What is it that a smart CFO would want when it comes to managing GST compliances? It would be everything that saves him money, time and resources while managing them. The three most precious things that need intelligent management.
GST compliances which are now a way of life and need to be managed almost daily for any big corporation, need to be simplified and made hassle-free. Automation can be the key here and here are a few reasons why.
Save Cost and Time
Managing the GST documentation and compliance requirements using manual methods sure seems to be the easier way out. However, what we fail to observe is that this will require time and with GST return filing being a monthly process, companies cannot afford to invest too much time in these compliance affairs. The time required to complete these compliance requirements can rather be utilized to make important business decisions.
Appropriate tax technology solutions can come to your rescue here by automating processes like invoice preparation, validation, error identification and backward integration with the ERP systems to make sure that errors are rectified. This will lead not only to saving of time but also costs in the long run since man-hours required for completing a task will reduce drastically.
A renowned private bank in India shifted to an automated GST return filing solution that automated the process of creating JSON files for filing GST returns for 120 GSTINs throughout India and also to reconcile the records with vendor records. The shift to automation led to saving of almost 300-350 man-days which translated into 7 man-days of work for them each month and hence the work efficiency went up.
Similarly, when another bank shifted to auto-generation and signing of invoices over 1 lakh in a month, it saved almost 208 man-days in each month considering that attaching a DSC to a single invoice may take approximately a minute. Considering you employ some 20 persons for this task, they may require 10-12 hours each month to only sign these invoices. This is a ridiculously large amount of time for the signing of invoices.
Improve efficiency and reduce errors
Efficiency can drastically reduce when the manual processing of data leads to errors. The manual processing of huge data that is generated at the invoice level can easily lead to human errors and this might ultimately lead to the erroneous filing of GST returns, resulting in penalties and even wrong ITC claims being filed. This is a very heavy cost that you may have failed to assess. Resolving mismatches in the GST invoices is another area that needs attention since ITC claims are entirely dependent on this.
Automating the entire process of GST invoice preparation, validation and filing returns is a preferred option even if the cost in the short run may escalate slightly. A tax technology solution that can automate the various GST compliances can save on cost as well as time in the longer run.
When the same bank mentioned above, that used automation systems to create JSON files, also used automation for reconciliation process and error identification, they could locate and access error records via a dashboard, have access to vendor-wise error records that were system generated and also reconcile the records count for all available GSTINs.
One of the biggest retail chain needed to make sure that the millions of items they sell and purchase must be entered accurately in the invoices that are generated. Automation came to their rescue when they opted for an end to end GSP solution that automated invoice generation and made sure that all the line items in a single invoice with different GST rates are entered accurately. This reduced errors and increased efficiency of the task.
Reap long term benefits
The entire corporate world along with the governments around the world are moving online and digitizing the reporting processes and it makes a lot of sense for corporations also to move to digital record keeping. This is clearly the future of government tax compliances and if we prepare the records digitally to start with, it is way easier to file returns, report your records to the government and reduce chances of errors.
Automation of the GST compliances end to end is necessary to make sure that all the processes come on the digital platform and the entire process from data extraction to record processing and finally return filing on the GST portal.
A leading consumer goods company who shifted to the automation of their E-way Bill management systems achieved improved communication with the stakeholders, a streamlined request and response mechanism with vendors and government alike which made the entire procedure very future centric due to digitization.
Similarly when a retail giant in India who had 30,000 plus vendors needed to reconcile records with them, shifted to an automated solution it successfully put validations in the SAP ERP systems to reduce errors which also helped identify error records so that these could be corrected.
Hence automation can surely free you from the GST worries by handling the tasks efficiently and in a timely manner.