RPA, AI, Blockchain, electronic invoice… the evolutions of Procure-to-Pay (P2P) are permanent. Being able to anticipate these changes and continually benefit from the latest innovations is essential to maximise the performance of your P2P process. We give you the keys to success here!
Anticipating regulatory and technological transformations
Whether it is increased regulations or adopting new technologies… finance department’s environment is regularly changing, and so any consideration around supplier invoice processing and the Procure-to-Pay-process must take this into account to be ready for the changes of today and tomorrow.
Electronic invoicing: from post-audit to clearance mode?
Many companies have seen the major benefits of electronic invoices (streamlining process, reducing payments times…), but the modes of transmission of e-invoicing in the UK is still loosely regulated, despite the fiscal administration’s aim to fight against VAT fraud.
However, there has been some first moves towards more digitalised processes at HMRC, such as Making Tax Digital for VAT, a new legislation applying to most businesses in the UK since April 2019. This has considered a first step by the UK government to close the VAT Gap (the difference between VAT paid and VAT to be owed).
Tax authorities around the world use two main models of trade control: clearance mode and post-audit mode. Let us explain more:
In the clearance mode, checks are done in real time. The electronic invoices issued by companies are sent to the concerned country’s tax administration, in an EDI format in most cases. Controls are applied before being sent to the customer. This has been implemented in countries like Italy, Russia, Brazil, Turkey and will be mandatory in France in 2023.
In the post-audit mode, on the contrary, checks are done once the invoice is issued and received. Invoices can be exchanged in different formats following the rules set by their country’s tax administration. Tax authorities have the right to carry out audits after the invoice has been issued, to verify they comply with these rules. This mode is being used in most European countries, and in the UK.
With more countries adopting the clearance mode, the question remains how long until similar changes are considered in the UK?
As many companies will be impacted, the first imperative remains to fully digitise their process, as it will be pointless to capture electronic invoice flows but remain with full manual downstream processing. If the UK is moving towards a Clearance model, with tentative steps like MTD for VAT, companies must audit and control their information flow and understand how their invoices are being captured.
It’s quickly becoming clear the need to prepare for these developments, with organisations having an interest in adopting solutions that allow them to capture all invoice streams, through all channels, in all formats. Hence, the importance of having an omnichannel solution for digitising the Procure-to-Pay process which already embeds connectors managing the new electronic invoice standards in pioneering countries in the field (Italy, Turkey, Spain…).
This is the whole meaning of the ‘Omnichannel Capture‘ technology offered by ITESOFT within the Streamline for Invoices solution.
Discover Streamline for Invoices
The most comprehensive Procure-to-Pay solution
‘Intelligent’ technologies to increase organisational performance
Technologies are constantly evolving. Whatever the new ones to come, having an end-to-end P2P digitalisation solution today is the best guarantee to take advantage of new technological opportunities tomorrow and to maintain the highest level of performance.
Taking advantage of the latest innovations to further increase efficiency is the challenge for finance departments. Disruptive technologies, like AI, make it possible to give even more performance to the digitalisation of Procure-to-Pay.
RPA (Robotic Process Automation) offers the possibility of automating 30 to 40% of manual tasks that are not yet automated: uploading invoices to a supplier portal, entering accounting data between Excel and ERP, verifying supplier data.
At ITESOFT we have been using AI for many years to intelligently process invoices, identify suppliers or orchestrate processes. More than 100 scientific publications have been produced on these subjects in collaboration with international research laboratories. AI also powers our specialised, out-of-the-box robots to automatically capture and process incoming documents and detect fraud and non-compliance.
56% of finance departments would like to carry out AI projects
Future of finance, study – ITESOFT (2020)
Disruptive technologies, with the acceleration of digital exchanges, are disrupting organisations with evolving and demanding regulations. Organisations must anticipate to stay ahead of the game. Seizing these opportunities is therefore vital to reinvent, gain in productivity, manage performance, and control risks… The best strategy for accommodating these competitive levers? It is to choose an “open” and “adaptable” Procure-to-Pay digitalisation solution. A solution with permanent innovation, to help organisations become faster, safer, and more efficient.