Organisations across all industries are feeling the impact of the current economic downturn and looking for ways to cut costs and increase efficiencies without disruption to their productivity. Ideal solutions should be implemented swiftly; leveraging earlier IT investments and not requiring large capital investments.

According to the European Commission, businesses across Europe can save up to 18 billion € by using an e-Invoicing solution. The Aberdeen report from May 2007 quotes a reduction of processing costs of 74 – 89%. Whether you are looking to cut costs quickly or sustain your business for future growth, OB10 will help you achieve your goals:

Reduction in costs – OB10 customers reduce by typically 60%
ROI in less than one year
Improve efficiency – removing manual tasks
Sustain your business growth

Focus within your organisation – improve efficiency and reduce costs
We all know that paper invoicing is inefficient, expensive and error prone. It uses expensive resources to manually input data and deal with supplier queries due to lost invoices, incorrect or missing information resulting in inefficiencies and inaccuracies which can affect cash flow management and effective forecasting.

Imagine if the manual invoice handling process could be removed. If data was received directly into your accounting system – containing all the information you require. As a business you would immediately increase efficiency, reduce processing time and costs and rely on invoice data for cash flow and forecast management.

Electronic invoicing from OB10 enables your suppliers to send data in their preferred format directly to your accounting system. We will work with you and your suppliers to ensure you receive reliable, tax compliant electronic invoice data. This not only enables you to remove manual input from the process and to focus staff on tasks that add value to your organisation, but also provides accurate real-time data to improve working capital and management reporting.

> Find out more on how e-Invoicing from OB10 works

Get the most from your suppliers
There has never been a more important time for buying organisations to support their supply chains. Suppliers are an integral, essential component of your business. Many suppliers are struggling due to the drop in business volumes, late payments and pressure being placed on them to squeeze profit-margins. It is important to you and the success of your business that your suppliers can continue to offer their services or products through the economic downturn – for your own benefit.

Reduce your costs and support suppliers with Supplier Payments
The Supplier Payments service is a powerful combination of e-Invoicing and innovative supply chain financing from Abbey UK Corporate Banking, bringing benefits to buying organisations and suppliers alike.

Developed with our partner Abbey UK Corporate Banking, this proven working capital solution reduces the cost of finance for the whole supply chain. In contrast to most other forms of supply chain financing, the payment is provided in the form of early cash to the supplier. Because payment is made early, your suppliers benefit from a reduced cost of finance and are able to provide services or products to their full potential. At the same time, you are able to support your suppliers during this difficult economic situation whilst maintaining your working capital position. Alternatively you may choose to negotiate a reduction in the cost of goods purchased.

www.ob10.com

Stefan Foryszewski is co-founder & senior vice president at OB10.

The banking industry is rarely out of the headlines at the moment.  Every aspect of how banks conduct their affairs is coming under scrutiny as a result of the credit crunch and the ensuing global recession.

Some of this activity is right and proper – and more attention of this kind in the past might have helped to alleviate some of the problems we now face.  Some of it will equally be unnecessary nit-picking – and once again, we must expect a certain element of over caution to follow the ‘NICE’ decade which we have all just lived through. 

As ever in business, the right approach will fall somewhere between these two extremes.  We can certainly expect increased risk management processes from the banks (and increased scrutiny of those processes by governments and regulators).  We should also prepare for a period of cost-cutting by all financial services providers (not least the banks), in order to support the process of realising efficiencies in order to restore margins and battered balance sheets to somewhere closer to their pre-crunch levels. When it comes to corporate banking, however, it might be argued that the most important challenge may be more difficult than risk management or cost-control – because it entails winning back the trust of disillusioned enterprise customers.

