Līga Januša-Pleskovska

Senior Consultant, Tax Reporting, Accounting and Strategy, PwC Latvia

Juris Boiko

Manager, Tax Reporting, Accounting and Strategy, PwC Latvia

E-invoicing is becoming an important tool for businesses around the world, boosting efficiency, reducing the likelihood of errors, and securing tax compliance. Yet companies that have chosen to outsource their accounting function are not sure about who is to take responsibility for implementing and managing e-invoices. This article examines key roles, responsibilities and principles of collaboration that will help companies implement an e-invoicing system successfully.

What is an e-invoice?

An e-invoice is an invoice that is issued, received and processed by electronic means, typically using a standardised format or platform. E-invoicing automates how invoices are issued and processed, reduces paper consumption, and helps mitigate the risks of fraud and error.

Outsourcing the accounting function

Outsourcing a company’s accounting function means entrusting a third party with the execution of tasks such as bookkeeping, payroll, financial reporting, tax compliance, and invoice processing. This approach enables companies to reduce costs and leverage specialist expertise, while allowing their internal resources to focus on their core business functions. Challenges can arise when it comes to implementing e-invoices and managing the implementation while outsourcing accounting processes.

Who is responsible for implementing e-invoices?

The responsibility for implementing e-invoices in a company that outsources its accounting function may vary according to several factors, such as the outsourcing agreement, local regulations, and the scope of services.

Internal management and compliance officers

Even if the accounting function is outsourced, the responsibility for e-invoicing compliance typically rests with internal management, particularly compliance officers or CFOs. These employees ensure the company meets all legal requirements for the implementation, monitoring and compliance of the e-invoicing system.

The service provider

In some cases the accounting service provider may undertake to implement e-invoicing if the agreement expressly provides for this. Such providers offer a full range of services that include not only invoice processing but also the implementation, configuration and integration of the e-invoicing system with the company’s existing systems, such as ERP.

Collaboration between internal and external teams

Successfully implementing e-invoices in a company that uses outsourced accounting often requires close collaboration between its internal team and the service provider. The service provider executes the technical side, but the internal team must ensure the service provider follows the company’s internal policies, monitors the system implementation, and verifies that the e-invoicing system meets statutory requirements.

Processing and knowledge transfer

Even if a company outsources the accounting function, it’s essential for its internal staff to participate in the process, ensuring compliance and consistent communication. The internal team may need training on e-invoicing procedures so that they fully understand how the system works and are able to resolve any issues efficiently. The service provider should provide detailed information and support to help the company monitor the system and resolve any issues.

Key considerations for successful e-invoicing implementation

• Contract clarity – the agreement with the service provider should clearly define the implementation of e-invoicing, specifying the expected functions, compliance and maintenance.
• Regulatory compliance – e-invoicing legislation varies from country to country and the company should ensure its e-invoicing system complies with local rules and reporting standards.
• Systems integration – e-invoicing solutions should be easily integrated with the company’s existing systems (accounting, ERP and management systems) to secure accurate exchange of data between different systems.
• Constant monitoring – regardless of who implements the e-invoicing system, constant monitoring is required to ensure the system continues to operate according to the legislation and the company’s policies.

Key takeaways

Implementing e-invoices in a company with outsourced accounting is a team effort requiring the involvement of both its internal management and the service provider. While the service provider often takes on the technical execution, the company’s management is responsible for strategic oversight and compliance.

Clear communication, contractual agreements and regulatory requirements are essential components of a successful e-invoicing implementation. With a thoughtful and collaborative approach, companies can reap the full benefits of e-invoicing while maintaining full compliance and accuracy in their financial processes.