SAP Business Network E-Invoicing

E-Invoicing: Go beyond conversion of paper invoices to electronic formats

Didier MametBusiness DevelopmentSAP Business Network

© 2012 SAP AG. All rights reserved. 2

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The information in this presentation is confidential and proprietary to SAP and may not be disclosed without thepermission of SAP. This presentation is not subject to your license agreement or any other service or subscriptionagreement with SAP. SAP has no obligation to pursue any course of business outlined in this document or any relatedpresentation, or to develop or release any functionality mentioned therein. This document, or any related presentationand SAP's strategy and possible future developments, products and or platforms directions and functionality are allsubject to change and may be changed by SAP at any time for any reason without notice. The information in thisdocument is not a commitment, promise or legal obligation to deliver any material, code or functionality. This documentis provided without a warranty of any kind, either express or implied, including but not limited to, the implied warranties ofmerchantability, fitness for a particular purpose, or non-infringement. This document is for informational purposes andmay not be incorporated into a contract. SAP assumes no responsibility for errors or omissions in this document, exceptif such damages were caused by SAP´s willful misconduct or gross negligence.

All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differmaterially from expectations. Readers are cautioned not to place undue reliance on these forward-looking statements,which speak only as of their dates, and they should not be relied upon in making purchasing decisions.

© 2012 SAP AG. All rights reserved. 3External

Businesses Are More Reliant on Their Network of Partners than Ever Before

Trend #1: Increasing Complexity of Network New markets, mergers and acquisitions,

global supply chain Increasing number of business partners and

subsidiaries Legal rules and compliance specifications

Trend #2: Accelerated Speed of Business New product and services introductions; new

suppliers and partners Rapid partner on-/off-boarding due to

changing market conditionsForrester Consulting, Joint Industry EDI/B2B Survey, March 2010

1,000+

Interfaces

Partners

500250 750


Business Networks in Procurement & Logistics

Key element for a solid procurement and supply chain strategy

SAP Information Interchange On Demand

Adapt your Business Network as your business grows

Business Networks in Finance

Aligning compliance rules with electronic handling of invoices

SAP E-Invoicing for Compliance On Demand


Drive efficiencies with a state-of-the-art platformSAP Cloud offering

Affordability No upfront license costOnly a predictable quarterly subscription feeShort contractual terms, minimum 1 year (up to 3 years with multi year discounts)No internal hardware / software requirements

Data securityWorld class data centers with third party certificationsQuality Management acc. to European Foundation for Quality Management Service Management Processes acc. to IT Infrastructure Library (ITIL)ISO 9001:2, ISO 27001, SAS 70 Typ II

ScalabilityA fault tolerant and easily expandable infrastructure Virtualized systems using the latest virtualization technology.Fast Scaling Scale out or Split off No bottlenecks in system performance and availability.

TechnologyLatest technology accessible in order to provide contractual SLAs on the services. 24*7 services and supportDon’t care about upgradeAP cloud solutions are always up-to-date and on the leading edge.


The “Extended Enterprise” OnDemand

3rd Party Solutions

SAP Netweaver Process Integration

SAP ERP

SAP SAP BusinessByDesign

SAP Procurement

SAP Supply Chain Management

Warehouse

End customer

…

Financial Services, Government

Logistics Service Providersand Carriers

Retailer

Financial Services, Government

Productionsites

Suppliers

LogisticsServiceProvidersand Carriers

Outsourced Manufacturers

Orders In-/Outbound

Orders Ack. In-/Outbound

Invoice In-/Outbound

ASN In-/Outbound

Delivery Forecast In-/Outbound

Remittance Advice In-/Outbound

Delivery JIT In-/Outbound

Inventory Report In-/Outbound

Self Billing Invoice In-/Outbound

Shipment In-/Outbound

Enterprise Service

Other Processes, Docs, etc.

SAP Information Interchange

…

SAP Information Interchange On DemandRunning a Business Network Goes Beyond B2B : connect, transact, collaborate with real-time content and insights


Simplify the process of adopting e-Invocing

SAP E-Invoicing for Compliance On DemandSend and receive paperless invoices with any trading partner economically – regardless of compliance requirements and data standards


Automate for confident compliance

Use of country specific certificates Using local certificates provided by Trust

and legal Advisers partner Legal Advisers checks country specific

(signature) requirements with local tax authorities and law offices

Actively working in international organizations (CEN) to standardize and emphasis E-Invoicing

Providing SAS 70 report on signature / validation services

Global solution providing local compliance in over 40 Countries

SAP explicitly warrants “compliance” defined as meeting a country’s requirements in VAT or GST law for guaranteeing integrity and authenticity of electronic invoices when signed with an advanced or qualified electronic signature


Accounts Receivable

Going Paperless Can Improve Speed, Accuracy, and Compliance While Reducing Costs

Involves automating electronic invoicing to make financial operations processes faster, more accurate, and less costly to execute.

