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Electronic invoicing

January 01, 1970

Electronic invoicing (also called e-invoicing or einvoicing) is a form of electronic billing. E-invoicing includes a number of different technologies and entry options and is usually used as an umbrella term to describe any method by which a document is electronically presented from one party to another, either for payment[1] or to present and monitor transactional documents between trade partners to ensure the terms of their trading agreements are being met. These documents can include invoices, purchase orders, debit notes, credit notes, payment terms, payment instructions, and remittance slips.

Purpose edit

The accounts payable department has the purpose of ensuring all invoices from its suppliers are approved, processed, and paid. The main responsibility of the accounts receivable department is to ensure all invoices are created, delivered and subsequently paid by their vendors. Processing an invoice includes recording relevant data from the invoice and feeding it into the company's financial or bookkeeping systems. After the feed is accomplished, the invoices go through the company's business process to be paid.[2]

An e-invoice can be defined as structured invoice data issued in electronic data interchange (EDI) or XML formats, possibly using Internet-based web forms.[3] These documents can be exchanged in a number of ways, including as EDI, XML, or CSV files.[4] The company may use imaging software to capture data from PDF or paper invoices and input it into their invoicing system. Many companies hire a third-party company to implement and support e-invoicing processes and to archive the data on their own servers.[5]

The file extension .INV could be used. The .INV file can be in standards-compliant XML format.

History edit

Since the mid-1960s, companies have begun establishing data links with trading partners in order to transfer documents such as invoices and purchase orders. Inspired by paperless office, they developed the first EDI systems. At the time, there was no standard for electronic data interchange.

The Accredited Standards Committee X12, a standards institution under the umbrella of ANSI, moved to standardize EDI processes. The result is known today as the ANSI X12 EDI standard.[6] This remained the main way to exchange transactional data between trading partners until the 1990s, when companies began competing. New web-based applications allow for online submission of individual invoices as well as EDI file uploads, including in CSV, PDF, and XML formats. Suppliers could also see a history of all the invoices they submitted to their customers without having direct access to the customers' systems. This is because all the transactional information is stored in the data centers of the third-party company that provides the invoicing web app.[7]

According to a 2012 Global E-Invoicing Study, 73% of respondents used electronic invoicing to some degree in 2012, a 14% increase from 2011. Supplier resistance to e-invoicing has decreased from 46% in 2011 to 26% in 2012.[8] According to a report done by the GXS in 2013, Europe is adopting government legislation encouraging businesses to adopt electronic invoicing practices. The United States Treasury estimated that implementing e-invoicing across the entire federal government would reduce costs by 50% and save $450 million annually.[9]

Standards edit

Various standards exist. The EU's Directive 2014/55/EU on electronic invoicing in public procurement noted that "several global, national, regional and proprietary standards exist; ... none of them prevail and most of them are not interoperable with one another".[10]

  • EDIFACT
  • UBL (Universal Business Language)[11]
  • Finvoice (Finland)
  • EHF (Elektronisk Handelsformat) (Norway)
  • E-Invoice (Estonia)[12]
  • FacturaE (Spain)
  • Factur-X (France)
  • FatturaPA (Italy)
  • CFDI (Mexico)
  • ISDOC (Czechia)
  • E-faktura (Poland)
  • OIOUBL (Denmark)
  • PEPPOL BIS (various countries)
  • Svefaktura (Sweden)
  • UBL-OHNL (Netherlands)
  • ZUGFeRD, XRechnung (Germany)
  • Nota Fiscal Eletrônica (Brazil)
  • Facturación Electrônica (Ecuador)
  • DTE (Chile)

Under EU Directive 2014/55/EU on electronic invoicing in public procurement, the EU commissioned the development of a "European standard on electronic invoicing".[13]

Usage edit

To enable e-invoicing, there must be an existing method of viewing the transactions, typically an ERP (enterprise resource planning) or accounting system. Once routing is established in the system, validation rules can be set up to reduce the number of invoice exceptions. Once the e-invoicing specification testing is complete, the business's suppliers will be connected electronically.[14][15]

Government-mandated edit

Several governments and tax administrations imposed e-invoicing formats in their respective jurisdictions for business-to-business (B2B) transactions, and required that the emitted documents be stored in centralized repositories, often controlled by the tax administration. Mexico, for example, introduced the CFDI format in 2004 in Appendix 20 of its Tax Code, requiring that all invoices be stored with the Mexican Tax Administration.[16] Non-standard invoices have been banned by law since 2012. Chile implemented a similar system in 2003,[17] and Colombia in 2020.[18]

In the European Union, France introduced mandatory government-controlled B2B e-invoicing starting in July 2024.[19] This obligation has existed in Italy since 2019.[20]

The primary goal of government-controlled e-invoicing is to reduce corporate tax fraud. Per a research paper published by the Harvard Kennedy School of Government, Mexico's tax-to-GDP ratio rose from 12.6% to 16.2% between 2012 and 2017, driven largely by a 48% increase in revenue from tax on goods and services after e-invoicing was made mandatory.

