Applying the Flow Extension API to Clearance Systems
In my previous blog posts, I introduced our Flow Extension API and then shared a quick guide to evaluate different ways of applying it. So, I think it could be very helpful to go deeper into details, through concrete applications to real problems. As Christopher Crawford wrote “knowledge without application is like a book that is never read.” Let´s apply it to tax invoices.
Tax invoicing is being adopted across the globe as a vehicle to combat tax evasion. The clearance model prevails in Asia and Latin America, but we’re seeing it increasingly in Europe as well. We understand clearance systems as legal in which an electronic invoice must be sent to the tax administration or its licensed/accredited agent for authorization prior to, during, or just after issuance, as an original tax invoice.
In response to these challenges, Ariba Network can further expand its invoicing capabilities through partners and extensibility tools like the API.
One of the applications of this API is the interruption of the invoicing flow for further validations after an online invoice is created on Ariba Network.
So, a third party or partner can pull the invoice data, as well as the attached legal file, through the Flow Extension API for legal validations, which are mandated by tax authorities, before being accepted into legal books. This way, the buyer can identify and reject a fiscally invalid invoice before it’s delivered.
If we apply the evaluation process stated in my previous blog post.
- The third-party provider performs the following tasks and API events:
- Get the new invoices submitted to the buyer (GetNextEvents)
- Acknowledge these documents (Acknowledge)
- Get each event data (GetEventData)
- Get the legal file attached to each invoice (GetAttachments)
- Run buyer legal validations over that file
- Post comments with validation results for further visibility (PostDocumentUpdate)
- Reject the document and stop delivery (Halt)
- OR resume the flow if valid invoice (Resume)
- This applies to invoice as the Ariba Network document type
- The use case, actions, and stage selected are the following:
Use case Actions Supported Document Stage Halt flow extension
· Get data
· Accept/reject your document
· Run validations
· Post comments
· Invoice Pre-propagation
- This process is applied to invoices that meet certain criteria:
- ISO Country code = PE (Peru), so that we restrict it to one single country
- Company address ID is “2026”
- Finally, our partner or service provider gets access to the Flow Extension API and calls the events listed above in (section 1, indicated by the italicized text in parenthesis.
The global trends clearly show that countries are increasingly adopting the clearance model , with harmonized digitalization of tax reporting and financial and physical supply chain. This requires further collaboration among all parties involved: suppliers, buyers, and tax authorities. Therefore, this tool may be helpful for expanding customer capabilities to process invoices, as well as other documents, like ship notices or goods receipts.
As we have seen, an adequate analysis, according to the proposed evaluation process, helps ensure better results and reduces the chances of unpleasant surprises during the implementation phase.