Banks are once again competing for corporate customers’ business and are looking for ways to add value to those customers.  Brand, trust and historical relationships will be important, as always – but those banks that can really differentiate their offering by showing a real focus on the core needs of the corporate customer will be a step ahead of the game.  As invoices are so closely linked to payment, a crucial element of the customer service proposition must be the ability to process invoices electronically.

e-Invoicing is not a new concept, Electronic Data Interchange (EDI) has been in use for decades. e-Invoicing networks however, are more advanced.  They enable suppliers to submit their invoices in any electronic format, making the submission process virtually painless. For example an e-Invoicing network can take electronic input from SAP systems of major corporations to simple QuickBooks-generated invoices from the smaller companies. An e-Invoicing network does all the data mapping from the supplier-submitted invoices and delivers the final invoice data into the customers accounting system, in their specified format.   e-Invoicing benefits both the sender and receiver of invoices, streamlining the whole process to offer guaranteed delivery and reduced processing times. On average, electronic invoice delivery cuts 14 days from processing times; reduced processing times means improved payment cycles.

The e-Invoicing movement has been gathering pace in recent months.  It may come as a surprise to some Banking Technology readers that the European Commission has turned its attention to the issue of processing invoices electronically, and has calculated that – were all business in the Eurozone to make the switch to e-Invoicing, up to €18bn could be saved.

There is always resistance when something new is suggested – like the total eradication of paper invoices. However, for those of us who’ve been working towards this goal for some years now, even the nominal backing of the EU suggests that a step-change is underway, and that the banks really can offer something that gives the corporate a much more efficient way of working (and chalks up some strong CSR credentials into the bargain).

Equally, it is not just the banking sector that is looking to reduce its costs.  Whether in recession or boom, corporate customers will always be attracted by solutions that help them to find new ways of retaining customers and reducing costs.  e-Invoicing is one such solution – and, even better – it rarely requires significant upfront cap-ex to implement. 

So, while e-Invoicing looks attractive to banking services providers, who view it as a channel through which to offer advanced business services, adding value to the customer proposition, it should also facilitate communication between corporates and their SME suppliers for instance, leading to direct bottom-line cost savings.

But the most important collaboration – at least for the banks – will be between bank and enterprise customer.  e-Invoicing in this sense gives the bank or financial services provider the opportunity to collaborate with its corporate customers, to forge links with existing services (online banking, payment services, and so on).  As such, it represents a potential win-win for corporate customers, giving them process improvements combined with risk and cost reduction and working capital benefits.

So, how can banks start to take advantage of the commercial benefits that e-Invoicing can offer them and their corporate customers?  Well, one example can be seen in Abbey UK Corporate Banking – part of the Santander Group, the largest financial institution in the Eurozone.  Abbey UK Corporate Banking has worked with us to deliver an innovative supply chain and working capital solution for its corporate customers.  The ‘Supplier Payments’ solution, enables corporate customers to pay their suppliers early, but retain funds to make payment within their standard payment terms. 

The basic proposition of Supplier Payments is very straightforward.  In a typical supply chain, the supplier pays to finance the period from the point at which goods are ordered until payment from the buyer is received. However, typically the supplier is the party in the supply chain for whom finance will cost the most.  As a result, the supplier inevitably factors this cost into the price of the goods or services purchased by the buyer. 

By contrast, Supplier Payments leverages the bank’s relationship with the buying organisation to reduce the cost of finance for the whole supply chain.  Supplier Payments allows suppliers to be paid early ahead of their normal trade terms at a lower cost of finance than traditional financing techniques, for example bank loans, overdrafts and factoring or invoice discounting.  e-Invoicing maximises the benefit available to the corporate and their suppliers as invoices can be received and processed more quickly. 

Here’s how it works. Corporates receive correct, tax compliant invoices from their suppliers  directly into their accounting system.  Once the invoices have been matched and approved for payment, the corporate sends details of the invoices to be paid to Abbey.  The bank then makes immediate cash payment to the supplier of 100% of the invoice value less a discount.  However with Supplier Payments, the discount amount is calculated using the corporates cost of finance, rather than the suppliers. The buyer then reimburses the bank with 100% of the invoice amount on the original invoice due date using its normal banking relationship.  By sending the invoice electronically, the supplier not only benefits from improved process efficiency, but a reduction in costs, associated reduction in credit insurance costs and risk.

