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eInvoicing is Coming: Get Ready! Department of Education and Skills and eInvoicing Ireland Event
Declan McCormack, eInvoicing Programme Manager
Office of Government Procurement
11 June 2018
Agenda
• Introduction to eInvoicing – background and definitions
• European Directive on eInvoicing requirements
• PEPPOL and the Irish national eInvoicing model
• eInvoicing from a Users Perspective
• eInvoicing Ireland
2
“Member States shall ensure that contracting authorities and contracting entities receive and process electronic invoices which
comply with the European standard on electronic invoicing”
European Directive on eInvoicing in public procurement 2014/55/EU
eInvoicing - Countdown to Compliance
3
COMPLIANCE DEADLINE
18th APRIL 2019
In excess of 4 million
invoices are processed
by the Public
Sector each year.
Invoice processing: Public Sector Context
4
(Note: Data not available for all Public Sector Bodies)
It is estimated
that 90% of all
invoices are
delivered by
post and
received as
paper to the
Public Sector.
Volume of
invoices and
turnaround
payment
times place
high
administration
burden on
staff
Invoice volumes
per annum:
Health ~2m
Local Gov ~1.2m
Central Gov ~625k
D/Ed(ETBs) ~300k
Financial
Shared
Services
initiatives in
progress in
Health,
Education
and Central
Government.
4
Million90%
Health
Ed Build to Share
(Note: This is only a subset of invoice
volumes in the Education sector)
“Switching to e-procurement, and particularly to e-invoicing, can bring significant savings and make life easier both for the governments and for the thousands of
businesses active in the Internal Market.“
- Michel Barnier, European Commissioner for Internal Market and Services (Commission Press Release June 2013)
eInvoicing – The Benefits
5
Compliance
Reduced
administration
Business
intelligence
Better access for
SMEs
Process
efficiencies
Environment
Digital Agenda
eInvoicing – What is electronic invoicing?
6
National Legislation &
Standards
European Directive 2014/55/EU
• ALL Public Bodies
• NOT to contracts … declared to be secret/accompanied by special security measures
• Compliance by April 2019 (2020 for Local Government)
• No requirement for Suppliers to submit eInvoices at this time
• Member States are obliged to:
• “… receive and process electronic invoices which comply with the European standard”
eInvoicing - The Directive
7
Why?
Interoperability
Mass market driven solutions
How?
Member States/Standards expertise
Business processes based design
What?
Legal and commercial requirements
Commonly used elements
XML formats (x 2)
eInvoicing - The European Standard (EN-16931)
8
InvoiceCore
Elements
Invoice Note
Process Controls
Seller
Buyer
Document Totals
VAT Breakdown
Invoice Lines
PEPPOL – Pan-European Public Procurement Online
9
Origins - EU Large scale project
eDelivery Standards and Network
Enables eProcurement processes
OpenPEPPOL - Governance &
development
Network in 19 European countries,
plus Canada, USA and Singapore
PEPPOL – The eDelivery network for eProcurement
10
Connect Once – Connect to all
Access Point
Access Point
Access Point
Access Point
eDelivery Network
Service Providers
Shared Services
Contracting Authority
Supplier
Contracting Authority
eInvoicing - Sector/Shared Services-led Solutions
11
Suppliers
Education
LocalGovernment
Central
Government
Health
User’s Perspective: PEPPOL – The Four Corner Model
12
Contracting
Authority
Service Provider
Customer
Interface
PEPPOL
Access Point
Supplier
Service Provider
Customer
Interface
PEPPOL
Access Point
European eInvoice Standard
PEPPOL Network Standard
Common methods of generating eInvoices
• Directly from the ERP/Accounting system
- Internal format transformed into exchange format
• Through a web-portal
- Provided by the customer
- By supplier’s own choice
• Printer capture/Virtual printer
- Software installed as printer
- When printing, the data is rendered as an eInvoice
• Access to PEPPOL eDelivery network
- Common feature required for submission of European Standard compliant eInvoices
User’s Perspective: Suppliers - Generating an eInvoice
13
System/service of the customer
System/service of the supplierPreferred option may depend on
- Volume of invoices- Size of supplier- Requirement from customer
Key aspects of receiving eInvoices
• Service for receiving eInvoices
- The ”inbox”/ or technical entry point (PEPPOL Access Point)
- Support for several formats
- Important: Connectivity with other service providers, logging, validation and archiving
• Workflow for eInvoice/eProcurement solution
- For handling the eInvoices in an efficient manner
- Visualization, assessment/approval
- Sometimes ERP integrated but often a separate service
• ERP/Accounting solution
- For accounting and payment initiation
User’s Perspective: Buyers - Receiving an eInvoice
14
System/service of the supplier
System/service of the customer
1. The invoice is transmitted from the supplier
2. The invoice is received by the buyer
3. The invoice is routed automatically to the workflow
4. The supplier information is verified
5. The invoice has a reference to an order or a registered object (e.g subscription number, rent object id). Rules for approval is associated with the registered object
6. The invoice is automatically assessed and approved
7. Cost is booked into accounts and payment is initiated
Straight Through Processing – Reaping the Benefits
15
1.
