eInvoicing: Helping credit professionals with fast, efficient and secured payments

By Mark Stockwell

eInvoicing is different from the traditional methods such as paper, PDF and email and therein lies its power. eInvoicing is the exchange of standardised and structured invoice data between buyers’ and suppliers’ software via a secure network. It doesn’t matter what eInvoicing software you are using, any business set up to send or receive eInvoices can exchange eInvoices with any other eInvoicing enabled business. The Australian Government has been working to promote eInvoicing as a more efficient and secure way for SMEs to manage their invoices.

One of the key benefits of eInvoicing comes through increased productivity and reduced admin costs. With eInvoicing, businesses sending eInvoices will benefit from timely and accurate delivery of their invoices, save time spent on chasing late invoices, can enjoy faster payments and better management of receivables. Businesses receiving invoices will save time and money currently spent on scanning, data entry, following up missing information and fixing errors when processing invoices. Better quality data will help businesses to further streamline their accounts payable processes, improve accuracy and reduce errors. It can also deliver other potential benefits, including better supplier relationships and decision making supported through data analytics, and help reporting obligations, such as Payment Times Reporting.

In addition to the productivity benefits, eInvoicing can also help to improve the security of business transactions. As cyber threats continue to increase against businesses it is more important than ever to make sure your business is as safe and secure as possible. eInvoicing can help keep do just this. eInvoicing provides increased security for businesses since invoices are sent and received via a secure network of accredited service providers, bypassing the need to use email, helping to eliminate emails and PDFs as possible attack vectors. This can help mitigate the risk of your businesses becoming the victim of a false billing or payment redirection scam and reduces the number of opportunities for attackers to send viruses disguised as PDF invoices. All of this can help reduce the risk of theft and loss of money, data, or sensitive information, keeping you, your trading partners, and the community safe. eInvoicing can also help businesses meet their ESG targets by reducing the environmental impact of their invoicing processes through reduced paper usage, minimized energy consumption for mailing and processing invoices, and decreased greenhouse gas emissions, and demonstrating good governance through the enhanced accuracy and security eInvoicing provides.

The Australian Government has adopted the Peppol framework as the standard for eInvoicing. Peppol is a set of procurement standards, legal agreements and an eInvoicing delivery network that is used by more than 40 nations worldwide, including New Zealand, Singapore, and Japan in our region, to facilitate the exchange of eInvoices and other procurement documents.

In Australia, eInvoicing is not used for tax compliance. While the ATO is appointed as the Australian Peppol Authority, its role is to govern the framework. The ATO manages the changes to specifications, accredits service providers and works with many stakeholders across the economy to drive adoption. The ATO can’t see eInvoices transmitted through the network and does not collect any invoice data.

The ATO has worked closely with many large companies, including Bunnings and Woolworths, to determine the value of Peppol for digitally mature businesses and implementation impacts for their customers and suppliers. These companies are now eInvoicing champions, supporting their trading partners’ transition to this new invoicing channel and reaping mutual benefits.

The ATO are also working closely with eInvoicing solution providers to ensure that their products are eInvoicing ready, including a range of free and low-cost solutions for small businesses with simple invoicing needs. Many small businesses are already enabled via their existing software, making your supply chain more efficient and secure. The more of your trading partners that get eInvoicing enabled the greater the benefits that will be seen by everyone as the network of businesses using eInvoicing grows.

Getting started with eInvoicing has never been easier, with more and more eInvoicing ready products available on the market. The ATO website provides valuable information on eInvoicing and offers resources for businesses to explore their options and get started with eInvoicing. By embracing eInvoicing, businesses can improve productivity, reduce administrative costs, enhance security, and support their ESG targets while also contributing to a more sustainable future.

To find out more about eInvoicing, and to start your exploring your options, visit ATO.gov.au/eInvoicing

*Mark Stockwell Director eInvoicing Australian Taxation Office E: einvoicing@ato.gov.au