This is just one small example of how banks can add value to their relationships with their corporate customers.  The scope of advantage which e-Invoicing can offer is vast – now it remains to be seen what is the catalyst that drives adoption across Europe and globally.

 www.ob10.com
Source: www.bankingtech.com

These include the European Commission Recommendation 1994/820/EC, the European Directive 1999/93/EC and the European Directive 2001/115/EC. These standards have served the dual purposes of facilitating VAT administration on the one hand and fostering e-commerce on the other.

What Is The Importance Of E-Invoicing VAT Transactions In E-Commerce?
The invoice of a commercial transaction is one of the most important documents in any business. The invoice must conform to accounting, tax, business and even linguistic rules. Guidelines governing indirect taxes such as VAT that are levied on the basis of a commercial transaction specifically provide rules for authenticity of origin of an invoice as well as the integrity of its content. The invoice is also necessary in order for the recipient to claim a VAT refund. With the transformation of conventional business into e-business, all member states have individually tried to regulate the complex legal issue of invoicing. These disparate efforts resulted in a disruption of the smooth functioning of the Internal Market.

The Commission launched a multi-annual project “Simpler Legislation for the Internal Market” (SLIM) in 1996 to streamline key Internal Market Legislation. The Commission’s report on the SLIM initiative was approved by the Internal Market Council on November 27, 1997. This report includes a commitment to study “the details considered necessary for drawing up an invoice for VAT purposes and the legal and technical requirements for electronic invoicing”.CEN, the European Committee for Standardization or Comité Européen de Normalisation, was founded in 1961 with twenty nine national members to develop voluntary European standards and to foster the European economy in global trading.

In 2003, at the request of the European Commission, CEN set up an open “E-Invoicing Focus Group” and issued a report analyzing the requirements on standardization issues relating to electronic invoicing resulting from the new VAT legal framework. The Council Directive 2001/1115/EC recognizes the legal validity of electronic invoices for VAT purposes and specifies the related, required, technical conditions.

What Is The European Commission Recommendation 1994/820/EC.?
The Commission Recommendation was developed at the request of the European Trade and Industry Electronic Data Interchange (EDI) user groups to provide the required legality, acceptability and security in the use of EDI in European member states. The Recommendation includes the Model European Interchange Agreement that was developed in line with the work carried out by the International Chamber of Commerce and several major industry sectors, including the automotive, electronics, retail and distribution sectors.

Trading partners were advised to agree and sign interchange agreements based on the European model prior to commencing the exchange of EDI messages. The Recommendation specifically deals with the definition of EDI, EDI messages, essential characteristics of EDI messages, security of EDI messages, admissibility of evidence regarding EDI messages, storage of EDI messages, EDI standards, applicable laws and security measures when using EDI.

Article 2 of the Commission Recommendation also provides for alternative provisions for accepting electronic invoices when they are sent by EDI, and the agreement then provides for the use of procedures guaranteeing authenticity of origin and integrity of contents. The Recommendation deals with the legal status of EDI by mandating that EDI is admissible in a member state to the extent permitted by national law.

How Did Directive 1999/93/EC Contribute To The Development Of E-Invoicing?
The European Parliament and Council issued Directive 1999/93/EC on Community Framework for Electronic Signatures. The Directive introduced a legal framework to guarantee EU-wide recognition of electronic signatures. This Directive recognizes the importance of the electronic signature as a prerequisite for e-invoicing and security of data transmitted electronically.

The purpose of the Electronic Signature Directive is to facilitate the use of electronic signatures in e-invoicing and to contribute to their legal recognition. It establishes a general framework for electronic signatures and certain certification services to ensure the proper functioning of the internal market. Electronic signatures are also considered important as they facilitate the wide use of e-invoicing. Apart from its commercial value, the invoice is an accounting document, it has legal implications to both transacting parties and it is the basis for VAT declaration and reclamation, statistics declaration for intra-community trade and export and import declaration for extra-community trade.

