Images ensure GST compliance
Images ensure GST compliance
Scanned documents help Telstra achieve GST compliance
An extra $4 billion is expected to be added to the government coffers from a crack down on Goods and Service Tax compliance by the Australian Tax Office. In November, the government department said it will crackdown on noncompliance, issuing heavy fines to companies which fail to act in accordance with the new tax regulations.
In order to avoid these fines, national telecommunications provider Telstra installed a document imaging and management application.
”In recent times the ATO are getting harder and they are looking for a level of compliance,” said Neal Rolf, regional manager for corporate wide shared services at Telstra. While responsible for accounts payable at Telstra, Mr Rolf has to ensure that the incumbent operator is GST compliant.
”When GST was introduced it added another level of complication and it is pretty important to identify the GST on each invoice,” he said of the new workload. “The issue for us was how accurate was the original data?”
To achieve the required level of accuracy, Telstra set up a single accounts payable division in Brisbane and selected an imaging and document management system to control the process. To ensure strict compliance a Telstra office in Melbourne takes samples of the data produced by the accounts payable division.
Back in the mid 1980s Telstra had accounts payable departments across the country and often struggled to find important documents because of the different types of archive selected by each office.
”We started looking at new imaging technology for all the documents in 1998 and got in touch with IXOS as the existing technology was not Y2K compliant,” said Mr Rolf. Unisys had installed state of the art document imaging technology at a number of Telstra sites in the mid 1980s. Mr Rolf explained that to avoid documents going missing it was decided that a single process was needed.
”It is very difficult getting all the different sites to do things in the same way. We reaped a lot of benefits from having one site, we now have a training module and a consistent process,” he said.
A leased deal was negotiated with IXOS for its eCONtext document management system. IXOS was selected as the German software integrates with SAP’s R3/460 application, which Telstra use. SAP owns a portion of IXOS.
”Every morning the documents are scanned and boxed straight away and from that point workers use only the images. Whatever we receive today, we process today; there is never a backlog of work. We have only had to reference the original documents once or twice, and that was for a customer in Kazakhstan,” Mr Rolf said. The Tiff images contain documents dating back to 1995.
When John Howard’s government introduced the GST tax in June 2000 the business community had to comply with complex regulations for claiming and paying the new tax; but Telstra found the introduction of the new tax to be simple.
”It was a by-product of what we had just done, it was not a difficult thing to do,” Mr Rolf said.
In preparation for the new tax Telstra carried out a dress-rehearsal audit with the help of its own people in Melbourne and an accountancy house.
”They [the Melbourne office] do a sample with the document number and they can view the documents on the screen in seconds with no need for paper to be sent down,” he said. “When there is an audit we sit the auditors down at a PC and off they go. Most auditors are in their 20s and are very tech savvy and don’t like paper, so they tend to warm to the system,” said Mr Rolf.
”With corporate governance, your management team is concerned about an audit, they don’t want a bad audit and that is one of the real benefits of a proper document management system,” said Tom Hughes, the regional manager for IXOS in Australia. The IXOS system has also allowed Telstra to completely ignore physical barriers. Whereas the old Newcastle accounts payable department stored documents in a wine cellar, all the scanned images are kept on CD jukeboxes in Melbourne, despite the documents being imaged in Brisbane.
”We have never had a lost invoice since we went onto this system and it has reduced the retrieval costs. The biggest cost saving is not tying people up with retrieving archives,” Mr Rolf said.
Mr Hughes added, “This is a really good example of how you can use document management technology in an accounts payable scenario.”