Real-Time Audits in Mexico: Key Finance and IT Considerations

Steve Sprague
July 13, 2016

With the success of Mexico’s CFDI e-invoicing mandate, the country is once again setting a new standard for global tax compliance as it implemenst real-time electronic audits in September 2016. Mexico’s tax authority will now be able to immediately identify errors or discrepancies in tax liability calculations, and conduct immediate, automated audits as a result of its inevitable extension of e-invoicing and e-reporting initiatives.

Mexico is expected to move just under 10% of its audits to this automated process this year, with the end goal of conducting all audits in this manner. This means that companies doing business in Mexico need to be more focused than ever on eliminating errors in their e-invoicing, accounts payable and financial reporting processes. Penalties for errors and discrepancies range from hefty fines to operational shut downs – directly impacting business performance.

The risks of these electronic audits impact multiple business functions, from shipping and logistics to HR, but none more so than finance and IT. Check out our latest downloads series for tips on Mexico:

Finance Challenges: How to Prepare for an Electronic Audit in Mexico

IT Challenges: How to Implement Financial Reporting in Mexico

Here’s a peek:

Key considerations for finance: 

  • Several key audit trigger points should be a primary focus, including sales, purchases, travel and expenses, and payroll.
  • Audit defense also needs to be a priority. Companies should automate processes and ensure that all transactions and financial reports are properly linked to protect and defend against an audit.
  • All data must be validated – it’s not enough to simply meet the government’s standardized formats; the data must be 100% accurate.
  • Don’t rely on amparo. Amparo is not a lifetime protection for the companies that were granted legal stays in electronic accounting filings.

Key considerations for IT:

  • IT teams provide the key to reducing error risk, protecting against audits and providing critical validations, making their role critical to compliance.
  • Regulatory compliance must be managed within a company’s ERP to eliminate potential holes and the risk of manipulation, yet significant global template customizations are necessary to meet local legislative requirements.
  • SAP and corresponding OSS notes alone don’t protect against real-time audits.
  • Eliminating manual work must be a priority, as manual data entry and verifications are error prone and therefore key audit triggers.

To learn more about protecting against Mexico’s electronic audits, download our tip sheets for Finance and IT roles.  



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Steve Sprague

Como director comercial, Steve Sprague dirige la estrategia corporativa, las iniciativas de penetración de mercado y de field enablement para el negocio del impuesto sobre el valor añadido global (GVAT) de la empresa. El estilo de liderazgo de Steve se basa en su convicción de que, para que las organizaciones tengan éxito, deben comprometerse e invertir en los tres pilares estratégicos de la empresa: las personas, las prácticas y los productos.
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