Not all superheroes wear a cape to work. However, each company integrates into its teams real hidden talents who occupy a central place in their proper functioning and especially during this period. In this sense, the financial teams in charge of accounts payable play a special role which has been greatly enhanced during the health crisis we are going through.
Companies have indeed discovered how crucial they play a role in business continuity, cash flow management, forecasting, budgeting and more.
Savvy businesses know that empowering accounts payable is key to unlocking the agility they need to survive the pandemic. But the pandemic is not the only reason the accounts payable teams have suddenly gained recognition. This new role at the center of business strategy began with changes in global tax regulations.
Towards a new tax system
The champions of globalization have long dreamed of a single and standardized tax system for the whole planet. But even if this prospect remains distant, recent years have seen a move towards greater transparency and a better understanding of cross-border tax regulations, which could form the basis of future global standardization.
Continuous Transaction Control (CTC) systems are being developed to address the perennial – and so far difficult to combat – problem of corporate tax evasion. It is not only a problem for countries with a historically lax approach to tax enforcement, but the entire budget of the European Union that can be impacted.
In addition, with the lockdowns which further dry up national taxes, countries must imperatively recover their revenues. And the CTC systems look very promising: in Brazil, they have helped authorities raise an additional $ 58 billion, while in Mexico, collection has increased by a third.
The most popular form of CTC around the world is electronic invoicing. The benefits of CTC are obvious, but they place a heavy burden on businesses, forcing them to prove the validity of every invoice as it is generated. And that in turn requires effort from the vendors and the IT teams that support them. Global standardization is still a long way off, and as of now, many countries have their own set of requirements for sending and receiving invoices.
Adapt to this complex situation
Adapting existing tools and systems to meet new requirements can be particularly difficult. This is a common problem among global organizations that need to adapt to the shift to e-invoicing in different markets. Technology may be the beginning of the answer, but those looking for a quick fix should understand that older ERP systems are not flexible enough to meet new demands. Overcoming these problems leads to the use of workarounds and to the increase in the use of manual interventions which negate all the advantages that electronic invoicing should generate.
Support teams in their challenges
Different projections already predict that by 2025, 75% of all B2B invoices worldwide will be exchanged digitally in real time. As global businesses embrace this complex new layer of country-by-country compliance, those that manage the challenge best are those deploying digitized systems that allow them to scale with speed and full compliance. It is increasingly recognized that a more proactive attitude towards these changes can unlock a number of operational benefits for accounts payable, such as greater accuracy, reduced exceptions and related errors. manual processing.
Organizations also recognize that the benefits of digitization extend far beyond managing invoices and payments. The same systems that ensure compliance with the new CTCs also offer a number of business advantages and will prove to be a crucial competitive advantage in the search for new markets. In doing so, companies will be able to evolve favorably in a complex global environment by allowing their finance and accounts payable teams to fulfill their new pivotal role perfectly.