SAP Concur, a SaaS and e-invoicing provider, says that with 80% of invoices to be received electronically by 1 July 2021, e-invoicing will result in a significant decline in government payment cycle times, enabling public sector agencies to return cashflow to suppliers in as little as five days.
In Australia, e-invoicing is based on the successful International PEPPOL (Pan European Public Procurement On-Line) platform. It aligns with the federal government’s cybersecurity focus because it will improve security around government supplier invoice processing and payments.
Matt Goss, managing director, SAP Australia and New Zealand, said, “Government agencies only have a few months to comply with the requirement to receive invoices electronically, and around 15 months to fully adopt e-invoicing, so agencies need to act now to ensure they meet the new ATO requirements.”
According to SAP Concur, there are extensive benefits to Australian business and the overall economy as a result of e-invoicing adoption, with the company citing that - according to the ATO - with more than 1.2 billion invoices exchanged in Australia annually, savings to the economy are estimated to be $28 billion over 10 years - and e-invoicing is also eco-friendly because it eliminates the need for paper, and requires less energy, manual processing resources, and physical storage space.
“Adopting e-invoicing will improve internal government processes, save administrative time and costs, improve data security, reduce the risk and cost of human error, and help get cash back to small businesses much faster. E-invoicing will provide a centralised system for government agencies that will improve the accuracy and timeliness of financial and budget reporting, which will help with better budget planning,” Goss said.
SAP Concur says that for small and large businesses alike, e-invoicing will make the process of doing business with government agencies much faster and more efficient, and it also significantly reduces cost, with a paper or PDF invoice costing businesses around $30 in administrative time to process, compared to less than $10 to process an e-invoice.
And, this does not include the time and cost involved in redoing paper and PDF invoices when an error is discovered.
“E-invoicing eliminates errors and significantly improves efficiencies by ensuring the accuracy of data before the invoice can be submitted,” Goss said.
“It also centralises information, saving time and reducing the risk of error across disparate systems. Importantly, it is highly secure, which reduces the risk of fake or compromised invoices that are often associated with email processes.”
SAP Concur says it recommends that government agencies and businesses clearly understand and manage process changes within the organisation when adopting e-invoicing.
“The safest approach is to engage a trusted e-invoicing software partner. Key things to look for in an e-invoicing provider are: a software expert with local compliance knowledge; an ability for the software to integrate with your organisation’s existing systems to reduce operational risk and cost; and an ability to ensure the solution works across suppliers with e-invoicing and those without.
“While federal government agencies must have e-invoicing in place by July 2022, it is likely to take more time for all Australian businesses to adopt e-invoicing within their organisations. That’s why it’s essential to ensure the e-invoicing solution a business adopts can continue to deliver all the benefits of e-invoicing whether its trading partners use the e-invoicing software or not,” Goss concluded.