Go paperless by sending and receiving eInvoices and get paid faster
eInvoicing is an accurate computer-to-computer data language, and it's not up for interpretation by people or machines. It's as fast as an email, and it means you don't need to send a series of emails or pdf documents to follow up on the invoice status or get paid.
The Australian government will mandate electronic invoicing for all Commonwealth government agencies by the 1st of July 2022 and promises to pay suppliers who use eInvoicing within five business days.
The Australia Taxation Office estimates that the current cost of processing invoices is $27/invoice, and eInvoicing will take it down to $10/invoice.
Australia's adoption of the PEPPOL network in 2019 enabled all private companies and public administrations to bill through PEPPOL. Pan European Public Procurement On-Line (PEPPOL) is the global standard and network being embraced by the government of Australia and New Zealand to electronically exchange invoices and other procurement documents.
Australia adoption of the PEPPOL network in 2019 enabled all private companies and public administrations to bill through PEPPOL. Pan European Public Procurement On-Line (PEPPOL) is the global standard and network being embraced by the government of Australia and New Zealand to electronically exchange invoices and other procurement documents.
eInvoicing delivers efficiencies, enhances compliances, lowers costs, and improves business relationships. The benefits for the Australian government and businesses to use Peppol to conduct eInvoicing include:
Partnered with ATO’s approved access point service provider Storecove we help businesses get set up with AP automation and receive eInvoices into their solution. Schedule a call today to learn more.
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The Australian Commonwealth government identified eInvoicing as a key driver to improve the economy and, in the 2020-21 budget, committed $15.3m to accelerate the adoption of eInvoicing. The government also aims to encourage the business community to follow suit in adopting eInvoicing. In a mid-August 2021 announcement, the NSW government made it easy for small and medium businesses working with the NSW Government to submit and track their invoices with the launch of a new eInvoicing portal. Companies can submit and check the status of invoices with eInvoicing enabled NSW Government agencies through a Supplier hub dashboard.
Minister for Finance and Small Business Damien Tudehope said eInvoicing would improve current interactions between SMEs and the government. “One of the biggest issues for small businesses across NSW is cash flow, and we want to take steps to ensure that properly rendered invoices reach and are actioned by the right teams as quickly as possible.”
Peppol eInvoicing is paperless. It’s a straight-through data transfer that saves time and money associated with people doing data entry from paper or email invoices. The ATO estimates that the current cost of processing invoices is $27/invoice, and eInvoicing will take it down to $10/invoice.
The other significant benefit for businesses that supply government agencies is that the Commonwealth government announced a five-day payment policy for suppliers who issue Peppol eInvoices with contracts valued under $1m. eInvoicing is an accurate computer-to-computer data language, and it's not up for interpretation by people or machines. It's as fast as an email and means you don't need to send a series of emails to follow up on its status.
eInvoices are a computer-to-computer digital format, and digital invoices are more like PDFs that people can read.
No. While Peppol eInvoicing can help enable AP & AR solutions, Peppol is about the format and delivery of eInvoices and does not consider an organisation's business rules for how invoices are processed. For example, if we look at the relationship between Storecove and ACMO, that might make this a little clearer.
ACMO's APAY solution is an Accounts Payable solution. Once it receives invoices, it can help an organisation apply its business rules around processing that invoice. Invoice processing could include anything from GL Coding to PO matching to routing for approvals or validation checks. What Storecove brings to the table is the Peppol Access Point service so that eInvoices can be fed directly into that solution. So while emailed / digital invoices get run through an OCR process to extract information from a page which is then transferred into APAY, eInvoices already exist as data and don't need to go through that process. It is more accurate because eInvoices are literally what came out of the senders' system and not a software application's attempt to read something on a page. Once they are inside the APAY solution, both digital invoices and eInvoices are processed the same way with the same business rules irrespective of their format or how they were received. In short, and in the context of Accounts Payable, Peppol eInvoicing is about a new ingestion channel for invoices; it's not about prescribing new and separate business rules for how you need to process them.
Regardless of whether you are ready to start now or whether this is a project for some time in the future, the first thing you can do is make sure that you have the ABNs for all your trading partners in your finance or ERP system. I’ve found that when compared to New Zealanders that Australians are already pretty good at this as ABN is both a company number and a tax number, whereas, in NZ, they are two different numbers.
The next thing to do is to talk to your existing solution providers. If you have APAY AP Automation, then speak to ACMO. If you have MYOB EXO, then speak to your MYOB partner. If you have TechOne or Oracle or Sage or dozens of other solutions partners, talk to the people you already work with. If they have a plan around Peppol, that’s great. Suppose that plan works for you and matches your timeframes, even better. However, if they don’t have a plan or if their plan doesn’t work for you, or even worse, they don’t know what you are talking about, you need to find someone you can trust. The ATO website is another good place to get info if you want a vendor-neutral starting point.
For businesses that are currently supplying government councils and other governing bodies, the case for faster invoice payment- the proposed 5-day payment guarantee is a significant attraction. For other businesses, it may just be having the conversation about eInvoicing and what advantages it can offer in the future for speed and security.
OpenPEPPOL is a non-profit organisation established under Belgian law whose membership is made up of public and private organisations worldwide. They govern the standards and the network. OpenPEPPOL administers Peppol in multiple countries through the appointed regional authorities responsible for the administration of Peppol within each jurisdiction. In Australia, the Peppol Authority is ATO, and in NZ, its MBIE. The Authorities, in turn, run an accreditation process to validate and certify which vendors can provide access point services to organisations within that jurisdiction.
The Peppol network is a secure network through which documents are exchanged between training partners. Usage of the Peppol network can only be accomplished by using an Access Point to the network, which, as mentioned, has to have accreditation from the Peppol Authority for that region. So to use an imperfect analogy, the Peppol network is like using a cell phone. You and the person you are calling can use different handsets, but each of you needs to use a telco's services before contacting each other. So too, with Peppol invoicing, you and your trading partner can have different finance systems, but you each need to use an Access Point service to eInvoice each other over the Peppol network.
For an organisation to transact on the Peppol network, you need to have what's known as a Peppol identifier. This identifier is globally unique, and it's how your trading partners know that they are transacting with the real you. In Australia, the Peppol ID comprises the ABN, and in NZ, they use the NZBN. Because you have to use an accredited access point to get information into or out of the network, the access point providers are essentially the bouncers or the gatekeepers for the network. We have various responsibilities, such as a Know Your Custom (KYC) obligation to validate that the organisations we connect with are who they say they are. So if you get an eInvoice from someone like BOC Gas, you know that BOC Gas has legitimately sent it.
You can use one access point to send eInvoices and another to receive them. For example, if you are a Xero customer and also an ACMO APAY customer, you can use Xero's Access Point to send eInvoices directly from Xero. However, when you receive eInvoices, you can use the APAY access point (which Storecove provides) to apply your business rules rather than going straight into Xero.
Alternatively, you can use the same service for both sending and receiving.
Much depends on the systems you use and whether the Access Point service is provided by the vendors you get those systems from. You need to be mindful that you can only receive from one Access Point. You can send from as many different ones as you need, but you can only receive from one. So think of it kind of mail or the postal service. If you want to send someone a letter, you can post it in any postbox you like, but you only have one mailbox at the end of your driveway.
The key is to identify where you need the incoming invoices delivered and which system you need them to be delivered into first. So in the Xero / APAY example I used just before, you want the eInvoices to be delivered into APAY so that you can apply your business rules to the way they are coded, approved, matched, etc. You don't want the eInvoices to bypass APAY and go directly into Xero because they haven't gone through your business rules process.
