How to prepare Accounts Payable to adapt to e-invoice mandates

Introduction

Businesses across Europe and many other jurisdictions are increasingly required to submit and handle electronic invoices. The initial reason for imposing e-invoice mandates was to make life easier for tax authorities, but they deliver many other efficiencies for business that adapt to them successfully. 

Adjusting your Accounts Payable (AP) processes to comply with e-invoice mandates might seem like a chore at first glance but actually presents an opportunity at scale once the right preparations, steps, and tools are in place.  

Based on our own experience, and backed by market research, we believe that organizations will increasingly prioritize compliance with government portals as more regulations are implemented, and finance leaders seek to drive automation and efficiency within their AP departments.

8 ways to transition e-invoice mandates

Effectively preparing your Accounts Payable (AP) function for e-invoice mandates requires a holistic approach encompassing strategic planning, process adjustments, and the adoption of technology. As the global adoption of e-invoicing mandates continues to grow, businesses must seamlessly transition their AP function to this digitalized approach. To ensure a successful implementation of e-invoicing, consider the following key tips: 

1. Understand e-invoice mandates today and tomorrow
   Staying on top of the regulatory landscape is key. By keeping yourself well-informed about local and international e-invoicing regulations and mandates you will be better positioned to adapt on time and plan your resources more effectively. As companies transition successfully, they secure their operations and relationships with vendors. It is also crucial to understand the specific requirements, formats, and compliance standards that pertain to your industry and locations. So, stay flexible and be prepared to adapt to changes in e-invoicing regulations. Timely assessments and optimization of your processes are paramount to take full advantage of new technologies, best practices, and of course, comply with regulations. 
2. Assess your current AP processes
   Carry out a comprehensive examination of your existing AP processes, encompassing the entire invoice processing cycle, from invoice reception and processing to approval and exporting. Identify potential areas for improvement or bottlenecks that could impede a smooth transition to e-invoicing. Evaluate your AP processes thoroughly, pinpointing opportunities for streamlining and automation to seamlessly integrate e-invoicing and benefit to the fullest from the new process. 
3. Choose the right AP software solution
   Carefully assess and choose an AP software solution that suits your unique business requirements and effortlessly integrates with your current ERP(s) or accounting systems. Consider various factors such as business objectives, compatibility with different invoice formats, reception channels for invoices (in addition to e-invoicing channels and formats), automation features, supplier assistance, and data analytics, among others. Opting for a smart AP software solution that aligns with your business needs and adheres to regulatory standards is crucial for the success of your AP operations and ensuring their future resilience.
4. Be aware of invoice formats
   E-invoicing regulations always include specifications that define the data that is expected to be present in the invoices and the format of this data. While adapting the internal processes to the new requirements, awareness about data formats is crucial to avoid unpleasant surprises when the endpoint (e.g. your ERP) is not receiving the expected data or the AP solution is not ready to process a specific format.
5. Establish communication channels with internal and external stakeholders Communicate all pertinent updates to stakeholders, including suppliers, and internal departments, to keep them informed of potential impacts on company AP operations. For instance, when introducing AP automation software, apprise your stakeholders of the changes and the advantages they stand to gain. Sharing information about your commitment to efficiency, punctual payments and enhanced transparency is likely to foster satisfaction among suppliers. Additionally, it is a good practice to do proactive management and communicate new e-invoicing mandates that will impact external partners and internal teams in advance.
6. Test, training, and change management as you transition
   Initiate pilot testing for your AP automation solution in the early stages. As e-invoices become exclusive in specific areas, additional testing during the transition phase ensures smooth operations. This proactive approach helps identify and resolve potential challenges before the full rollout.
   
   Simultaneously, implement a robust change management strategy that pays due attention to instruction. Offer comprehensive training sessions to the AP team and suppliers, equipping them with the necessary skills to navigate the new processes, transitions, and regulations. This proactive training approach facilitates a smooth transition and addresses resistance early in the adoption phase.
7. Automated exception handling and approval workflows
   Beyond enhancing invoice reception, automating data entry, and matching, and conducting compliance checks, AP automation software offers additional benefits for invoice processing. When assessing solutions for transitioning to e-invoicing, seize the opportunity to incorporate these essential features that significantly ease the work of AP team members, procurement, suppliers, approvers, and others. Such features could include: 
   
   Automated approval workflows to accelerate e-invoice processing, ensuring alignment with internal controls and regulatory standards. Streamline the invoice approval process through automation tools, minimizing manual tasks and enhancing overall efficiency. 
   
   Mechanisms for validation and exception handling, outlining clear workflows for addressing anomalies in the process. Promptly discuss and resolve discrepancies as they arise. This proactive approach contributes to a smoother and more effective invoice processing system.
8. Continuously monitor and optimize
   Consistently monitoring the performance of your invoice processes is instrumental in achieving heightened efficiency and facilitating data-driven decision-making. This principle extends to the realm of e-invoicing. Valuable data, sourced from your AP automation software, such as Cevinio’s Analytics Suite, combined with feedback from AP personnel and suppliers, serves as a crucial resource for optimizing processes and promptly addressing issues.

Can Cevinio Autonomous AP Invoice Processing help you adapt to e-invoicing mandates?  

Yes, Cevinio can help organizations adapt to e-invoicing mandates by automating the capture, processing, validation, and exporting of electronic invoices. But we can do the same with any type of invoice, PO and non-PO across multiple locations and entities.  

This helps organizations speed up processes, save manual effort, increase accuracy, and stay compliant among other benefits.

Here are some specific examples of how Cevinio can help organizations adapt to e-invoicing mandates: 

• Connectivity with government portals.  Cevinio is the solution provider that retrieves invoices directly from the government portals or helps with delivering invoices to the government portal. Not only is the distribution of invoices taken care of, but also the mapping of the relevant information and the necessary distribution of potential invoice statuses if required.

• E-invoice capture in different formats which are available as out-of-the-box interfaces. Many government requirements and portals use standard formats taken from popular e-invoicing networks, such as Peppol. Cevinio has experience connecting to many of these networks which simplifies and speeds up the integration. This not only supports organizations in communicating seamlessly and smoothly with their suppliers and public bodies, but it also helps them in the swift onboarding of invoice volume in digital formats.

• Automated compliance validations. For e-invoices, Cevinio validates invoices against a set of parameters and rules, such as quantity, price, invoice amount, local requirements, and supplier accreditation. This can help to identify and reject invalid invoices before they are paid.

• Automated enriching. Cevinio can not only automatically validate the invoice data and verify invoices against purchase orders, but also generate accounting proposals, matching invoices against accounting dimensions such as GL accounts, cost centers, profit centers and others. This is about the information that is required to autonomously process an invoice, but which is directly available on the invoice. 

In addition to these and other features, Cevinio also offers a variety of capabilities that can help organizations optimize their AP processes at scale. These include:

• Multiple language and currency support. Cevinio can process invoices in a variety of languages, which can be helpful for big organizations that have entities in multiple countries, working in different currencies. 
• Connectivity with multiple ERP systems simultaneously. Cevinio can export the invoices in the relevant ERP system and collect relevant acknowledgments (e.g. posting status or payment status). 

If you are looking to adapt to e-invoicing mandates and leverage the momentum to boost overall AP efficiency, let’s connect. Our team of experts will show you how by automating the invoice process, Cevinio can help your organization to reduce costs, simplify integration, improve accuracy, and meet compliance requirements.