E-Invoicing Solutions for SAP ERP
Before understanding the concept of SAP or any Enterprise resource Planning or ERPs, one needs to understand the basics about what e-invoicing actually is. E-invoicing or generally termed as electronic invoicing is a system of invoice generation in which the business to business or B2B invoices are uploaded via any electronic media and are authenticated by any designated portal. One can simply define a e-invoicing system as the online or electronic invoicing system. After the successful authentication from the designed website, a unique and very confidential Invoice Reference Number (IRN) is generated as a form of E-invoicing for each invoice by ERP. This electronic number or IRN which is generated with each invoice by the IRP or invoice registration portal is digitally signed and it comes with a QR code which is very unique with reference to this specific IRN.
Now if we look at the introduction of E-invoicing in GST then we may notice that the government did this mainly to get rid of the fake invoices that were present and were generated in the previous decades through the old systems. Besides this fact, the process of filing the returns is also made easier for businesses as the invoice data generated through E-invoicing is already uploaded and registered by a centralised portal. So when a person files an E-invoice through the IRP or the Invoice registration portal, the invoice is automatically collected by the portal and is delivered to the government for further processing under GST. This process of generating IRN through the IRPs is called as E-invoicing under GST.
Despite of the fact that the invoices that are generated through different software looks like they are all the same, any computer system can’t understand all of them and thus they need business users who are to handle understanding the invoices. For this reason many employees take the help of accounting software. In the current market, there are thousands of accounting platforms or software that generate invoices in all forms, but here lies the problem. The GST Portal can’t understand them all at once. So the system of E-invoicing has been introduced to get a unified and singular format used everywhere for the same purpose. It is more of a standardization of all the invoicing system under one singular method.
The basic aim behind the usage ad adoption of this system of e-invoice system is to increase the returns as well as reducing the challenges that are associated with the GST invoicing in the earlier times. This is achieved with the completion of IRP System and designing which shares the invoice directly to the GST System and the e-way bill system. Thus, this continuous uploading of invoice ensures that the details that are required for the returns are stored in a correct manner.
Some of the KEY benefits of E-invoicing under GST are listed as follows:
- They reduce the time required and paperwork associated with the invoice details in different forms. This is more like a one time upload process and is prepopulated.
- A part of the e-way bill is automatically captured and only the details of the transporter are required to get updated.
- Substantial decrease in the input data verification by the GST system
- Tracking down the invoices is made easier
- The B2B transactions are now easier to monitor.
- Increase in the efficiency by the tax department against the fake invoices that were occurring earlier.
ERP's and E-invoicing
Enterprise Resource Planning or commonly known as ERPs are the management of every information and resources that are associated with a company’s operations by using integrated systems and computers. These simply refers to the type pf application or software that many organizations use to manage and monitor day-to-day business activities like procurement, accounting, project management, compliance and risk management thus ultimately monitoring the supply chain. These ERPs also include enterprise performance management, software that helps plan and budget various activities of an organization thus helping them monitor and plan their financial budgets more effectively
What’s SAP ERP?
SAP ERP is an enterprise resource panning or ERP software that has been developed by a German company namely SAP SE. This software incorporates the most important and basic functions that are involved in any business. SAP is a leading organization which provides Enterprise Resource Planning or ERP Solutions and the associated services. There are tones of packages that are offered by the company involving ERP solutions. But in this context, we are particularly interested in understanding the working procedure of SAP ERP and its effectiveness in the e-invoicing system.
SAP Business one or simply called as SAP One is an industry leading GST-ready ERP software that facilitates reporting of e-invoices automatically which are generated during GST returns. The introduction of B2B e-invoicing under the GST system has greater implications that authenticates the B2B invoices and returns electronically with the help of GSTN. E-invoicing in any enterprise business system is generally a business to business or B2B invoice that is generated electronically by GSTN for usage in the ERP in the future. The GST invoices are continuously created by the accounting software and invoices are generated by the ERP software like the SAP One. After the generation of these invoices by the SAP One, they are submitted to the invoice registration portal or IRP. These IRP returns generated through the SAP Business One are attached with a unique Invoice Reference Number after they are digitally signed and then at last they are added with a QR code for easier processing in the future.
It is then sent automatically through any electronic media over the internet, rather than preparing manually and then posting it with physical means like paper. These IRN can be easily integrated into any customer’s SAP ERP or any third party systems. The SAP Business One ultimately reduces the human efforts and do all the work without any paper thus getting rid of different processes involved in the generation of the e-invoice. This software automatically handles actions thus sending and creating CSV or any PDF as well as XML format documents needed for the same. The SAP ERP not only makes it easier for any business user to get the e-invoice and return filing easier but also helps the user to process them more conveniently.