Rolling out UAE e-invoicing involves multiple moving parts. It works best with Finance and IT collaboration from the beginning. This blog explores why finance IT collaboration matters, where gaps often occur, and how these teams can work together to make e-Invoicing implementation smoother and more effective.
1. Why Finance and IT Collaboration Is Critical
In any e-Invoicing project:
- Finance owns responsibilities like tax compliance, master data accuracy, VAT treatment, and setting the business rules.
- IT manages ERP system integrations, workflow and compliance automation, API connectivity, data transformation, and security protocols.
When these teams work independently, misconfigurations and delays become common. For example, Finance may assume specific fields exist in the ERP, while IT realizes they are missing. If teams do not align on logic or expectations, the project risks running into compliance issues or requiring rework later on.
2. Common Gaps Seen in UAE e-Invoicing Projects
Here are a few recurring challenges in UAE e-Invoicing rollouts:
- Data readiness issues: Finance may assume the data required for e-Invoicing is already present in the ERP. IT then uncovers that key elements like TRNs, tax codes, or line-level details are incomplete or missing.
- VAT logic not mapped correctly: Finance defines the VAT treatment, but if those rules are not clearly translated into the system’s integration logic, invoices can end up with incorrect tax outcomes.
- Limited awareness of Peppol-specific requirements: IT teams may not be fully aware of the PINT-AE schema or how the different corner roles (like C2 or C3) function, which leads to incorrect message formatting, validation, or data transfer errors.
- Master data duplication: Without clear ownership for maintaining customer and supplier master data, issues like duplicate entries or invalid TRNs are common. This directly impacts invoice validity.
- Mismatch between compliance and output: While Finance teams focus on accurate VAT reconciliation and compliance, IT teams may be primarily concerned with generating and submitting valid XML files. This disconnect can lead to gaps in reporting or audit readiness.
3. UAE’s 5-Corner Peppol Model Adds Complexity
The UAE is adopting the 5-corner Peppol model, which includes multiple parties: the buyer, the seller, their respective service providers, and the Federal Tax Authority (FTA).
This structure adds a layer of complexity, requiring:
- Real-time validation and delivery: Since invoices are validated in real time before reaching the FTA, both Finance and IT must ensure data and system accuracy and timely submission.
- Clear coordination across parties: Each role in the 5-corner model has specific responsibilities. Both business and technical teams must understand these to avoid confusion during integration.
- Error interpretation from different angles: IT might read technical logs and error codes, while Finance needs to interpret whether an invoice was accepted, rejected, or needs correction. Both perspectives are required to resolve issues quickly.
4. Key Areas Where Alignment Is Needed
Finance and IT alignment doesn’t happen by chance. It requires intentional planning in key areas:
- Data ownership clarity: Every invoice field, from tax codes to supplier addresses and TRNs, must have a defined owner. This avoids guesswork and speeds up troubleshooting.
- Shared glossary and definitions: A Common understanding of terms like UBL, UUID, and Peppol IDs avoids miscommunication and ensures smoother project delivery.
- Exception handling built into the integration: Business rules defined by Finance should be implemented clearly by IT in the integration layer, especially for scenarios like credit notes or tax-exempt transactions.
- Joint user acceptance testing (UAT): Testing should involve real scenarios like partial deliveries, waybills, and invoice corrections. Both teams should review outcomes and sign off together.
- Unified dashboards and logs: A shared audit trail showing both technical status (like submission logs) and business status (like VAT summary) helps both teams stay on the same page.
5. Best Practices to Bridge the Finance and IT Divide
Here are practical ways to ensure smooth collaboration:
- Involve both teams from the start: During requirement gathering, make sure both Finance SMEs and IT architects are part of every workshop.
- Visualize data flows: Use process diagrams or invoice journey maps to help both teams understand how data moves from ERP to the FTA.
- Adopt agile governance: Create project sprints with clear ownership. Finance defines the rule logic, and IT translates it into system behavior. Regular reviews ensure both teams stay aligned.
- Use middleware that simplifies complexity: A good middleware platform abstracts technical formatting while still giving Finance the visibility they need.
- Cross-train both teams: Help IT understand VAT rules and reporting requirements. Help Finance learn the basics of XML structures and schema validation. This builds empathy and clarity.
6. Lessons from Real Projects in the UAE
From projects we’ve supported across industries like aviation, logistics, and retail, a few things stand out:
- Alignment prevents rework: In one aviation project, involving both Finance and IT from the early data mapping stage, it helped prevent over 40 percent of downstream corrections.
- Strong master data governance pays off: When customer and supplier records had clear ownership, issues like duplicate TRNs or missing addresses were significantly reduced.
- Shared error dashboards accelerate resolution: One logistics company implemented a single view for error logs and VAT impact. This helped both teams identify root causes faster and take corrective action without finger-pointing.
Cygnet has worked closely with many organizations in the UAE to streamline their e-Invoicing readiness. Whether it’s defining invoice workflows or cleaning up master data, we’ve seen firsthand the difference cross-functional collaboration makes.
Final Thoughts
Finance and IT must work as partners, not separate entities, in e-Invoicing projects. UAE’s compliance model demands real-time accuracy, tight integrations, and clear ownership of both business and technical elements.
When both teams speak the same language, take joint responsibility, and plan testing and governance together, the outcome is not just a successful go-live but also a future-ready invoicing setup that’s easy to scale and maintain.
E-Invoicing success in the UAE isn’t just about technology or compliance. It’s about collaboration.
Author
Komal Vithalani
Content Writer
Komal Vithalani, a Chartered Accountant and Commerce graduate, is a dedicated professional committed to delivering value with years of expertise in navigating the complexities of indirect tax laws. Her practical excellence includes managing perplexed litigations, dispensing tactical tax advice, conducting thorough compliance checks, supervising audits, and crafting articulate and insightful content. At Cygnet, Komal seamlessly blends her profound understanding of tax regulations with cutting-edge tax technology. Leveraging her competence, she adeptly transforms complex tax tech jargon into concise, impactful, and engaging content. This not only aids readers in comprehending tax-related topics with enlightening clarity but also ensures the delivery of narratives that resonate broadly.