Outbound E-Invoicing (E-Billing)

How do I improve our financial operations processes?

How do I provide my customers with paperless bills?

How can I standardize and accelerate invoice receipt and retention?

• Improve productivity

• Compliant record keeping

• Complete audit trails

• Sustainability: paperless processes

• Gain control over business processes within the entire business network

• Cost per outgoing invoice

• Eliminate paper and postage

• Speed of integration compliant with customer format mandates

• Shorten customer-to-cash cycle times

• Reduce Days Sales Outstanding

• Elimination of manual data entry errors: cut number of disputes, rejections and re-submissions

• Eliminate manual reconciliation effort

• On-time payment percentage

• Storage cost per invoice

• Speed supplier on-boarding

CFO

CFO

Inbound E-Invoicing

Accounts Payable


Outbound E-InvoicingObjectives, Issues, Capabilities and Benefits

Issues Key Business Capabilities Benefits

Objective: Reducing dependence on paper-based invoices

Best practice solution: Automated, standardized invoice transmission via EDI directly into customer systems

• Majority of invoices are still sent in paper format—driving higher handling costs

• Legal and tax requirements vary by country

• Costs associated with non-standard interfaces to digital signature and other service providers

• Send outbound PDF invoice via E-mail

• Send outbound EDI and/or PDF invoice via E-mail

• Digital signatures

• Legal and compliance checks, depending on country requirements

• Improved DSO through reduced number of missing invoices and streamlining of the customer’s internal review process

• Lower operating costs due to more efficient handling of high-volume processing; savings of handling cost, printer, toner and postage

• Compliance requirements met, regardless of country; no more fines or charges associated with paper-based invoices


Outbound E-Invoicing

SAP Differentiators

SAP Solution

• Provide invoices to your customers in the format they demand

• Provide compliant digital signatures

• Improve productivity of A/R department or your accounting shared-service function

Integration: Integrates with SAP back-end systems for accounts receivables

Support: Solution is covered with enterprise support from SAP

Scalability: Ability to dispatch large volumes of invoices from shared-service centers


Digitally sign Invoice

Send PDF via email

Send EDI

Legal & Compliance Checks


Outbound E-InvoicingProcess Overview

Outbound E-Invoicing provides accounts receivables teams a method to automate and standardize the end-to-end outbound invoicing process to improve productivity, reduce error rates and implement important compliance controls related to invoice processing and transmission.

Process Steps

Initial SetupValidate

E-InvoiceProcess

E-Invoice

• Receive data from ERP system

• Generate PDF (if necessary)

• Validate format (XML, iDOC, PDF)

• Content check (email address, country information)

• Digitally sign document

321

• On-board Business Partner, including creation of profile

• Update customer billing delivery preferences in ERP system


Digitally sign Invoice

Send PDF via email

Send EDI

Legal & Compliance Checks

• Send documents via EDI or email

• Self-archiving of signed documents in ERP system

4Transmit E-Invoice


Accounts Receivable Process

ComplianceChecks

Archiving(optional) 2.

3.

3.

Digital Signature Validation

SAPE-Invoicing

for Compliance

1.

SAP

SAP ERP

Billing Data

Customer B

HubCustomer

A

Email + PDF EDIEDI

Archiving(optional)

multiple outbound options


Inbound E-InvoicingObjectives, Issues, Capabilities and Benefits

• Error-prone manual data entry

• No audit trail

• Excessive cost-per-invoice

• Lost or missing invoices delay payment and hurt vendor relationships

• Receive digitally signed PDF invoice and EDI

• Validate invoice in terms of format and content

• Verify authenticity of digital signature

• Creation of document set which includes result of verification checks and original SAP business documents

• Transmission of document set to ERP for further processing and archiving

• Time savings due to automation

• Redeployment of personnel into higher value-adding activities

• Reduced error rate improves relationship with suppliers

• Improved data accuracy for fewer disputes

Issues Key Business Capabilities Benefits

Objective: Automation and standardization of the end-to-end inbound invoice processesBest practice solution: Automated, standardized invoice receipt via EDI directly from supplier system


