Learn How Tradeshift & Invoiceware International Deliver Fully Compliant E-Invoicing Solution to Latin America

1. Latin America E-Invoicing
Global Platform. Local Compliance.

2. Today’s Agenda
Steve Sprague
VP, Marketing & Product Strategy
Invoiceware
Presented by:
Catherine Liao
Head of Presales
1. Tradeshift Introduction
2. e-Invoicing in Latin America
3. Achieve 100% compliance in
LATAM with Tradeshift

3. Tradeshift Business Cloud
A cloud-based platform enabling business
interactions including e-Invoicing, workflow,
payments, vendor management and more.
196
Countries
5mil.+
Businesses
15mil.
Invoices
$200bn
Spend

4. E-Invoicing with Tradeshift
• There are no barriers to join, all
companies can sign up and start
sending e-invoices for free.
• Buyers and sellers can interact
and collaborate in real-time
• A rapidly growing eco-system of
applications supporting enterprise
invoice presentment and payment
(EIPP) processes.
• Companies can extend business
processes onto Tradeshift by
installing or building their own
apps.

5. E-Invoicing Challenges for Multinationals
Domestic e-invoice &
Cross Border
 Domestic Invoices subject to electronic mandates
 Cross-Border – still predominately paper
VAT
Tax Remittance
 Supplier VAT deductible only from gov’t valid invoices
 Coordination of Credit/Debit notes to adjust gov’t
registered taxes once goods accepted
 PO usage on the rise but still low
 E-invoice formats don’t support “Straight Through
Processing” – need ability to append data
PO Usage
“STP” Capability
Supplier
Collaboration
 Master Data & Onboarding Requirements
 Payment Status, PO Append, Dispute Management,
Supply Chain Finance
 Different e-Invoicing provider in each country
 Complex legislation equals high internal support costs
Multiple Local Vendors
Cross Border

6. E-Invoicing in Latin America

7. Differences to other Regions of the World
Different Types of Countries
• Mandated electronic invoicing: Brazil, Mexico,
Argentina
• Expanding Countries: Chile, Guatemala, Uruguay,
Costa Rica, Colombia
Domestic versus Cross Border
• Domestic equals VAT tax and is subject to country
mandates
• Cross Border is predominately paper
Mandates Constantly Evolve
• Can change 3-4 times per year as the tax regulations
evolve
• Average multinational spends 2600 hours a year
managing Brazil issues versus an avg. of 80 hours a
year in other countries

8. Government in LATAM
• Mandates the use of electronic invoices
• Mandates that supplier must make e-Invoice available to Buyer
• Mandates the Format of the Invoice
• Requirement of Supplier Invoice: Approved and Accompany the Truck
• Increases accuracy of what was ordered, shipped and invoiced
• Invoice can arrive even before the Goods
Paper Invoices Supplier Rollout Multiple Formats Accuracy Timing
X X X X X
Gov’t Mandates for e-Invoicing
Eliminate Common Roadblocks

9. Real-Time E-Invoicing
Baseline Compliance Process Sets the Stage for Straight Through Processing
Brazil Real-Time Compliance Mandates
• Real time integration with Brazilian Tax Authority (SEFAZ)
• For Accounts Payable – Goods Nota Fiscal, Service Invoices at City Level & CTe -
Transporation
• NF-e received electronically by recipient in advance. Must be validated and any returns
accounted for via “return order process”
• SEFAZ does not validate your taxes in real time but they do data-mine to check later
• Brazilian companies are responsible for accurate taxes of their suppliers as well
Paper
Electronic
Inbound A/P
• Paper not authoritative for
compliance
• Suppliers must provide XML
electronically
• Step 6 (required) sets up
opportunity for automated
matching & “straight-though”
processing.
5

10. E-Invoicing in Mexico
Compliance Update
December 31, 2013
– CFD is Repealed
– There is NO “Grandfather” clause – everyone
must switch
• Includes all current CFD Users
• CBB (paper) allowed only for companies >
$250K Peso (~20K US Dollars)

11. Mandated Inbound Validation
Mexico Moves to CFDI
Mexico SAT - Real-Time Compliance Mandates
• Real time integration – legacy was a batch process
• Invoices must be registered and approved before being sent
• Printed CFDI is also a valid, legal invoice, XML must be archived for 5 Years
• CFDI may be received electronically in advance. Must be validated as authentic before
payment.
• Each outbound e-Invoicing solution must also provide for inbound validation as well
• IMPORTANT: Step 6 – You do not want to pay invalid invoices – Audit Risk & You Assume Tax
Issue

12. SEFAZ Solution – Two Way Process Orchestration via NFE “events”
• NFE is acknowledged by the receiving CNPJ through event posted back to SEFAZ.
• NFE must be acknowledged within 180 days initially, and eventually before shipment as
phased roll-out progresses.
• Greater burden on receiving CNPJ, but many large receiving CNPJ are pushing for these
changes to guard against ghost transactions in the first place.
• Solution very similar to EMCS for Alcohol/Tobacco/Energy within Europe
Draft, subject to change
Bi-Directional Process Orchestration with
SEFAZ as the Mediator Between Parties

13. 100% LATAM compliance
with Tradeshift

14. Considerations for E-Invoicing
Compliance
• Avoid ~$250 fine per invalid invoice
• e-Invoice received must match the e-Invoice previously registered
with the Tax Authority.
• Valid invoice = Okay to Deduct VAT on remittances to Government.
AP Efficiency
• If PO backed, does invoice = PO = Goods Receipt?
• If not PO backed, does commodity manager or buyer approve?
• Have the Goods Arrived and been processed?
Finance
Optimization
• Inability to optimize cash flow (e.g., Missed Discounts)
• Liquidity concerns for supplier operations
• Short-term investment of cash

15.  A single process to address
Fiscal Compliance (OK-to-Deduct)
and
Commercial Compliance (OK-to-Pay)
 Local language phone support
 Flexible supplier connectivity options
 Highest supplier value proposition
 No supplier fees!
LATAM Compliance App
(powered by Invoiceware)

16. How Does It Work?
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18. 100% Compliance in LATAM
Guarantee Compliance
– Full AP and AR invoice validations
– Immediate upgrades to accommodate any changes in mandated
regulations
– Ensure fiscal and commercial compliance
Streamline Business Processes
– Eliminate configuration issues
– Cut high cost of localizing & configuring ERP installation
– Support in a local language
Remove Risks
– Eliminate the risk of audits, stiff penalties and potential criminal charges
– Avoid receiving and posting invalid invoices
– Guarantee your ability to ship, collect money, and legally file local taxes

19. Let Tradeshift assist with your
LATAM E-Invoicing rollouts.

20. Q&A