There is a small storm of activity coming in the next 18 months. And even though it is hurricane season, I am not speaking about rain and wind. I am speaking about the transition from CFD to CFDI for Mexico eInvoicing compliance.
Many companies are coming up on their deadlines for CFDI in December of 2012 and early Q1 of 2013. However, many companies are waiting too long to address the project needs. This will be a costly mistake and a potential audit risk to the controllers responsible for the books in Mexico. Remember, Mexico's SAT considers non-compliance with the laws a criminal offense: punishable by both fines and JAIL TIME.
The issue that most companies don't understand is that there will be many companies that have to transition to CFDI, not just them. The industry estimates that less than 10% of invoices have been transitioned to CFDI. This leaves over 90% of the volume needing to transition in the future. Here are a few things to remember as you start to rush your evaluation:
- A PAC is not enough. PAC's are authorized to sign on behalf of the government. However, for an SAP user, it is only 15% of the workload. The changes in the real time processes require quite a bit of SAP configuration.
- Don't wait -- you could be out of compliance and this carries fines and jail time
- The CFDI process is a real-time process for outbound factura. Meaning much like Brazil, the invoice must be approved prior to shipping your goods.
- YES, Inbound Validation is mandatory. The SAT states very clearly for CFDI that if you are deducting your taxes (i.e. pay
ing your taxes on the net and subtracting the taxes you pay your suppliers from what you charge your customers) then you must validate the inbound invoice.
Proctrastination and goverment mandates do not mix. Ensure you understand your migration time lines with your finance teams, as well as, engaging your IT experts to put together a project plan and SAP evaluation ASAP.