The Malaysian Government declared in the 2023 Tax Budget that mandatory e-invoicing will be introduced for businesses with an annual turnover exceeding RM100 million starting in June 2024. By 2027, all businesses will be required to adopt this electronic invoicing method.[21]

See also edit

References edit

  1. ^ tieto. (2009). The future of E-invoicing, Pg. 5. Retrieved from digitdoc: (PDF). Archived from the original (PDF) on 2012-10-21. Retrieved 2013-06-17.{{cite web}}: CS1 maint: archived copy as title (link)
  2. ^ Accounting Tools. (2013). Accounts Payable Controls. Retrieved from accounting tools: http://www.accountingtools.com/accounts-payable-controls 2013-06-13 at the Wayback Machine
  3. ^ "e-VoicingBasics". 13 May 2011. Retrieved 13 April 2017.
  4. ^ GXS. (n.d.). Lost? Don't Know What to look for in an e-invoicing solution? Retrieved from GXS: http://www.gxs.co.uk/eBooks/eInvoicing/e-invoicing_ebook_uk.pdf 2013-10-29 at the Wayback Machine
  5. ^ US Bank, Scott Hesse. (2010, August 9). Electronic invoice Presentment and Payment (EIPP): Streamlining the Payment Process. Retrieved from nasact: http://www.nasact.org/conferences_training/nasact/conferences/AnnualConferences/2010AnnualConference/CS7_Hesse.pdf 2013-10-29 at the Wayback Machine
  6. ^ Hill, M. G. (n.d.). A brief history of Electronic Data Interchange, pg 6. Retrieved from BizTalk Server 2000: A beginner's Guide: http://books.mcgraw-hill.com/downloads/products/0072190116/0072190116_ch01.pdf 2014-03-09 at the Wayback Machine
  7. ^ GXS. (2013). A brief history retrieved from einvoicingbasics: http://www.einvoicingbasics.co.uk/what-is-e-invoicing/a-brief-history/
  8. ^ The Institute of Financial Operations. (2012). A shift toward e-invoicing ecosystems, pg. 6. Retrieved from baseware: http://www.basware.com/sites/default/files/restricted/2012-global-e-invoicing-study.pdf?rrt=21 2015-09-23 at the Wayback Machine
  9. ^ Bruno Koch, G. (2013, April). E-Invoicing/ E-Billing. Retrieved from GSX: http://www.gxs.co.uk/wp-content/uploads/billentis-2013-report.pdf 2013-11-02 at the Wayback Machine
  10. ^ European Union, Directive 2014/55/EU on Electronic Invoicing in Public Procurement, 16 April 2014, Preamble, section 1
  11. ^ Digital Business Council, eInvoicing Implementation Guide: Australian implementation of e-invoicing using UBL
  12. ^ Description of Estonian electronic invoice
  13. ^ European Union, Directive 2014/55/EU on Electronic Invoicing in Public Procurement, 16 April 2014, Article 3
  14. ^ E-Invoicing and Supplier Connectivity. (2015). Transcepta. Retrieved from transcepta: http://www.transcepta.com/wp-content/uploads/2015/05/Transcepta-Building-the-Business-Case-for-E-Invoicing-and-Supplier-Connectivity.pdf 2015-09-30 at the Wayback Machine
  15. ^ "Online invoicing software". Retrieved 14 May 2023.
  16. ^ "La historia de la facturación electrónica en México - Bind ERP" (in Spanish). Retrieved 2023-02-26.
  17. ^ Emprendedores, Hispanos (2020-10-12). "Cómo funciona la facturación electrónica en Chile". Hispanos Emprendedores (in Spanish). Retrieved 2023-02-26.
  18. ^ "Cómo es la factura electrónica en Colombia| EDICOM CO". edicom.co (in Spanish). Retrieved 2023-02-26.
  19. ^ "Obligation d'émettre des factures électroniques : un changement majeur dès juillet 2024". entreprendre.service-public.fr (in French). Retrieved 2023-02-26.
  20. ^ "1° gennaio 2019: la fattura diventa elettronica". MEF (in Italian). Retrieved 2023-02-26.
  21. ^ "E-Invoice (Electronic Tax Invoice)". 9 March 2023.

