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Practical steps to a smooth transition to SAP HANA

Presented at HANA 2016 in Las Vegas

This video is hosted by SAPinsider and sponsored by itelligence. Successfully transitioning to SAP HANA or SAP S/4HANA takes careful planning and consideration. Common questions include: What is the difference between SAP versions 1503 and 1511+? Will we migrate to the cloud or stay on-premise? What are the prerequisites to move to SAP HANA? Do...

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A Complete Guide for Managing Contingent Workers in SuccessFactors Employee Central

Learn how to set up and configure the new (as of the August 2015 release) Contingent Workforce functionality in SuccessFactors Employee Central. Gain an overview of the process for handling the contingent workforce, and how to manage vendors and work orders, activate the Contingent Workforce management functionality, set up security roles, and access and understand…...

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Live from SAPinsider Studio: Jan Jackman of IBM on Digital Reinvention

 Jan Jackman, Vice President, Cloud for Enterprise Applications, IBM, visited SAPinsider Studio at the 2016 IoT Conference to discuss the importance of digital reinvention in the cloud for SAP customers. Topics of this interview include how to devise a hybrid IT strategy, benefits of the SAP and IBM alliance, and how customers are embracing digitization…...

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How Cloud Is Disrupting the “I” in HRIT: Ignore It at Your Peril

HR 2016 Keynote by Yvette Cameron, SAP SuccessFactors

The dynamics of engaging employees are changing in today’s disruptive, digital business. In this keynote address from SAPinsider’s HR 2016 event, Yvette Cameron, Global Head of SAP SuccessFactors Strategy, talks about how to drive technology to improve employee engagement and satisfaction. She shares SAP’s cloud strategy around human capital management with a focus on continuous…...

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How to Select the Most Suitable Active Budget Availability Control Solution for Your Organization

Learn about the different tools available in an SAP system to implement active budget availability control and how to select the most appropriate tool for your organization based on its financial, cash flow, and budget control objectives. Key Concept Organizations of nearly all types and sizes hold a budget. The budget is a monetary depiction…...

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Automate Your Business Blueprint Generation for SAP Solution Manager 7.1

Many companies struggle with the documentation of the business processes they use in their productive SAP systems. Several applications from SAP and its partners are available to solve this challenge, but require a significant effort. A new ABAP program provided by SAP Solution Manager requires a very low effort to build an SAP module-oriented Business…...

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Correlate the Use of Causal Analysis in SAP APO with the Underlying Mathematical Model

Learn how to carry out causal analysis in SAP Advanced Planning and Optimization (SAP APO) when demand is correlated with some known and measureable factor (demand is a function of some variables). Understand how regression is used to find correlations between a single dependent variable (y) and one or more independent variables (x1, x2…xn) and…...

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Best Practices for Virtualizing SAP HANA

This part 3 of a 4 part series of presentations hosted by SAPinsider and sponsored by VMware, SAP, and Intel VMware Product Manager/Field Architect, David Gallant and VMware SAP Alliance Manager, Richard Lichenstein presented this live at the Simplify and Automate SAP HANA one-day forum. This presentation discussion provides how to achieve faster time-to-value, better…...

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Electronic Auditing is Coming to Mexico – Are You Prepared?

In a recent interview with CNN Expansion, Aristoteles Nunez, the head of Mexico’s Tax Administration Services (SAT), stated that the Mexican government will begin deploying electronic audits in the second half of 2016. This is a move the SAT has already been gearing up for over the past few years by moving much of its operations to the electronic sphere. For example, more than 5 million Tax IDs are exchanging standardized XML invoices, and in 2015 more than 5.7 billion XML invoices were exchanged. And with the advent of eAccounting standards, more than 1 million taxpayers are filing electronic accounting reports on a monthly basis, including Chart of Accounts, Trial Balances, and Journal Entries

 In other words, the Mexico SAT has been working to build up the automation tools, data, and digital reports needed to start performing audits electronically. 

Currently, the Mexico SAT is performing an average of 45,000 audits annually. During the summer of 2016, it plans to transition upwards of 4,000 of those audits to electronic means by comparing the data within eAccounting reports to the transaction data contained within the XML archives.  Once this process gets going, it’s likely to scale quickly. The number of audits based on electronic data will rise over the next 12 months and, in all likelihood, will eventually surpass the current number of physical audits. As the Mexican government continues down this digital path, they may even begin using big data to better audit taxpayers. This is the future reality that multinationals operating in the country must prepare for.

As custodians and end users of SAP financial applications, there are a few best practices you should be following now to prepare for the future of Mexican tax audits:

  1. Ensure you are not paying off the PDF version of the invoice.  During an audit, the only thing that matters is the XML invoice.
  2. Implement the Polizas (Journal Entry) report. Many companies only implemented the Chart of Accounts and Trial Balances, as Polizas were primarily focused on companies looking to get tax refunds. It is important to remember that the Journal Entry reports are most important during an audit.
  3. Turn to process automation for posting government approval codes to your accounting documents. Remember that a fully approved invoice is required to support your tax deductions.  If you receive an invoice for 100 pesos and send a credit note back to the supplier stating you will pay 90, you still have to remember to update the government XML.  The only way to ensure “straight through invoices” that will pass government audits is through accounts payable automation via SAP solutions.
  4. Implement validation reports so you are not guessing if your data will pass an audit. If you only use OSS notes to find errors, your financial controllers will have to manually review thousands of documents. You can instead implement automated validation reporting tools that will more effectively show a number of essential key metrics.

The Mexican government is utilizing standardization and automation to collect their revenue, and the electronic audit warning has been given. It’s now time to ask yourself how seriously you will heed this warning and to determine what solutions you will implement to defend your tax deductions in Mexico.

To learn more about the potential impact to your company, please contact us today. 

 

Steve Sprague is the Vice President of Product Strategy for Invoiceware International. He is responsible for both product management and e-Invoicing regulatory updates. Over the last 16 years, he has designed solutions for SAP ERP that deliver out-of-the-box compliance for Latin America and European Union e-invoicing and fiscal reporting requirements.