack of statuses like „accept“, „cancel“ or „revoke“ means that both parties in the transaction are in the dark regarding the current status of the invoice. This is undermining the goal of a fully automated system.

Here lies the strength of a truly robust and flexible system that can accommodate various challenges seamlessly. By choosing the right partner to incorporate e-invoices or another business process, you can focus more on maximizing efficiency and growth than on implementation and its inner workings.

Key benefits of e-invoices

▶️ Data accuracy — e-invoices are less prone to errors because they remove classification, optical character recognition (OCR), and user validation from the equation. The invoice issuer is solely responsible for the accuracy of the data, and if, for some reason, the data is incorrect, it can be easily revoked.

▶️ Cost-effective — e-invoices will always take less time to process than traditional paper invoices. Because of this, companies will have significant time and cost savings.

▶️ Traceable — troubleshooting and payment tracking are quite easier and quicker with e-invoices.

▶️ Cash flow — removing paper and manual tasks from the equation consequently removes the biggest bottleneck in invoice processing, resulting in faster payment.

Tips and Best Practices:

If you are embarking on the journey of implementing electronic invoicing, it’s essential to approach the process strategically. Implementing electronic invoicing requires time and resources, and the process may vary significantly across EU member states due to differing regulations and service providers.

Consider the following tips and best practices:

▶️ Research and understand the regulatory landscape in your target markets to ensure compliance with local requirements.

▶️ Evaluate different electronic invoicing standards and solutions to identify the most suitable option for your business needs.

▶️ Find an experienced partner that will help integrate e-invoice into your business processes, and not only that but also find other ways to bring your business to be fully digital.

▶️ Invest in employee training and change management initiatives to facilitate smooth transition and adoption of electronic invoicing practices.

By following these tips and best practices, businesses can navigate the complexities of electronic invoicing implementation effectively and unlock the full potential of digital transformation in financial operations.

Conclusion

e-Invoicing is here, it has been and will stay, as it brings significant advancements in cost savings, financial operations, and process streamlining. You are probably asking the question, “Why should I migrate from my current paper invoice digitalization?” You shouldn’t if it is not mandated, but why not?

Removing user tasks further reduces possible errors, speeds up the whole process, and prepares you for when it becomes legally mandated.
As a seasoned player in this industry, we are here to help you facilitate your transition to a fully digital system. Trust us when we say that after it’s all finished, you’ll wonder why you didn’t make this change sooner.

Interested? Let’s chat.

Additional reading material:

eInvoicing Country Factsheets for each Member State & other countries

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