What is e-invoicing and is e-invoicing mandatory?

Moving to electronic invoicing  (e-invoicing) is no longer an option for businesses, it is becoming mandatory in some industries. Propelled by the goal of decreasing payment cycle times and costs and increasing efficiencies, mandatory e-invoicing legislation is on the rise, driving the transition from paper to electronic invoicing and archiving.

The public sector is one of the first industry segments to shift towards e-invoicing. Australian federal government agencies must have e-invoicing in place by July 1, 2022. The Australian and New Zealand governments are also strongly encouraging state and local government agencies to adopt e-invoicing.

What is e-invoicing?

E-invoicing is the automated digital exchange of invoice information directly between a buyer's and supplier's accounting systems. With e-invoicing there is no longer a need for businesses to generate paper-based or PDF invoices that must be printed, posted or emailed. Buyers will no longer need to manually enter or scan these into their accounting system.

E-invoicing uses a predefined electronic format. It improves efficiency, reduces cost, and gets supplier invoices paid much faster. Read our E-invoicing FAQs  for answers to our most frequently asked questions.

What happens if an organisation doesn’t adopt e-invoicing?

Australian federal government agencies are mandated to adopt e-invoicing by the Australian government before July 2022, otherwise they could face repercussions. Other organisations that don't adopt e-invoicing face delayed invoice payments, higher costs, and risks of errors and fraud associated with manual invoice processes.

How to prepare for e-invoicing

1. Seek expertise. It’s important to have a clear plan for long term success and seek expertise from a trusted software partner with public sector experience.

2. Be flexible with implementation. Even though e-invoicing is based on PEPPOL open standards, it is not a one-size-fits-all solution.  The right e-invoicing solution will seamlessly integrate with your organisation’s existing applications, and deliver benefits across all suppliers whether they use e-invoicing software or not.

3. Measure the business impact. The chosen e-invoicing solution should immediately begin to deliver a return on investment through improved administrative efficiencies, a significant reduction in manual processing, and faster payment cycles.

Download our Guide to e-invoicing and Peppol in Australia and New Zealand for handy information and useful tips to help get started.