Years ago we saw it in Denmark, more recently we’ve seen it in Brazil and soon we’ll see it across Mexico too. When a Government mandates electronic processes for its suppliers, the knock on effect is exponential. So when Mexico announced that it will be requiring over half a million suppliers to start invoicing them electronically, the true impact will soon be many many times that.
The move, announced last week, includes a shift to an updated local CFDI file standard, which may be unfamiliar to many of the world’s biggest enterprises. This hits home the shifting challenge for these global organizations when it comes to juggling compliance across the world. It’s not a new problem — but there are new solutions.
The legislation applies to all companies trading over $20,000, with no exceptions, and is due to take effect by the end of the year. The team at Invoiceware International, which integrates directly with Tradeshift to help our users reach these markets without the usual compliance headaches, have the best summary of the technical details of the changes here. (Especially useful if your Spanish is a little rusty or you don’t fancy leafing through 36 pages of legislation.)
How do I manage the CFDI changes?
At the top line, Steve Sprague also gives a good outline of the key things you should know on Finextra:
Don’t wait: there are literally hundreds of thousands of organizations that will need to comply and a limited number of vendors to meet the requirements.
This is not a trivial project: the legislation and required business processes will affect your ability to ship, your ability to collect money from your customers, and your ability to legally file your taxes in Mexico.
Vendor selection is key: As the project will affect your ERP system, ensure your vendor understands the process, has knowledge of the ERP system, provides an end to end solution, and speaks both Spanish and English natively – or you might find yourself in a never ending project.
Both AP and AR are required: The legislation for CFDI requires both the production of electronic invoices when you are the supplier sending to an end customer (Accounts Receivable) and when you are the buyer receiving invoices from your supplier (Accounts Payable). Both processes have their own legal and technical requirements.
Join us to learn more and ask questions
In the meantime, we’ll be hosting a webinar with Invoiceware International that will walk you through the challenge, give you the opportunity to ask any questions and help you get a head start on your journey to confront it.
But make no mistake. This is the new normal. It’s not a matter of if ebusiness will become the standard, it’s when. And the benefits will kick in as soon as you overcome the first hurdles.