Global companies with operations in Latin America are often faced with a paradox. They’ve invested heavily in a global instance of SAP, and yet that investment doesn’t cover the unique financial compliance initiatives required by governments throughout Latin America.
To combat this issue, some companies expend even more by managing compliance internally – requiring up to 15 full time equivalents – or by moving compliance measures outside of SAP. Both of these options are costly mistakes. Internal compliance management requires constant fire drills to address issues and account for changes, taking time away from innovation and more profitable initiatives. Maintaining compliance outside of SAP, on the other hand, leaves companies vulnerable to errors and discrepancies that can result in costly audits, fines and penalties.
To effectively, efficiently and comprehensively comply with Latin America’s complex business-to-government mandates, companies must maintain compliance within SAP. However, that compliance strategy is not without challenges. The ever-changing and expanding e-invoicing and tax reporting requirements in Latin America make SAP implementation in this region more complex than anywhere else in the world.
In our new tip sheet, we examine the top 10 SAP implementation challenges in Latin America. These challenges – from customizations to support – encompass three main themes:
- Internal Processes – The requirements in Latin America often require changes to the typical processes and procedures employed by global companies. For example, in many countries, e-invoices act as a bill of lading and are required to ship, affecting logistics processes. In others, accounting requirements require significant changes to typical cost accounting structures. Understanding and adapting to these nuances is critical to effective compliance.
- Change Management – Change is the name of the game when it comes to compliance in Latin America. Just take a look here at the new requirements expected in 2016 – and those are just the major initiatives. Here is a closer look at 10 changes expected in Brazil alone this year. An effective compliance solution must anticipate and nimbly adapt to these constant changes with no operational disruptions or errors.
- Risk Avoidance – Ultimately, compliance initiatives must be focused on eliminating the potential for errors and data discrepancies. The more reports and procedures that can be automated, the better. Luckily, the standardization required in Latin America helps to pave the way for this automation.
For a deeper exploration of these core challenges, listen to webinar replay “10 SAP Implementation Challenges In LATAM”.