Originally posted on Indirect Tax Technology:
For nearly every company, the accuracy and efficiency of local-country VAT compliance is nearly completely dependent on the functionality of the underlying ERP system.
Operational malfunctions in a system that is used to manage VAT compliance can lead to substantial financial risks.
There are countless examples of the mismatching of VAT treatment of purchases and sales in chain transactions, double payments of VAT and “forgotten” manual adjustments to the VAT filing, all attributable to shortcomings in SAP’s automated VAT solution.
Errors in the basic VAT configuration of ERP systems can also carry consequences for an organization.
Without the proper VAT rules, many systems are incapable of processing transaction information correctly, so that transactions may become blocked.
This has a great impact on logistics processes, invoicing processes and financial processes.
Tax and financial departments are under increasing pressure to reduce the costs of compliance processes. One result of this is the…
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