January 01, 1970
electronic, invoicing, this, article, tone, style, reflect, encyclopedic, tone, used, wikipedia, wikipedia, guide, writing, better, articles, suggestions, march, 2015, learn, when, remove, this, message, also, called, invoicing, einvoicing, form, electronic, b. This article s tone or style may not reflect the encyclopedic tone used on Wikipedia See Wikipedia s guide to writing better articles for suggestions March 2015 Learn how and when to remove this message Electronic invoicing also called e invoicing or einvoicing is a form of electronic billing E invoicing includes a number of different technologies and entry options and is usually used as an umbrella term to describe any method by which a document is electronically presented from one party to another either for payment 1 or to present and monitor transactional documents between trade partners to ensure the terms of their trading agreements are being met These documents can include invoices purchase orders debit notes credit notes payment terms payment instructions and remittance slips Contents 1 Purpose 2 History 3 Standards 4 Usage 5 Government mandated 6 See also 7 ReferencesPurpose editThe accounts payable department has the purpose of ensuring all invoices from its suppliers are approved processed and paid The main responsibility of the accounts receivable department is to ensure all invoices are created delivered and subsequently paid by their vendors Processing an invoice includes recording relevant data from the invoice and feeding it into the company s financial or bookkeeping systems After the feed is accomplished the invoices go through the company s business process to be paid 2 An e invoice can be defined as structured invoice data issued in electronic data interchange EDI or XML formats possibly using Internet based web forms 3 These documents can be exchanged in a number of ways including as EDI XML or CSV files 4 The company may use imaging software to capture data from PDF or paper invoices and input it into their invoicing system Many companies hire a third party company to implement and support e invoicing processes and to archive the data on their own servers 5 The file extension INV could be used The INV file can be in standards compliant XML format History editSince the mid 1960s companies have begun establishing data links with trading partners in order to transfer documents such as invoices and purchase orders Inspired by paperless office they developed the first EDI systems At the time there was no standard for electronic data interchange The Accredited Standards Committee X12 a standards institution under the umbrella of ANSI moved to standardize EDI processes The result is known today as the ANSI X12 EDI standard 6 This remained the main way to exchange transactional data between trading partners until the 1990s when companies began competing New web based applications allow for online submission of individual invoices as well as EDI file uploads including in CSV PDF and XML formats Suppliers could also see a history of all the invoices they submitted to their customers without having direct access to the customers systems This is because all the transactional information is stored in the data centers of the third party company that provides the invoicing web app 7 According to a 2012 Global E Invoicing Study 73 of respondents used electronic invoicing to some degree in 2012 a 14 increase from 2011 Supplier resistance to e invoicing has decreased from 46 in 2011 to 26 in 2012 8 According to a report done by the GXS in 2013 Europe is adopting government legislation encouraging businesses to adopt electronic invoicing practices The United States Treasury estimated that implementing e invoicing across the entire federal government would reduce costs by 50 and save 450 million annually 9 Standards editVarious standards exist The EU s Directive 2014 55 EU on electronic invoicing in public procurement noted that several global national regional and proprietary standards exist none of them prevail and most of them are not interoperable with one another 10 EDIFACT UBL Universal Business Language 11 Finvoice Finland EHF Elektronisk Handelsformat Norway E Invoice Estonia 12 FacturaE Spain Factur X France FatturaPA Italy CFDI Mexico ISDOC Czechia E faktura Poland OIOUBL Denmark PEPPOL BIS various countries Svefaktura Sweden UBL OHNL Netherlands ZUGFeRD XRechnung Germany Nota Fiscal Eletronica Brazil Facturacion Electronica Ecuador DTE Chile Under EU Directive 2014 55 EU on electronic invoicing in public procurement the EU commissioned the development of a European standard on electronic invoicing 13 Usage editTo enable e invoicing there must be an existing method of viewing the transactions typically an ERP enterprise resource planning or accounting system Once routing is