Inbound E-Invoicing

SAP Differentiators

SAP Solution

• Receive electronic invoices via standardized interfaces (PDF invoice, EDIFACT D96A, signature/verification file)

• Perform all required format, content and signature verification steps automatically

• Seamlessly transfer invoice data to ERP for further processing, approvals, and archiving

• Improve productivity of accounting department or your accounting shared-service function

Internal Control: Verify documents and signatures for all incoming invoices according to compliance requirements in over 40 countries

Direct Access to Global Partner Network: Leverage SAP’s world class network of business partners to accelerate adoption by your suppliers and increase percentage of electronically received invoices

Straight-through invoice management: Transmit invoices to ERP and invoice processing systems and archiving, improving quality by eliminating manual intervention

Receive Electronic Files

Verification and Compliance

Engine

InboundE-Invoicing

Transmit Data to ERP


Inbound E-InvoicingProcess Overview

Inbound E-Invoicing harmonizes interfaces and processes for inbound invoices while helping companies retain their flexibility in terms of scale (number of invoices) and media (invoice format). This process enables A/P departments to process and prepare invoices for payment.

• On-board Business Partner, including creation of profile

• Update supplier master records in ERP system

• Transfer document set to ERP for further processing in SAP Invoice Management by OpenText

• Transfer document set to archive system

Process Steps

Initial Setup Validate E-Invoice

Process E-Invoice

• Verify and completeinvoice

• Format validation (PDF invoice, EDIFACT D96A, signature file)

• Content validation (receiver information, global checks, country -specific checks)

321

• Verify PDF document

• Convert EDIFACT into target XML IDOC

• Create document set (XML IDOC, signature file, PDF invoice, verification protocol)

Transmit Data

4

Receive Electronic Files

Verification and Compliance Engine

InboundE-Invoicing

Transmit Data


HUBHUB

Accounts Payables Process

EDIPDF/email

Digital Signature Validation

Invoice Recognition

InvoiceProcessing

Document Archiving

SAP Invoice Management by OpenText

Document Archiving & Viewinge.g. SAP Archiving by OpenText

ERP (FI/AP)

SAP

SAP

SAP SRM

Supplier

Hubs and Portals

Document Scan

Payment

iDOC + supporting docs (e. g. signature, verification protocol)

SAPE-Invoicing

for Compliance

Fax

Paper

Email

HUB

SAP Invoice Management by OpenText,

option for OCR


Explaining the different options and further requirements

Signature EDI Any other methods...

signed PDF

signed structured file

can be use with any type of trading partner

Straight forward in EU

further methods to prove integrity & authenticity required (recomm. 94/820/EG)

e. g. prior EDI agreement needed

e. g. requires secure data transfer (AS/2)

some countries require add. signatures or summary reports

Heterogeneous process rules in EU

to be adopted by EU member states by Jan 2013

Business Controls must provide a reliable audit trail between an invoice and a supply (to guarantee Integrity and Authenticity

currently adopeted by Germany and Poland

Unclear if all EU countries will have thesame rules for the audit trail

Technical controls Process controls Business controls

Electronic Invoicing - EU Options

initiated by Invoice Issuer

initiated by Invoice Issuer & Receiver

initiated by Invoice Receiver

Archiving requirements for the (original) electronic file

Receiver‘s acceptance needed


Sample e-Invoicing LATAM Process Overview


Proven Business Impact

24

standardized process interfaces replaced 655 point-to-point mappings

50%greater efficiency and improved customer satisfaction

600business partners connected for 8 processes and 4 million documents

100% paperless within the first 8 weeks with 1,000 suppliers

Over 3 000 SAP customers with 60 000 trading partners in many countries or industries are exchanging business processes and electronic invoices through SAP Business Network.


Speed

3...5xAutomatic adjustment to change, integration or exclusion of business partners

Flexibility

+20...60%Simple adoption of new processes and change of existing processes

Fast integration and consolidation in mergers and acquisitions

Efficiency

+20%Reduced integration effort Standardize Business Processes for B2B

Compliance

Fulfill global Compliance Requirements.

Built-in response to most legal changes – we take care of that

Best Run Businesses run SAP Enabled Business Networks

Thank You!Didier MametSenior Director EMEA Business DevelopmentSAP Business [email protected]+33 6 77 32 45 56

Learn moreCall your SAP representative today, or visit us online at www.sap.com/solutions/technology/cloud/e-invoicing

mailto:[email protected]

http://www.sap.com/solutions/technology/cloud/e-invoicing

SAP Business Network E-Invoicing

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