Code of practice and glossary of terms

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  • 1. WORKSHOP ELECTRONIC INVOICES, PHASE 3 Open Meeting 12 December 2011, Brussels Code of Practice and Glossary of TermsPhillip H. SchmandtPT5 CEN e-Invoicing Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reservedWorkshop Phase 3  2008 CEN – all rights reserved 10/01/2010 1
  • 2. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010Reaping the Benefits of Electronic Invoicing for Europe (2 December 2010)“CEN should develop by end of 2011, a Code ofPractice taking into account the work of theExpert Group on e-invoicing. This Code ofPractice, to be adopted by trading parties,service providers and public authorities, shouldinclude a consistent terminology and a definitionof roles and responsibilities of the distinct actorswithin the e-invoicing process.” Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2011 CEN – all rights reserved 12/12/2011 2
  • 3. 2 Forward………………………………………………………………………………………………………………33 I. Introduction………………………………………………………………………………………………….34 A. References and Resources………………………………………………………………………………..45 B. Core Principles………………………………………………………………………………………………46 II. Code of Practice for Trading Parties……………………………………………………………………57 A. When issuing or receiving unstructured data electronic invoices (e.g. pdf), taxable8 persons should:…………………………………………………………………………………………………59 B. When issuing or receiving structured data electronic invoices (e.g. xml or EDIFACT)10 taxable persons should:………………………………………………………………………………………..611 III. Code of Practice for Service Providers………………………………………………………………...712 IV. Code of Practice for Public Administrations………………………………………………………….713 Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 Core Principles Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 3
  • 4. Legislative Compliance Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 Solution Neutrality Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 4
  • 5. Auditability Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010Proportionality Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 5
  • 6. Interoperability Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010Responsibility Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 6
  • 7. Code of Practice for Trading Parties Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010II.A. When issuing or receiving unstructureddata electronic invoices (e.g. pdf), taxablepersons should: Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 7
  • 8. II.A.1) Ensure the invoice represents anactual supply of goods or services and is storedwith appropriate records establishing this fact inaccordance with the business‟ internal controlprocesses. Business internal controls thatalready achieve this in a paper environmentshould be sufficient when invoicing electronically. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010II.A.3) Determine how the authenticity of the origin, the integrity of the content and the legibility of the invoice will be ensured. Taxable persons are free to choose how these requirements will be met. i) Examples of how authenticity of the origin and integrity of the content can be met include business controls that create a reliable audit trail between an invoice and a supply, or technologies such as EDI or qualified electronic signatures. ii) Practical information on how these methods can ensure authenticity and integrity can be found in the Compliance Guidelines and the E-invoicing SME Enablement CWA. The Compliance Guidelines also provide practical information on achieving legibility. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 8
  • 9. II.A.7) Consider migrating to usingstructured invoices as an enabler to more fullyreaping the benefits of electronic invoicing,ideally a structured invoice based on an open,royalty free standard. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010II.B. When issuing or receiving structured dataelectronic invoices (e.g. xml or EDIFACT)taxable persons should: Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 9
  • 10. II.B.4) Confirm that the intended invoicerecipient would accept a specific Format ofelectronic invoice and has the appropriatetechnology to receive and process structureddata electronic invoices. The issuer and receiverof the electronic invoice must agree in advanceon the Format that will be used, the transmissionprotocol to be used and the format of theelectronic documents to be exchanged.Preferably, this agreement should be explicit tofacilitate subsequent evidence, but is notrequired to be in writing for purposes of VATcompliance. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010II.B.9) The Format in which invoices areheld may be converted to other Formats in acontrolled and auditable process, providing thatthe VAT information remains correct (i.e. theintegrity of the content is not affected). Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 10
  • 11. III. Code of Practice for Service Providers Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010III.2) Service Providers should conduct theiroperations in accordance with the ConformanceCriteria or similar codes providing trading partiesequivalent protections and promulgated by aninternational standards organization. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 11
  • 12. III.3) Service Providers should use and supportroyalty free standards for invoice contentpublished by international standardsorganizations, including as an example theUN/CEFACT Cross Industry Invoice. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010III.4) Service Providers operating in a fourcorner model should interoperate with otherservice providers by use of the CEN ModelInteroperability Agreement or an agreement thatoffers substantially equivalent protections totrading parties and is promulgated by an openand neutral organization. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 12
  • 13. IV. Code of Practice for Public Administrations Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010IV.1) All public administrations should encourageadoption of this Code of Practice by businessesand service providers. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 13
  • 14. IV.2) Public administrations should promote theuse of a consistent terminology for electronicinvoicing by using the Glossary of Terms. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010IV.3.i) If a taxable person already usesbusiness controls with paper invoices toestablish a reliable audit trail between the invoiceand a supply of goods and services and thosebusiness controls ensure authenticity of originand integrity of content, then those businesscontrols also suffice to demonstrate authenticityof the origin and the integrity of the content of theelectronic invoice and no additional technologiesor processes are to be required for compliance. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 14
  • 15. IV.3.ii) Public Administrations should publishclear and uniform guidelines on what constitutesbusiness controls that create a reliable audit trailbetween the invoice and a supply of goods andservices and ensure authenticity of origin andintegrity of content. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010IV.3.iii) Public Administrations should notrequire businesses to implement controlmeasures for audit and/or compliance purposesthat are disproportionate to their individualcircumstances. Circumstances that must betaken into account include, but should not belimited to, the size, activity and type of taxableperson and the number and value of transactionsas well as the number and type of suppliers andcustomers. Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 15
  • 16. CEN Phase 3 E-invoicing Glossary of Terms Consolidated Glossary Open Meeting, CEN WS eInvoices III Brussels 12 December 2011 2005 CEN – all rights reserved  2008 CEN – all rights reserved 10/01/2010 16