established in the system validation rules can be set up to reduce the number of invoice exceptions Once the e invoicing specification testing is complete the business s suppliers will be connected electronically 14 15 Government mandated editSeveral governments and tax administrations imposed e invoicing formats in their respective jurisdictions for business to business B2B transactions and required that the emitted documents be stored in centralized repositories often controlled by the tax administration Mexico for example introduced the CFDI format in 2004 in Appendix 20 of its Tax Code requiring that all invoices be stored with the Mexican Tax Administration 16 Non standard invoices have been banned by law since 2012 Chile implemented a similar system in 2003 17 and Colombia in 2020 18 In the European Union France introduced mandatory government controlled B2B e invoicing starting in July 2024 19 This obligation has existed in Italy since 2019 20 The primary goal of government controlled e invoicing is to reduce corporate tax fraud Per a research paper published by the Harvard Kennedy School of Government Mexico s tax to GDP ratio rose from 12 6 to 16 2 between 2012 and 2017 driven largely by a 48 increase in revenue from tax on goods and services after e invoicing was made mandatory The Malaysian Government declared in the 2023 Tax Budget that mandatory e invoicing will be introduced for businesses with an annual turnover exceeding RM100 million starting in June 2024 By 2027 all businesses will be required to adopt this electronic invoicing method 21 See also editElectronic receiptReferences edit tieto 2009 The future of E invoicing Pg 5 Retrieved from digitdoc Archived copy PDF Archived from the original PDF on 2012 10 21 Retrieved 2013 06 17 a href Template Cite web html title Template Cite web cite web a CS1 maint archived copy as title link Accounting Tools 2013 Accounts Payable Controls Retrieved from accounting tools http www accountingtools com accounts payable controls Archived 2013 06 13 at the Wayback Machine e VoicingBasics 13 May 2011 Retrieved 13 April 2017 GXS n d Lost Don t Know What to look for in an e invoicing solution Retrieved from GXS http www gxs co uk eBooks eInvoicing e invoicing ebook uk pdf Archived 2013 10 29 at the Wayback Machine US Bank Scott Hesse 2010 August 9 Electronic invoice Presentment and Payment EIPP Streamlining the Payment Process Retrieved from nasact http www nasact org conferences training nasact conferences AnnualConferences 2010AnnualConference CS7 Hesse pdf Archived 2013 10 29 at the Wayback Machine Hill M G n d A brief history of Electronic Data Interchange pg 6 Retrieved from BizTalk Server 2000 A beginner s Guide http books mcgraw hill com downloads products 0072190116 0072190116 ch01 pdf Archived 2014 03 09 at the Wayback Machine GXS 2013 A brief history retrieved from einvoicingbasics http www einvoicingbasics co uk what is e invoicing a brief history The Institute of Financial Operations 2012 A shift toward e invoicing ecosystems pg 6 Retrieved from baseware http www basware com sites default files restricted 2012 global e invoicing study pdf rrt 21 Archived 2015 09 23 at the Wayback Machine Bruno Koch G 2013 April E Invoicing E Billing Retrieved from GSX http www gxs co uk wp content uploads billentis 2013 report pdf Archived 2013 11 02 at the Wayback Machine European Union Directive 2014 55 EU on Electronic Invoicing in Public Procurement 16 April 2014 Preamble section 1 Digital Business Council eInvoicing Implementation Guide Australian implementation of e invoicing using UBL Description of Estonian electronic invoice European Union Directive 2014 55 EU on Electronic Invoicing in Public Procurement 16 April 2014 Article 3 E Invoicing and Supplier Connectivity 2015 Transcepta Retrieved from transcepta http www transcepta com wp content uploads 2015 05 Transcepta Building the Business Case for E Invoicing and Supplier Connectivity pdf Archived 2015 09 30 at the Wayback Machine Online invoicing software Retrieved 14 May 2023 La historia de la facturacion electronica en Mexico Bind ERP in Spanish Retrieved 2023 02 26 Emprendedores Hispanos 2020 10 12 Como funciona la facturacion electronica en Chile Hispanos Emprendedores in Spanish Retrieved 2023 02 26 Como es la factura electronica en Colombia EDICOM CO edicom co in Spanish Retrieved 2023 02 26 Obligation d emettre des factures electroniques un changement majeur des juillet 2024 entreprendre service public fr in French Retrieved 2023 02 26 1 gennaio 2019 la fattura diventa elettronica MEF in Italian Retrieved 2023 02 26 E Invoice Electronic Tax Invoice 9 March 2023 Retrieved from https en wikipedia org w index php title Electronic invoicing amp oldid 1213765201, wikipedia, wiki, book, books, library,

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