Countries all over the world are constantly coming up with new methods to fight TAX fraud. Otherwise, it costs billions of dollars lost in tax revenue on an annual basis. One such method that continues to be quite popular is invoice-matching (in spite of many IMF, WB, and other assessment showing it’s not cost-effective).
This is a step many countries have decided to make – Taiwan, South Korea, and now India. So, how exactly does invoice matching work?
Explaining Invoice Matching
Invoice matching is “the process of comparing information on the invoice with supporting documents such as a purchase order, goods receipt, and contract.” The point of invoice matching is to detect any potentially fraudulent or irregular invoices. Once the purchase requisition has been approved within the organization, the purchase order can be generated and then sent to the vendor.
Of course, an invoice deviation can happen sometimes. This is also called invoice exception, and it appears when the data on the invoice doesn’t match the supporting documents. A deviation usually leads to a traditional and thorough investigation which should determine if it was acceptable or if there was an error.
How Does TaxCore Do It?
Invoice matching seems to be an outdated, labor-intensive, cost-inefficient method due to the way it deals with possible deviations. Traditionally auditing any irregularities is a waste of time and workforce in most cases, especially given the advances in technology. But it’s not just any application of technology that works, as the IMF indicates, just bringing in more computers to make processes go faster is not the answer. A new tech-based invoice is needed, and TaxCore is a proven new tech-based invoice system
Countries that implemented TaxCore can testify that their B2B invoices not only match, but they are completely identical. When an audit is needed, buyer or seller only need to confirm that they are using the correct or identical invoice already stored in TaxCore itself. As opposed to traditional labor-intensive or computer-intensive invoice matching, our platform allows for an instant audit because it is based on real-time data collection.
In Samoa and Fiji, TaxCore has fully revolutionized the way B2B transactions work, as well as the regular B2C transactions. To find out more about TaxCore features, get in touch with us here.