Latin America E-Invoicing
Global Platform. Local Compliance.
Today’s Agenda
Steve SpragueVP, Marketing & Product Strategy
Invoiceware
Presented by:
Catherine LiaoHead of Presales
1. Tradeshift Introduction
2. e-Invoicing in Latin America
3. Achieve 100% compliance in LATAM with Tradeshift
Tradeshift Business Cloud
A cloud-based platform enabling business interactions including e-Invoicing, workflow, payments, vendor management and more.
196
Countries
5mil.+
Businesses
15mil.
Invoices
$200bn
Spend
E-Invoicing with Tradeshift
• There are no barriers to join, all companies can sign up and start sending e-invoices for free.
• Buyers and sellers can interact and collaborate in real-time
• A rapidly growing eco-system of applications supporting enterprise invoice presentment and payment (EIPP) processes.
• Companies can extend business processes onto Tradeshift by installing or building their own apps.
E-Invoicing Challenges for Multinationals
Domestic e-invoice &
Cross Border
Domestic Invoices subject to electronic mandates
Cross-Border – still predominately paper
VATTax Remittance
Supplier VAT deductible only from gov’t valid invoices
Coordination of Credit/Debit notes to adjust gov’t registered taxes once goods accepted
PO usage on the rise but still low E-invoice formats don’t support “Straight Through
Processing” – need ability to append data
PO Usage“STP” Capability
SupplierCollaboration
Master Data & Onboarding Requirements Payment Status, PO Append, Dispute
Management, Supply Chain Finance
Different e-Invoicing provider in each country Complex legislation equals high internal support
costs
Multiple Local Vendors
Cross Border
E-Invoicing in Latin America
Differences to other Regions of the World
Different Types of Countries
• Mandated electronic invoicing: Brazil, Mexico, Argentina
• Expanding Countries: Chile, Guatemala, Uruguay, Costa Rica, Colombia
Domestic versus Cross Border
• Domestic equals VAT tax and is subject to country mandates
• Cross Border is predominately paper
Mandates Constantly Evolve
• Can change 3-4 times per year as the tax regulations evolve
• Average multinational spends 2600 hours a year managing Brazil issues versus an avg. of 80 hours a year in other countries
Government in LATAM• Mandates the use of electronic invoices• Mandates that supplier must make e-Invoice available to Buyer• Mandates the Format of the Invoice• Requirement of Supplier Invoice: Approved and Accompany the
Truck• Increases accuracy of what was ordered, shipped and invoiced
• Invoice can arrive even before the Goods
Paper Invoices Supplier Rollout Multiple Formats Accuracy Timing
X X X X X
Gov’t Mandates for e-InvoicingEliminate Common Roadblocks
Real-Time E-InvoicingBaseline Compliance Process Sets the Stage for Straight Through
ProcessingBrazil Real-Time Compliance Mandates
• Real time integration with Brazilian Tax Authority (SEFAZ)• For Accounts Payable – Goods Nota Fiscal, Service Invoices at City Level & CTe -
Transporation • NF-e received electronically by recipient in advance. Must be validated and any
returns accounted for via “return order process”• SEFAZ does not validate your taxes in real time but they do data-mine to check
later• Brazilian companies are responsible for accurate taxes of their suppliers as well
Paper
Electronic
Inbound A/P
• Paper not authoritative for compliance
• Suppliers must provide XML electronically
• Step 6 (required) sets up opportunity for automated matching & “straight-though” processing.
5
E-Invoicing in MexicoCompliance Update
December 31, 2013
– CFD is Repealed
– There is NO “Grandfather” clause – everyone must switch
• Includes all current CFD Users
• CBB (paper) allowed only for companies > $250K Peso (~20K US Dollars)
Mandated Inbound ValidationMexico Moves to CFDI
Mexico SAT - Real-Time Compliance Mandates
• Real time integration – legacy was a batch process• Invoices must be registered and approved before being sent• Printed CFDI is also a valid, legal invoice, XML must be archived for 5 Years• CFDI may be received electronically in advance. Must be validated as authentic
before payment.• Each outbound e-Invoicing solution must also provide for inbound validation as well• IMPORTANT: Step 6 – You do not want to pay invalid invoices – Audit Risk & You
Assume Tax Issue
SEFAZ Solution – Two Way Process Orchestration via NFE “events”• NFE is acknowledged by the receiving CNPJ through event posted back to SEFAZ. • NFE must be acknowledged within 180 days initially, and eventually before
shipment as phased roll-out progresses. • Greater burden on receiving CNPJ, but many large receiving CNPJ are pushing for
these changes to guard against ghost transactions in the first place.• Solution very similar to EMCS for Alcohol/Tobacco/Energy within Europe
Draft, subject to change
Bi-Directional Process Orchestration with SEFAZ as the
Mediator Between Parties
100% LATAM compliance with
Tradeshift
Considerations for E-Invoicing
Compliance
• Avoid ~$250 fine per invalid invoice• e-Invoice received must match the e-Invoice previously
registered with the Tax Authority. • Valid invoice = Okay to Deduct VAT on remittances to
Government.
AP Efficiency
• If PO backed, does invoice = PO = Goods Receipt? • If not PO backed, does commodity manager or buyer
approve? • Have the Goods Arrived and been processed?
Finance Optimizatio
n
• Inability to optimize cash flow (e.g., Missed Discounts)• Liquidity concerns for supplier operations• Short-term investment of cash
A single process to address Fiscal Compliance (OK-to-Deduct) and Commercial Compliance (OK-to-Pay)
Local language phone support
Flexible supplier connectivity options
Highest supplier value proposition
No supplier fees!
LATAM Compliance App(powered by Invoiceware)
How Does It Work?
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100% Compliance in LATAM
Guarantee Compliance– Full AP and AR invoice validations
– Immediate upgrades to accommodate any changes in mandated regulations
– Ensure fiscal and commercial compliance
Streamline Business Processes – Eliminate configuration issues
– Cut high cost of localizing & configuring ERP installation
– Support in a local language
Remove Risks – Eliminate the risk of audits, stiff penalties and potential criminal
charges
– Avoid receiving and posting invalid invoices
– Guarantee your ability to ship, collect money, and legally file local taxes
Let Tradeshift assist with your LATAM E-Invoicing rollouts.
Q&A