Digital transformation is imperative for all businesses, from small to large enterprises. That message comes from almost every keynote, panel discussion, article, or study related to how businesses can remain competitive and relevant as the world becomes increasingly digital. In this era of digital transformation, digital technology is integrated into all areas of a business, fundamentally changing how you operate and deliver value to your customers. It, therefore, transcends traditional roles like sales, marketing, or even customer service. It goes beyond businesses trying to meet the changing needs of the market and stay ahead of the competition. Also, in accounting and tax compliance departments digitization is becoming increasingly important. The automation of recurring working processes and the optimization of business processes promise considerable cost and time benefits. Data science and modern data analysis software improve planning and forecasting and enable long-term profitable decision-making based on sustainable reporting with established findings. Now more than ever, companies are looking to digitize their business. New standards call for new strategies, technologies, and tools to thrive and build a solid base for the future. While digital transformation is predominantly used in a business context, it also impacts other organizations, such as governments and public sector agencies. Because of that, digital compliance aspects play an essential role in digital transformation projects.
This rapid technological change does not only impact your business processes but also the people that need to get used to working with all this new technology and digitally optimized processes bringing along many challenges for you as an organization.
“Accounting and Taxation 4.0”: a guide to help the CFO on his digital transformation journey
Prof. Dr. Peter Preuss has published his German book “Accounting und Taxation 4.0” to address the challenges that a CFO will face from an accounting and taxation point of view during his digital transformation pathway. PIKON has contributed to this book with the following co-authors:
- Tommy Beckers, Managing Partner at PIKON Benelux NV and Head of Competence Center for Legal Requirements at PIKON International Consulting Group GmbH
- Olga Berendeeva, SAP ERP Consultant at PIKON Benelux NV
- Christian Masiak, SAP ERP Consultant at PIKON Deutschland AG
They have co-authored and written a chapter on how to use SAP to achieve strategic, long-term compliance with country-specific legal requirements, such as mandatory e-invoicing.
Ensuring compliance with local legal requirements as a strategic part of your digital transformation roadmap
The trend toward a “digital government” has shifted the emphasis away from optional to mandatory electronic tax compliance. All around the world, tax administrations are using technology more than ever before to collect and analyze more data from taxpayers, often in real time or near real time. Instead of being an optional “facility”, the use of B2B, B2C and B2G e-invoicing and digital tax reporting is now a mandatory obligation in many countries, with severe penalties for non-compliance.
Legal requirements and initiatives, such as CFDI in Mexico, SII in Spain, SDI in Italy, RTIR in Hungary, DIAN in Colombia, XRechnung in Germany, MTD in the UK, etc. are drivers for other countries worldwide to define their own legal requirements for the electronic submission of tax-related data to local tax authorities. Internationally operating organizations are facing new challenges to manage and monitor this flood of country-specific legal requirements. Because of that, an ERP system, such as SAP ECC or SAP S/4HANA, should provide an integrated, standard solution to ensure compliance with all these legal requirements. With their SAP Document Compliance solution (formerly known as the SAP eDocument solution), SAP provide such a solution to convert transactional data, coming from SAP ECC or SAP S/4HANA, into the required XML formats and to electronically exchange this XML data to local tax authorities. With SAP ACR (Advanced Compliance Reporting), SAP also provide an integrated solution to generate legally required tax reports and submit them to local tax authorities.
Next to achieving compliance with legal requirements, the implementation of e-invoicing processes also carries quite a few benefits for B2B organizations, such as the reduction of manual processing errors, a faster creation and submission of invoices and increased transparency.
In Prof. Dr. Peter Preuss’ book “Accounting und Taxation 4.0”, PIKON provide many insights and best practices on how to make your SAP system (ECC or S/4HANA) compliant with country-specific legal requirements, using SAP Document Compliance. Next to that, the book also provides many strategic tips and tricks on different other accounting and taxation topics.
Please leave a comment in the Comments section below if you want to order this book or if you want to have more information on how to design your own e-invoicing or tax reporting strategy as part of your digital transformation roadmap. You can also click the following button to request a web-meeting and ask us your questions and get our best practice methods and recommendations on how to make your SAP compliant with different legal requirements. I am happy to help you.
PIKON’s Competence Center for Legal Requirements
The use of digital technologies for electronic tax compliance, such as mandatory e-invoicing, is on the rise and is quickly spreading around the globe. How can you manage and monitor all these different legal requirements within your SAP system? How to stay on top of all updates and changes to country-specific legal requirements? How is long-term compliance ensured? How to avoid penalties for non-compliance at all times? What is the best strategic solution for your own SAP system? How does this SAP solution fit into your own digital transformation roadmap? How to submit the increasing data volumes in a secure and compliant way to local tax authorities?
In order to provide you with best practice experiences and strategic advice/ solutions for these questions, I have established our “PIKON Competence for Legal Requirements”. With our “Competence Center for Legal Requirements”, we have up-to-date knowledge about the different country-specific legal requirements all over the world, and how to ensure that your SAP system and business processes meet these requirements, with the desired customization for your company. This ensures that our team of experts are extensively trained and experienced thanks to the many projects we did over the years. These projects include country-specific legal requirements for e-invoicing, tax reporting, SAF-T, more general accounting standards (e.g. Lease Accounting under IFRS16). Next to that, we have also developed own SAP Add-Ons to ensure compliance with legal requirements, such as our MTD-VAT UK SAP Add-On and our VAT Poland – Whitelist Check SAP Add-On.