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

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“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

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(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

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Compliance

Reduced

administration

Business

intelligence

Better access for

SMEs

Process

efficiencies

Environment

Digital Agenda

eInvoicing – What is electronic invoicing?

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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

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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)

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InvoiceCore

Elements

Invoice Note

Process Controls

Seller

Buyer

Document Totals

VAT Breakdown

Invoice Lines

PEPPOL – Pan-European Public Procurement Online

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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

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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

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Suppliers

Education

LocalGovernment

Central

Government

Health

User’s Perspective: PEPPOL – The Four Corner Model

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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

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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

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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

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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

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End to End & Automatic

• Generation

• Transmission

• Reception

• Processing

Straight Through Processing – Process Flow

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• 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

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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

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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)

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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/

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• 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

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Thank You!

eInvoicing

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