Technical Adaptation and Process Implementation for Electronic Document Interchange in Russia
By Alexey Kozlov
In Russia, like everywhere, there is legislation regarding the maintenance of accounting documents. Usually it requires tedious work which takes a lot time for the preparation, signing and posting of such documents.
For example if Company A sells goods or services to Company B, an accountant from Company A should do the following steps:
- Enter the sales invoice into the accounting or ERP system of company A;
- Print a form TORG-12 for goods or an Acceptance act for services (2 copies);
- Print the VAT-Invoice;
- Have them signed by a responsible person and stamped;
- Send the paper documents to Company B using a courier.
An accountant from Company B should do the following:
- Have the documents signed by responsible person and stamp TORG-12 or Acceptance act;
- Send one copy of TORG-12 or Acceptance act to Company A;
- Enter the information about the incoming invoice and VAT-Invoice into the accounting or ERP System of Company B.
But now in Russia it is possible to use electronic invoicing and in case the companies meet the required rules and procedures, they don’t need to use paper documents any more.
Unfortunately, companies can’t just send electronic documents via e-mail, FTP server or on a flash drive. Rather, the process a bit more sophisticated and rightfully so to ensure integrity and safety. It is necessary to use an authorized operator which has the legal rights, knowledge and experience for this kind of service.
There are many authorized operators on the Russian market and the latest information can be easily found on the Russian Tax Service’s official site.
The other requirement is that the data file containing electronic documents should be signed using an electronic signature and this signature must be legally recognized and accepted everywhere. When companies conclude a contract with their operator, they will receive a certificate for their electronic signature. Where there are many responsible signers in a company, each one should have their own certificate which is linked to the identity of each person.
In order to exchange electronic documents not only between the companies but to also send them to the Tax Authorities during the tax audit procedure as well, the files should be saved in the legally defined formats. There are two main document formats:
- Order of Federal Tax Service of Russia as of 21.03.2012 № ММВ-7-6-172@ (about TORG-12 and Acceptance Act file formats)
- Order of Federal Tax Service of Russia 05.03.2012 № ММВ-7-6/138@ (about VAT Invoices, Ledgers of received and issued VATinvoices, Purchase and Sales Ledgers)
In order to implement EDI with clients and suppliers, the company should do the following tasks:
- Conclude a contract with an operator and get the certificates for the electronic signatures.
- Implement the software and hardware requirements (integration with their ERP).
- Train the staff.
- Involve customers and suppliers into EDI.
Many operators provide a web-based service for EDI which is similar to internet banking where one can enter invoice information directly into special forms or upload a data exchange file, signed by an electronic signature and sent to your contractor.
The other way is integration with an ERP or accounting system like 1C, Microsoft Dynamics NAV, SAP, Oracle, etc. In this case, all operations like creation, approval, signing and sending can be done directly in the ERP/accounting system.
There is a very good and suitable solution for SMEs from 1C and Taxcom which is called 1C-Taxcom:
- The module for EDI is already integrated and included into many 1C systems (Accounting, ERP, Complex Automation).
- Easy to create and sign documents directly in 1C system.
- Incoming electronic documents automatically generate account bookings in 1C.
An accountant from the Seller company creates a document in 1C, signs and sends it to the operator, Taxcom. The operator performs an automatic check on the validity and signature of the electronic document and sends it to the Buyer company as well as a confirmation about the document receipt to the Seller company. When the accountant from the Buyer company receives the electronic document he/she sends the confirmation to the operator and the operator forwards it to the Seller company.
Based on the uploaded electronic documents into 1C, the accountant of the Buyer company can create incoming documents or VAT invoice in 1C. While the process may seem confusing at first, once done a few times, it will become noticeably easier and after a year, you may be wondering why EDI was not implemented sooner.
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