Service provider
eInvoice workflow Accounting system
2.3. 4. 5. 7.
6.
Key Aspects
• Information in the invoice is used to automatically assess and
approve the invoice
• Only invoices deviating from what is expected are marked for manual assessment
• Use of Order reference
Refers to a purchase order previously issued by the seller
• Periodical invoices related to subscription, electricity, telecom or other invoice objects
Requires an invoice object registry with approved max/min, allowed variances
Can result in positive side effects – such as identification of unused phone subscriptions
Straight Through Processing – Buyer Reference is Key
16
End to End & Automatic
• Generation
• Transmission
• Reception
• Processing
Straight Through Processing – Process Flow
17
• Supplier & Buyer - Aligned capabilities• Agreed electronic format to use• How to find each other – party IDs?• Transmission• Security• Reliability
Issuer´s responsibility
Receiver´s responsibility
18
Considerations for a Roadmap for eInvoicing
For the supplier/issuer – Internal perspective• Suppliers have a diverse environment (such as different technical solutions,
processes, maturity level)
• Clear policy around standards helps
• Supporting tools can be provided – validation tools, presentation style sheets,
translations
• Aligned requirements on use of references and identifiers if possible
Interconnectivity – External perspective• Minimum requirement on technology for how to connect and for service providers
to collaborate
• Publicly available strategy on how to handle the European standard – both
domestically and cross border (CIUS)
• Transmission cross border (eDelivery)
For the public sector – Internal perspective• Up to each entity to tender for solutions or centrally provided?
• Maturity level of the public entities – are temporary solutions necessary?
• Mandate eInvoicing? Through law/contracts? Also below threshold?
• Centrally provided supporting tools, help desk, training and capacity building?
eInvoicing – The eInvoicing Programme
19
PROGRAMME ACTIVITIES
COMMUNICATIONS
Awareness
Understanding
Plan & Action
FRAMEWORK FOR PROCUREMENTAVAILABLE Q4-2018
eInvoicing Solutions/Services
Shared
Service
Centres
Sectoral/Local
PSB
Groups
Transitioning
PSBs
eInvoicing
implementation
eInvoicing
implementation
eInvoicing
implementation
COMPLIANCE DEADLINE 18th APRIL 2019
eInvoicing – Next Steps (Path to compliance)
20
Education
Awareness
Obligations TimelineNational/Sector
Approach
Suppliers &
eInvoicing Market
Understanding
Invoice
EnvironmentSystems
CapabilitiesBusiness
ProcessesOpportunities
Plan & Action
Sector
Solution
Systems
Interfaces
People &
ProcessesBeyond
Compliance
Compliance
eInvoicing – Watch this space - ogp.gov.ie/einvoicing/
21
• Contact Us – einvoicing@ogp.gov.ie
• EU Directive - http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32014L0055
• eInvoicing - https://ec.europa.eu/cefdigital/wiki/display/CEFDIGITAL/eInvoicing
• PEPPOL - https://peppol.eu/about-openpeppol/what-is-openpeppol/
eInvoicing – Contact & further reading
22
Thank You!
eInvoicing
23
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