Germany’s ZUGFeRD electronic invoicing (eInvoicing) standard is making ground across Europe.
According to news from IDM on Friday (Oct. 20), the standard, which stands for “Central User Guide for Electronic Invoicing in Germany,” is more easily ready by Electronic Data Interchange (EDI) to transmit data from an invoice into existing enterprise resource planning (ERP) and accounting systems, as compared to other formats of “electronic” invoices like PDFs.
The ZUGFeRD standard enables smaller companies to more easily gain the benefits of EDI, which can be cumbersome to implement, because, as the publication explained, it requires an agreement between two companies to identify what data will be shared and how it will be structured. Plus, reports noted, companies have to purchase and implement additional software to process the invoices. For smaller businesses that process lower volumes of invoicing, EDI is not always worth the investment.
But using the ZUGFeRD standard, PDF invoices are imbedded with an XML file with data more easily extractable.
The Germany standard could be helpful to the whole of the European Union (EU) as upcoming requirements, which come into effect in November of next year, force EU member states to adopt eInvoicing between government entities and their suppliers.
Europe isn’t the only market pushing for an eInvoicing standard, either.
Policymakers in Australia earlier this year pushed for standardization across both the private and public sector. The Australian Taxation Office lent its support for the initiative, which included the formation of the Digital Business Council, created to establish a national framework for eInvoice standardization. Analysts say government entities that adopt the standards could realize savings of up to $3 billion a year.