How Has Directive 2001/115/EC Enabled E-Invoicing For VAT?
European Directive 2001/115/EC specifically deals with e-invoicing. It clarifies the implementation of e-invoicing and aims to introduce harmonized procedures for paper as well as e-invoicing across all member states. The Directive outlines the liability of taxable persons and their service providers for the integrity of content and authenticity of origin of electronic invoices for VAT purposes. This relates mainly to the invoices exchanged electronically and to the storage of invoices.

Under the Directive, no member state can refuse the invoice of goods or services sent by electronic means provided that the authenticity of the origin and integrity of the contents are guaranteed by means of an advanced electronic signature (AES), or by means of EDI as defined in Commission recommendations. Member states may, however, require the advanced electronic signature to be based on a qualified certificate. Invoices may also be sent by other electronic means subject to acceptance by the member state(s) concerned.

Although the EDI invoice message has been adopted by several industry and trade sectors in Europe, it has not been implemented to its full potential. Paper invoices have been maintained to overcome difficulties surrounding VAT regulation. Several member states introduced special procedures to allow EDI paperless invoicing but still require companies to apply for permission from the tax administration and in some cases to exchange summary VAT control messages, electronically or on paper. For cross-border electronic invoicing, companies are exchanging electronic invoices for company administration application, but are forced to parallel the exchanges with paper invoices to meet member state VAT requirements.

Source: ibls.com

Main view: to reduce burdens on business and to help Member States tackle fraud.

The European Commission today adopted a proposal to change the VAT Directive 2006/112/EC in respect to the invoicing rules, based on a Communication on the technological developments in the field of electronic invoicing. The aim of the proposal is to increase the use of electronic invoicing, reduce burdens on business, support small and medium sized enterprises (SMEs) and help Member States to tackle fraud. The proposal simplifies, modernises and harmonises the VAT invoicing rules. In particular, it eliminates the current barriers to e-invoicing in the VAT Directive by treating paper and electronic invoices equally. The proposal is a key element of the Commission’s Action Programme to reduce burdens on business by 25% by 2012, and is part of the Commission’s strategy to combat VAT fraud more efficiently.

László Kovács, Commissioner for Taxation and Customs, said: “Current national VAT invoicing rules are excessively complicated and disparate. This has led to unnecessary administrative burdens on businesses operating cross-border and has also facilitated VAT carousel fraud. Today’s important initiative will put forward much simpler, more modern and comprehensive rules for invoicing, whilst allowing tax administrations effective means of control. Paper and electronic invoices will be treated equally which will allow businesses to move to a 100% e-invoicing system and to save up to 18 billion euros across the EU”.

The Communication and the proposal reflect the real concerns of the business community and tax administrations, as indicated in their replies to the public consultation. A recent opinion of the High Level Group of Independent Stakeholders (HLG) also showed a demand for all the VAT aspects of invoicing to be looked at more widely. The proposal adopted today, therefore, not only addresses the VAT obstacles which hamper the up-take of electronic invoicing, but it also addresses difficulties that businesses face in respect to issuing and storing (especially electronically storing) of invoices, as well as discrepancies of the content of invoices.

The Commission believes that it is necessary to increase the up-take of electronic invoicing, by removing the pre-conditions of advanced electronic signatures or electric data interchange (EDI) for sending invoices electronically. Moreover, the electronic storage of invoices will be allowed, even if the original invoice is in paper format, and common storage periods are set.

Other measures to help reduce burdens on business include the removal of the many options available to Member States, thereby creating a harmonised set of invoicing rules. This will help those businesses that want to implement practices such as self-billing or summary invoices and will allow the larger businesses to centralise their invoicing.

To help SMEs, the proposal widens the use of simplified invoicing, notably for small value invoices (up to 200 euros) which will be of particular benefit for smaller businesses. It also allows simplified invoicing for business to consumer (B2C) supplies and certain VAT exempt supplies where the risk of fraud islimited. In addition, and of direct benefit to SMEs, is the option for Member States to introduce a cash accounting scheme under which the tax becomes due only when the invoice is paid.

