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Since January 1, 2021, companies have been required to send their invoices to public bodies electronically using the Chorus Pro portal. Laws are changing, and Article 26 of the amended finance law for 2022 now requires electronic invoicing for transactions between VAT-registered companies established in France. This major change needs to be anticipated now. As an expert in electronic invoicing, Docoon is fully committed to providing its partners and customers with a reliable and sustainable solution.
This article is intended for anyone who still has questions about the scope of the reform and the steps involved . Below the article, you will find an infographic to download on the P2P (Purchase To Pay) process (purchasing cycle), which we hope will be both informative and concise. Want to learn more? You can also download our free white paper on electronic invoicing reform.
1. Electronic invoicing: why prepare for it now?
Companies must now prepare to implement the electronic invoicing reform for several important reasons:
- Advance preparation: The transition to electronic invoicing may require time and resources to set up the necessary infrastructure and systems. By starting now, companies can give themselves enough time to plan, implement, and test electronic invoicing solutions so that they are ready before legal deadlines or customer requirements.
- Legal compliance: Companies must familiarize themselves with the specific legal requirements of their jurisdiction and ensure that they comply with the required standards and formats. Failure to comply with regulations can result in fines and penalties, as well as reputational issues.
- Smooth transition: Implementing electronic invoicing may involve organizational changes and adjustments to internal processes. By starting early, companies can make a gradual and smooth transition, allowing employees to adapt to new working methods and receive the necessary training. A planned transition reduces the risk of business disruption.
- Operational benefits: Adopting electronic invoicing offers significant operational benefits, such as task automation, error reduction, improved efficiency, and cost savings. By starting early, businesses can reap these benefits as soon as possible, improving their financial processes and competitiveness in the marketplace.
- Collaboration with business partners: Business partners and customers are also affected by the electronic invoicing reform. It is important to plan ahead in order to continue working smoothly with suppliers and customers.
2. The challenges of the "Purchase To Pay" process(from purchase to payment)
What are the challenges of the "Purchase to Pay" process in the context of electronic invoicing reform? Here are some key points:
- Automation of purchasing: The reform of electronic invoicing provides an opportunity to automate the purchasing process, from the purchase request to the approval and receipt of goods or services. The challenge is to implement electronic systems and workflows to streamline purchase requests, supplier selection, purchase order creation, etc. This reduces delays, optimizes processes, and minimizes errors.
- Supplier integration: As part of the electronic invoicing reform, it is important to establish electronic collaboration with suppliers. This involves setting up portals or electronic platforms that enable suppliers to send electronic invoices and other procurement-related documents. The challenge is to facilitate the integration of suppliers into these systems, promote the adoption of electronic invoicing, and improve communication and visibility of purchasing processes.
- Automated invoice processing: Electronic invoicing facilitates automated invoice processing in the purchase-to-pay process. Electronic invoices can be directly integrated into accounting and financial management systems, eliminating the need for manual data entry. The challenge is to implement mechanisms for automatic invoice validation, reconciliation with purchase orders and receipts, and notification to the relevant departments for payment. This reduces errors, speeds up the process, and enhances compliance.
- Expense control: Electronic invoicing provides greater visibility and control over company expenses. Electronic data makes it easier to analyze expenses, track cash flow, identify budget variances, and make decisions accordingly. The challenge is to leverage this information to optimize spending, negotiate more favorable purchasing terms, and improve the management of company finances.
- Compliance and traceability: The e-invoicing reform enhances compliance and traceability in purchase-to-pay processes. E-invoices provide a detailed audit trail, facilitating transaction verification and regulatory compliance. The challenge is to implement secure electronic storage and archiving mechanisms for invoices so that they can be easily accessed during audits or inspections.
Download our infographic Organize the purchasing cycle: " The accountant's 4-step checklist"
Download our white papers "How to switch to electronic invoicing"
