Electronic invoicing is the exchange of an electronic invoice document between a seller and a buyer. An electronic invoice (eInvoice) is an invoice that is issued, transmitted, and received in a structured data format that allows its automatic and electronic processing, as defined in Directive 2014/55/EU .
An electronic structured invoice contains supplier data in a machine-readable format that can be automatically imported into the buyer's accounts payable (AP) system without requiring manual entry.
When comparing electronic invoices with paper invoices, it is useful to emphasize that paper invoices have three characteristics so deeply integrated that we usually don't notice they can be separated. Paper invoices:
contain details of such data as amounts, descriptions, and quantities.
Provide that data in a visual format, on printed paper, that can be read by hand.
They have a physical form that allows them to be handled and exchanged by hand.
Digital images, PDFs, and other digital visual formats of invoices remove the physical element and allow invoices to be processed and archived more efficiently than paper. These formats, however, require the invoice to be viewed manually and its data to be read manually and entered into AP systems.
E-invoices contain only data in a structured form and can be automatically imported into AP systems. They do not include a visual presentation of the invoice data, although they can be temporarily displayed during processing or transposed into visual formats. For electronic invoices, the visual format is secondary, and the goal of automation is not to view the invoice, except in exceptional cases.
A human-readable, visualized version of the invoice can be created for reading purposes and may be included within the structured message, but it is not considered part of the invoice itself.
E-invoices are not:
Unstructured invoice data issued in PDF or Word formats.
Images of such invoices, such as JPG or TIFF.
Unstructured HTML invoices on a web page or in an email.
OCR (Scanned paper invoices).
Paper invoices sent as images via fax machines.
The use of electronic invoices requires two main functions:
The electronic invoice must be created with the proper structure.
The electronic invoice must be transferred from the seller's system to the buyer's system.
The European standard for electronic invoicing, European Standard for the design and construction of passenger ships, Defines the structure of an electronic invoice and various options for transmitting the invoice.
CEF electronic invoicing building block
The e-Invoicing Common Implementation Block aims to promote the adoption and accelerate the use of e-invoicing in accordance with the European standard among public and private entities established in the EU, as well as in the participating countries of of the EEA.
The CI eInvoicing building block supports public administrations in compliance with EU eInvoicing legislation and helps service and solution providers adapt their services accordingly. Therefore, the e-invoicing building block provides for Business-to-Government (B2G). However, e-invoicing can also be used to enable Government-to-Government (G2G) communication.
Business-to-Business (B2B) and Government-to-Citizen (G2C) or Business-to-Consumer (B2C) are not addressed within the framework of the electronic invoicing building block.
The technical management of DSI eInvoicing is carried out by the General Directorate of Informatics ( Digital ) of the European Commission. The implementation of the EU policy directly related to eInvoicing is the responsibility of the Directorate-General for the Internal Market, Industry, Entrepreneurship and SMEs ( DG GROW ) of the European Commission.
Source: Connecting Europe