Notwithstanding the measures to help reduce burdens on business and promote SMEs, safeguards are maintained or enhanced to help the authorities to tackle VAT fraud. As businesses operating cross-border will have to report their transactions in the month of the supply, fraudsters will not be able to abuse the possibility of including an invoice in a later reporting period. Moreover, the rules on the right to VAT deductions are strengthened in respect to the requirement to hold a valid invoice and as regards the contents of invoices.

Background

The VAT Directive requires that the Commission present a report and, if appropriate, a proposal amending the conditions for electronic invoicing. With the need also to address shortcomings with regard to other VAT rules on invoicing, the scope of the report and the accompanying proposal have been widened to include all aspects of the invoicing rules.

Questions and answers on technical issues of the proposal are available at this web page:

http://ec.europa.eu/taxation_customs/taxation/vat/traders/invoicing_rules/index_en.htm

Further information on the Communication and the proposal can be found at:

Communication:

http://ec.europa.eu/taxation_customs/taxation/vat/key_documents/communications/index_en.htm

Proposal for a Directive:

http://ec.europa.eu/taxation_customs/taxation/vat/key_documents/legislation_proposed/index_en.htm

The Commission sought the views of the public and commissioned a study on invoicing in order to be better informed as to the problems faced by business in respect to invoicing.

Further information on the public consultation and invoicing study can be found at:

http://ec.europa.eu/taxation_customs/common/consultations/tax/index_en.htm

Invoicing study:

http://ec.europa.eu/taxation_customs/common/publications/studies/index_en.htm

OB10 and Basware are helping save business customers vast amounts of paper by completely eliminating the need for printed invoices

Basware, the leading provider of purchase to pay solutions, today announced a global partnership with OB10, the leading global B2B e-Invoicing network. The partnership enables Basware’s customers to benefit from OB10’s best practice supplier enrolment. With the partnership, Basware’s customers will be able to receive electronic invoices from their suppliers via OB10, further extending the global reach of the Basware supplier network. The OB10 cooperation will help Basware customers streamline their invoicing and payment process, allowing customers to benefit from improved efficiency and transparency within the financial supply chain. Through e-Invoicing, organisations can optimise their invoice processes and further eliminate the need for paper invoices while reducing cycle times and improving cash flow forecasting.

The partnership also enables delivery of invoice data from the suppliers accounting system, via the OB10 network into the Basware Business Transactions e-Invoicing service and further to Basware Enterprise Purchase to Pay solutions, allowing users to receive accurate, real-time invoice data. This is achieved through OB10’s best practice supplier enrolment, data integration and mapping, enabling invoice data to be extracted from a supplier’s billing system, using their existing data format, and sending it to Basware’s e-Invoicing service – eliminating the need for customers to process, manually key-in, or store paper invoices.

“Basware is delighted to announce the partnership with OB10. To serve our customers in the best possible way, we have made a conscious decision to establish an open supplier network which makes us unique in the e-Invoicing operator space,” says Ilkka Sihvo, CEO, Basware. “Thanks to this new partnership, our customers can further extend their e-Invoicing reach through OB10’s global network. We believe that electronic invoicing helps our customers improve the invoice processing itself, but also helps them make a contribution in an effort to help the environment.”

Jamie Gunn, CEO, OB10 says: “Basware is a forward thinking international company, known for its vision and the quality of its products. We are pleased to bring OB10’s e-Invoicing services to Basware’s customers worldwide and believe the industry, analyst community, customers and prospects will recognise this as a significant combination in the marketplace. We have a history of successful joint implementations and look forward to replicating those successes rapidly and over a wider geographic footprint.”

Source: www.basware.com

Last week, Adobe presented its intelligent PDF eInvoicing solution in a white paper. Adobe proposes an end-to-end approach in which the e-invoice is interpretable by both humans and computer systems. The Adobe approach is based on the eInvoicing processes as described by the CEN/ISSS Workshop on Compliance of e-Invoices and is expected to be compliant with EU and respective national VAT regulations.  
 
