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When Mexico announced e-accounting legislation, many multinational corporations argued that the requirements were unconstitutional. Almost 10 percent (16,000) of the companies initially required to file their records electronically in 2015 were granted a legal stay, called an amparo. However, as 2016 approaches, these stays are quickly running out. To date, courts have shown a tendency to deny continued amparo and ruling on the side of Mexico’s tax authority, the SAT, to require electronic reporting.

Time is of the essence – when amparo expires or courts rule in favor of the SAT, companies areimmediately responsible for generating and submitted required reports retroactively - which is why they must have a solution in place before that happens. As you prepare for this inevitable requirement, here are some key considerations:

Compliance is not simply a technical issue.

Internal processes are critical to compliance. How and where is your data input? How is that data then connected to the correct internal and external reports? Companies who maintain separate systems for e-invoicing and accounting risk errors, which trigger audits. All compliance should be maintained within your ERP, and journal entries and reports should all link back to the original XML for seamless reporting and compliance.

Unique codes are required for each transaction.

eContabilidad reports encompass your chart of accounts, trial balances and journal entries, which all must link to XML e-invoicing approval codes known as UUID. These 36-digit, case sensitive, alphanumeric codes are typo magnets, making manual data entry an insufficient (and inefficient) means of compliance.

Change is constant.

As we’ve seen with e-invoicing in Mexico, the mandates change frequently, requiring significant change management or a proactive solution to keep your compliance efforts up to date.

Opportunities are inherent in these challenges.

Despite eContabilidad’s complexities, these requirements can actually help companies streamline their accounting process. By automating reports, staff can focus on discrepancies and errors instead of data entry. Plus, by linking all transactions, companies will have complete and accurate financial records.

Another key consideration: even if your company remains under amparo for the time being, the reports required under eContabilidad are still necessary if your company is being audited or is claiming VAT tax credits – they are just submitted physically instead of electronically.

Don’t wait to begin updating your internal accounting processes and implementing a proactive e-accounting solution until your reports become overdue.

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