Here is a quick summary of the Brazil Nota Fiscal issues since 2012. Are you able to comply with all of these. Many large companies are using these changes, including the inbound events, to re-evaluate their solutions and production support issues.
January: Expanded Validations (e.g. Footer = sum of line items, stricter normalization codes, etc.)
March: Paper correction notes no longer valid, replaced by CCe
April: Inbound Validation & Reporting: inbound NFE & CTE must be validated and supplier approval numbers stored in system of record for monthly SPED reports.
August: Event based web services online in production, mandates to come.
January: ICMS Tax Rate Lowered – Impact to ERP and NFE validation
January – March: Manifesto de Documentos Electronico (MDF-e). Needed if company manages their own logistics. Documents all of the NFE per truck. Not needed if CT-e provided by 3rd party logistics provider. Being phased in by transport method (e.g. Rail, Air, Road, Water).
March: Paper correction notes no longer valid, replaced by CCe
March: Eventos based Cancellation.
New web service replaces old web service becomes mandatory in March, 2013.
Makes reference to the original NFE.
If you have not upgraded your SAP GRC system for Nota Fiscal, you must must upgrade to 10.0 or select alternative.
March-July (Oil/Gas): Manifestacao do Destinatario.
Mandate currently on receiver only.
Receiver must acknowledge receipt of goods with reference to NFE upon arrival, thus preventing supplier from re-using that number for a separate, unregistered shipment. (No cancellations or corrections allowed by supplier after acknowledgement).
Acknowledgement triggers access for receiver to download the supplier’s NFE-XML from the SEFAZ web site directly – email collection mechanisms no longer necessary.
It is expected that this mandate will roll-out to other industries over the next months and years.
When we talk to companies about implementing Brazil Nota Fiscal inside of their SAP process and systems, the most overlooked party that should be involved in the discussions is the logistics/shipping managers. It is important to remember that the Brazil eInvoicing process affects more than just IT or finance; the process affects logistics in two ways:
Outbound Shipping -- It is important to remember that you CAN NOT release your truck from the loading dock until you have a valid DANFe printed out and placed on the truck. This makes the process mission critical and should not be taken lightly when evaluated. We see many companies just looking for the cheapest signing solutions; however, this process in Brazil is so much more than signing. Overlooking the concepts of contingency, monitoring, and printing management could be costly. And I mean, extremely costly. What is the cost of a lost customer, let alone, the financial penalties to release a truck that has been impounded.
Inbound Receiving -- most supply chain experts look at the cost of the operating components in their value chain. Inbound receiving can be upwards of 10% of the operating costs of a warehouse, so many companies are seeking to reduce costs where ever they can. Squeezing efficiency out of each moving part in the process equates to better margins and competitive positioning. We are seeing leading companies reduce their inbound receiving costs by upwards of 70% through the use of Inbound Nota Fiscal processes. The Brazil process has some unique benefits:
Your supplier must validate their invoice prior to the truck leaving their warehouse
This means that what is on the invoice is also going to be on the truck
Additionally, the supplier must make their approved NFe available to you if you request it.
This supplier invoice can arrive before the truck. All you have to do is request the invoice be emailed at the time of shipping.
By having the validated XML before hand, you can then pre-process many of the approval steps (i.e. match it to a PO or receive workflow approval on an FI invoice)
When the goods arrive, the warehouse can inspect the goods and with one scan of the barcode on the DANFe, have all of the information on the corresponding print out uploaded to the ERP system
This eliminates -- time, manual data entry, manual comparison of goods to orders and ensures your warehouse is running efficiently.
You can also pre-validate freight payables with the combination of the CTe (transportation invoice that is mandated by the gov't).
I encourage you to take the time to look beyond compliance, the return on investment from Nota Fiscal can be huge if you go beyond the mandates and review how the process can be utilized to your benefit.
Brazil continues to add and update their Nota Fiscal legislation. Today, I wanted to discuss the importance of Transportation Invoices, as these will be mandated starting in September 2012. The Transporation Invoice, also known as the Conhecimento de Transporte (CT-e for short) was added to the legislation as a mandatory electronic document based on the 169th meeting of the Conselho Nacional de Política Fazendária – CONFAZ held on December 11, 2011. Below, I summarize some of the common questions we are hearing from clients and SAP end users.
Key Take Away - ensure your solutions have the ability to validate the CT-e and work with your freight forwarding and 3PL partners to understand the timeframes that they will transition to the CT-e.
What is the CT-e:
Brazil Transportation Document – is issued and stored electronically in order to document the provision of transport services, whose legal validity is guaranteed by the issuer’s digital signature and authorization of use provided by the tax administration. Examples of use would be a Waybill (model 10) or an Invoice for Transportation Service (model 7 when transporting cargo).
What are the dates for compliance?
September 1, 2012 is the initial deadline with others following in December 2012. There are waves of compliance defined by the government which are listed in the link to the general announcement.
www.fazenda.gov.br/confaz/confaz/ajustes... is a link (in Portuguese) to the overview. Your web browser should be able to give you a basic translation of the material. This announcement also lists further timelines as well as a list of transportation organizations that are specifically called out in Annex One for compliance.
Are there benefits to our organization that we should consider along with the mandate?
There are definitely benefits to an SAP user, beyond just becoming compliant. For example, we are seeing companies tackle the CT-e early and capitalize on the business processes which are accelerated due to the electronic requirement.
Lower Freight Costs: Track your spending on transportation invoices for discrepancies and eliminate duplicate invoices and payments. You can automatically match the electronic invoice against Transportation Management Systems or blanket PO.
Less Labor, Faster Processing: Automatic reconciliation of inbound NF-e for acknowledged and pre-approved payment processing.
Stay tuned for further SAP Brazil Nota Fiscal and SAP e-Invoicing Compliance posts as the legislation continues to change.