The importance of the CEN/ISSS Workshop deliverables
The Adobe whitepaper shows once again the importance of the deliverables of the CEN/ISSS Workshop deliverables. At this point the Workshop is in its second phase, having delivered at least one groundbreaking deliverable: the Draft Good Practice Guidelines. These guidelines are available here, here and soon on www.cenfiscalesguidelines.com Some groups with other interests on e-invoicing do not quite agree with these Guidelines. But we arguably can not ignore the fact that this is a serious attempt to remove one of the major barriers on e-invoicing: uncertainty on e-invoicing.
 
Intelligent PDF: removing barriers? 
The intelligent PDF approach presented by Adobe could also serve as a mean to remove a barrier to e-invoicing: adoption in a B2B environment.

E-invoicing is acknowledged to be an unstoppable innovation across and outside Europe. Taking a leap in the future, full scale e-invoicing would mean that the vast majority of organisation is not only sending e-invoices, but also –and this very important– receiving e-invoicing.

One of the results from a major survey conducted by e-business watch showed that most of the companies prefer to receive e-invoices per e-mail in PDF. This is not the answer that some of the BSP would like to hear. But it clearly shows that receivers are in need of control over the inbound e-invoice.

The intelligent PDF approach of Adobe does just that. It combines the humanly interpretable PDF with a for computer systems readable XML format. So now we can receive and read the PDF invoice and having established the perception of control over the e-invoice, we can now extract and import the XML data into our financial software. 
 
This enables e-invoicing between business partners regardless of size, sector, business processes and accounting software. If in fact the intelligent PDF approach guarantees compliance with the respective national VAT legislation, it would also be usable in cross border e-invoicing.
 
Intelligence in authenticity and integrity?
Interestingly enough, the Adobe intelligent PDF whitepaper mentions the possibility to sign the PDF document. So the PDF document is the format that is being used for formal validation. The invoice’s XML data can be submitted for material validation against external documentation such as supplier contracts. E-invoices archived in PDF/A guarantee the fidelity of the invoice, while the use of XML ensures that invoice data can be transformed to any format required by auditing software.
 
Maybe it is also interesting to use the XML data for formal validation. This would implicate that not only the PDF document is signed, but also the XML file, for instance with XADES or XMLDSIG. Then, the XML feed can also be used for formal validation even when archived. Additionally it would be very interesting for SME’s to use the PDF document for material validation.
 
So, the Adobe intelligent PDF is more intelligent compared to the plain old PDF docyument. We can expect it to have an impact on removing the barrier of awareness, including the aspect of adoption by have the perception of being in control. And maybe the approach can be made even more intelligent by incorporating XML signing. This would be very interesting because then it would not matter which document is being used for formal validation: PDF or XML, or both. Creating ease of use (which will be explained in the next Featured Article).

Read the Adobe white paper here:

OB10, the global e-Invoicing network, has been awarded an internationally recognised Green Apple Award for its environmental best practice for the second year running. OB10’s global e-Invoicing solution helps companies of all sizes to eradicate vast amounts of paper each year by eliminating the need for paper invoices. The OB10 e-Invoicing network helps to simplify and streamline the invoice-to-pay process by extracting invoice data from a supplier’s billing system and sending it to their customer’s accounting system – eliminating the need to print, mail, process, manually key-in, store and then finally dispose of paper invoices.

To make the whole invoice process completely paperless, OB10 also archives invoices electronically, providing access for both suppliers and buyers via the OB10 Portal. Conducting the invoicing process in this way saves vast amounts of paper (as well as postage, logistics, transportation, etc. for delivering invoices) and helps the finance function to become more environmentally compliant.

The award is run by the Green Organisation, an independent non-profit, non-political group supported by the Environment Agency and the Chartered Institute of Environmental Health. Green Apple Awards are presented to Companies that have recognised the benefits that can be gained from environmental best practice, and also realise the business benefits of being green. Jamie Gunn, CEO, OB10, commented, “We are delighted to receive this Green Apple award for the second year running from the Green Organisation. It’s great news that the environmental benefits of e-Invoicing are being recognised. Businesses need to be fully aware of the damaging consequences of paper invoices. It is not only the cost and efficiency savings that can be made, but with the amount of paper invoices in circulation, in Europe alone – that equates to 763 housand tons of paper or almost 13 million trees, not including the fuel and landfill space that is also saved.”

