Digital Invoice Processing: Great Potential And New Opportunities

Digital transformation is extremely slow. It becomes evident in the accounting departments of many companies. Here the paper is still used for printing, stamping and mailing. Included…

There is no breakthrough invention without an expiration date. Today this applies equally to light bulbs and corded telephones. And after more than 2000 years of success, the paper is gradually coming to an end – at least if one can believe the bold predictions of the futurologists.

This may be the case in many areas. However, the invoicing departments of most companies seem to be successfully bucking the zeitgeist: According to a current Bitkom study, only 13 percent of the companies surveyed were exclusively digitally processing invoices. Compared to 2016, this is even a drop of five percentage points. The administration continues to insist on the traditional form of invoicing – and relies on requests for payment by traditional mail.

Other Countries Are Further With Digital Invoice Processing

In most other countries, digital invoice processing has long been a step further: accountants in public administrations have been working exclusively with electronic invoices for four years. At the beginning of this year, the rules in the Alpine state were expanded to include the entire business-to-business exchange of invoices.

The Neutral Standard For The Use Of E-Invoicing

The so-called E-Invoicing Act, which came into force on November 27, 2018, creates a binding legal basis for the first time. A technology-neutral standard for the use of e-invoicing is established in all countries. It is now the case that all federal ministries and constitutional bodies must receive and process electronic invoices. For public clients at the state and municipal level, the EU directive will apply from November this year; on November 27, 2020, electronic invoicing to public clients of the federal government is generally mandatory. The subject of e-government is becoming a concrete reality.

This has lasting consequences for the authorities and a large part of the private sector. After all, more than half of the companies in this country have business relationships with public or primarily public institutions. This also includes hospitals, universities, schools, energy suppliers and museums. The fact that the entry into digital transformation is so stuttering, especially in an industrial nation that boasts a particular affinity for bureaucracy, can no longer be objectively justified – and certainly not financially.

Great Savings Potential With E-Invoicing

Because switching to e-bills is worthwhile: According to current estimates, the savings potential for switching to digital invoice processing is 225 billion euros per year. According to a study by Capgemini, a company can reduce costs by up to 75 per cent with digital invoice processing processes. This is not just about paper consumption or the avoidance of storage rooms for archiving files.

In contrast to electronic processes, manual invoice processing is more error-prone due to accidental number rotations or missed deadlines due to lengthy workflows—long correction loops and complex approval procedures in particular cause unnecessary delays.

In the meantime, more and more companies are recognizing the potential of digital alternatives – and are relying on software-based solutions. Enterprise content management systems (ECM) such as email from OPTIMAL SYSTEMS offer the right tools for completely digitized invoice processing. Invoices received by post or email are digitized by batch scan and data extraction and stored directly in the archive of the ECM system. Interfaces to the existing financial accounting system guarantee a comparison of the stored data and a check for their correctness.

The tools provide numerous helpful features for this purpose: workflows, dunning deadline management, substitute regulations and resubmissions. The advantages: Thanks to digital invoice management, controllers and accountants benefit from shorter processing times, greater transparency and lower error rates. And last but not least, they save paper.