In the past year alone, OB10 has electronically processed more than four million transactions on behalf of its global customer base, the equivalent of 85 tons. Using standard industry calculations1, that saving represents 1,443 trees which have been spared, as well as enough fuel to run 100 cars for over 1,000 miles, fuel a home for 42 years and 208 cubic metres of landfill space. With OB10’s year-on-year global growth, and the increasing acceptance of electronic invoicing, the environmental savings are set to increase even further. To put it into context, the 1,443 trees that OB10 saved last year could have absorbed up to 231,485 kilograms of Co2 in just one year, and released enough oxygen back into the atmosphere to support a staggering 2,886 human beings.

About OB10
OB10  is the leading global B2B e-Invoicing network. OB10 simplifies and streamlines the complex invoice-to-pay processes. Neither client organisations nor their suppliers are required to implement any hardware or software, and OB10 is independent of data file formats. OB10 can reduce the cost of paper invoice processing by typically 60 percent and can deliver an ROI in less thana year if the programme follows OB10’s best practice guidelines. Operational across Europe, North America and Asia, OB10 is compliant with the requirements of VAT, tax and e-Invoicing legislation and receives invoices from suppliers in over 100 countries. To ensure unrivalled and rapid supplier enrolment, each new customer’s suppliers are supported by an implementation services team responsible for getting them up and running on the OB10 network. Customers include: Agilent Technologies, Barclays, BP, Cargill, DHL, DSG International, Eli Lilly & Company, Fisher Scientific, General Motors, GlaxoSmithKline, Hewlett Packard, IBM, Kellogg’s, Logica, Lufthansa, Mohawk Industries, Norwich Union, SaraLee, Shaw Industries and Steria.

Source: www.OB10.com

Corporate finance executives have been asking where’s the benefit of the single European payment area, SEPA? Moti Porath of Fundtech argues that now is the time for those directors to reinvent their financial supply chain. Building on the electronic payment and invoicing services around SEPA standards will capitalise on existing investments and attract new business.

Single Euro Payments Area (SEPA) adoption promised to deliver on the grand visions of European harmonisation and a cashless society. But in reality it has been regulatory compliance that has driven adoption for most banks. Company directors and corporate finance departments have asked ‘what’s in it for us?’ and been met with a wall of silence. It is no surprise that financial institutions have been reluctant to engage with the directive. But the vision of eSEPA, an electronic approach to SEPA, is beginning to attract interest.

Using SEPA rules as a driver, banks can create an electronic financial supply chain that is faster and more cost effective for customers, primarily those within corporate finance. Beyond compliance this is an opportunity to revolutionise the financial supply chain and create a ‘win win’.

This progression is long overdue. In a recent report ‘Is European Regulation the Stepmother of Invention?’ TowerGroup research director Gareth Lodge notes that innovation in payments has been lethargic at best. “Many of the processes today are largely based on what was done yesterday – or rather yesteryear. SEPA gives the opportunity to change not just legacy solutions but legacy thinking. The regulation offers an opportunity for banks to reinvent their operations with an eye toward the future, not the past.” The key element for corporates is the chance to reinvent the financial supply chain. Building services around SEPA standards will capitalise on existing investments and attract new business.

Source: Accountingweb

Source: Bo Harald

Tax authorities took a cautious view towards e-invoicing in the first round. In some countries even cumbersome extra demands were put on this new practise and crossborder invoicing was made difficult and costly as regulation started to increasingly differ.

Then there was a question. Why should not sending and receiving paper and e-invoicing be treated in the same way from the VAT angle? All invoices are after all produced in the same auditable process and should be stored in the same retrievable way. Are not e-invoices in fact more secure already because of the e-transport and tracability? Why should this practise have additional VAT-angle demands?

Nobody could find any good reasons for causing especially SMEs additional costs and pain by imposing more demands on sending invoices in structured e-form and mostly in managed networks as opposed to paper mail or unstructured e-mail messages. In fact it should be the other way around……………….

Then there was light.  Most countries in EU now seem to be ready for ET of e- and paper. This is the biggest favour that can be done to the SME-sector – increasingly being forced into e-invoicing by larger trading partners. It will make them much more competitive, cost-efficient and integrated parts of trading networks and provide learning by doing for the next digital document layers. Structured documents can also clearly cut their accounting cost.

E-invoicing could help businesses cut costs as they brace themselves for recession.

The technology is moving to the mainstream as the European Commission pushes it as part of its drive to cut costs in supply chains.

The Corporate Action on Standards project, set up by the European Payments Council, said that e-invoicing allows companies to cut the average EUR30 cost of processing a paper invoice by 80%.

Businesses that want to take advantage of e-invoicing can do it themselves, use an e-invoicing service provider or work with their banks.

Stefan Foryszewski, senior vice-president at e-invoicing service provider OB10, says businesses are looking at e-invoicing but only “the more enlightened ones.”

“The market is still fairly immature but awareness is beginning to grow,” he says.

Forysewski advises businesses moving to e-invoicing to ensure that their enterprise resource planning (ERP) systems are compatible with the system they chose. They must ensure the system they chose can be easily integrated with all suppliers. And they must ensure they comply with the taxation laws in the different regions they receive invoices from.

Building an e-invoicing system is challenging for companies to do on their own and the capital investment required may be hard to justify as the economy slows.

DHL began rolling out an electronic invoicing and payment system from Accountis in July last year. The project aims to save millions of pounds across Europe by reducing billing costs by 15%.

Brian Thumwood, e-billing programme manager at DHL, says the company chose a third-party supplier to avoid the risks of building its own system. “We looked at doing it ourselves but the complexities associated with the legal structure in different countries and the technology made us work with a supplier.”

Businesses only need minimal technology in place to use a third-party service, such as dedicated servers, a connection to the e-invoicing service, and the use of workflow systems.

Peter Ratcliffe chairman of Accountis points out that many e-invoicing suppliers have been bought up by larger businesses which means their software is no longer commercially available. For example, E-invoicing software providers Harbor Payments and Xign were acquired by American Express and JP Morgan respectively in 2007. As a result, companies that set up their own e-invoicing services would have to write their own software, he says.

Banks are using e-invoicing service providers to create their own services. Abbey launched a corporate e-invoicing service in July last year in partnership with e-invoicing network provider OB10, as part of a service to offer finance to supply chains.

Tom Crowe, director of sales and delivery financial supply chain solutions at Abbey Corporate Banking, says take up of e-invoicing is slow because it is a new concept in the UK.

But he said that businesses will take it up because of the savings that can be made. “Anything they can do to make businesses more efficient they are keen to look at particularly in a period of economic uncertainty,” he says.

The Royal Bank of Scotland (RBS) has announced that the first customers of its e-invoicing system, provided by Accountis are going live this month.

In the current economic climate an 80% reduction in the cost of a paper invoice will be attractive to business managers attempting to cut unnecessary costs. IT departments must, however, decide how they are going to implement e-invoicing to maximise the return on investment.

What is E-invoicing?

E-invoicing is an alternative to Electronic Data Interchange (EDI) as a method of dealing with supply payments electronically. It also helps get the best out of ERP systems by automatically putting more accurate information into the systems.

E-invoicing uses the internet to connect businesses with their suppliers and automates the processing of invoices in accounting systems. It speeds up payment times, improves the information in ERP systems, reduces the human resources required and eradicates inputting errors. It also cuts postage costs and reduces waste paper.

EDI is a point-to-point computer connection between a business and a supplier which uses a network provider to process transactions. Large businesses use this method to connect with their major suppliers.

Source: Computerweekly