A mandatory change that can become an opportunity

From 1 January 2027, Slovak businesses and non-business entities will face one of the biggest changes in financial processes in recent decades: the introduction of mandatory electronic invoicing under the amended VAT Act.

At first glance, this may seem like just another burdensome legislative obligation. Experience from abroad, however, shows that companies and public-sector organisations that used the introduction of e-invoicing to modernise their processes achieved significantly higher efficiency, lower costs and better visibility over their finances. In other words, the resources invested paid for themselves many times over through the benefits achieved. The intended positive effect on more efficient tax collection was also clearly confirmed.

As an auditor and tax adviser, I still remember the time when bank statements were manually entered into accounting systems. In larger companies, this work took several days, and every typo meant a lengthy search for errors. Later, electronic bank statement imports were introduced, reducing a process that had taken days to just a few minutes. A similar change now awaits invoices, except that, unlike electronic bank statements, electronic invoices will be mandatory for most economic entities.

What will change from 2027?

Electronic invoicing will become the new standard for exchanging invoices in Slovakia. VAT payers will no longer send invoices by email or post. Instead of exchanging documents, suppliers’ and customers’ information systems will exchange data online directly with one another.

The obligation to receive electronic invoices will affect practically all legal entities, including companies, public administration bodies, municipalities, non-profit organisations, foundations and civic associations. The obligation to issue electronic invoices will apply to taxable persons in domestic business transactions under the VAT Act.

This change follows the European direction of VAT digitalisation, the ViDA initiative (VAT in the Digital Age) and the EN 16931 standard. Its aim is to introduce mandatory electronic invoicing in a structured format and the real-time digital transmission of selected transaction data to the financial administration. The measure is intended to reduce tax fraud, including so-called carousel fraud, and fully automate data exchange between the information systems of companies and the state.

An e-invoice is not a PDF

Many business owners still understand an electronic invoice as a PDF document sent by email. Under the forthcoming legislation, however, a PDF will not be considered an electronic invoice.

An e-invoice is a structured data file that an information system can process automatically without manual data entry. The invoice will not be sent by email but will be transferred securely between information systems through the PEPPOL network or certified communication channels. The result is faster document processing, fewer errors and complete traceability of the entire communication process.

Rather than building its own state platform, the Slovak Republic has decided to use the established international PEPPOL network (Pan-European Public Procurement OnLine), which enables the secure and standardised exchange of electronic invoices and other business documents. It was created in 2008 as a European Commission-funded project to support cross-border electronic public procurement. Today, its development is overseen by the non-profit organisation OpenPeppol, and the network is used by organisations in more than 40 countries worldwide.

A legal obligation can become a competitive advantage

It is important to understand that electronic invoicing itself is only the first step in digitalising accounting processes. Introducing the PEPPOL standard will eliminate the manual re-entry of invoice data and can reduce administrative workload by approximately 20 to 30%. However, it would be a missed opportunity to stop halfway and not make full use of the possibilities created by this legislative change.

The real benefits come from the comprehensive digitalisation of accounting processes, including online document approval, the digitalisation of all document types, such as receipts, automated accounting and the use of artificial intelligence. Combined, comprehensive process digitalisation can reduce the volume of manual work by as much as 80%.

It is similar to furnishing a new apartment. After moving in, many people decide that furniture has priority and that they will install the light fittings later. Instead, a bare light bulb hangs from the ceiling for months, sometimes even years. Digitalisation can end up the same way. Many companies and organisations implement only the changes required by legislation and postpone comprehensive process digitalisation indefinitely. Yet with relatively little additional effort, they could multiply the benefits of the entire transformation and fully use the potential within their reach. Those who understand this immediately gain an advantage over their competitors. It should also be noted that the largest companies and innovation enthusiasts have already digitalised all these processes, while others will benefit from having been ‘required to do so’.

The work of accountants will also change

The introduction of e-invoicing will not be only a technological change. It will also fundamentally change the work of finance departments.

The accounting profession will move to a higher level and gain greater recognition as an important partner to management. Accountants will spend significantly less time on monotonous data entry and more time on methodology, control, analysis and resolving exceptional cases. Routine tasks will gradually be taken over by automation and artificial intelligence. Information for decision-making will be available immediately rather than with a delay, and it will be more accurate. Greater emphasis will be placed on reporting and planning. Naturally, these outputs will no longer be compiled manually in Excel over many hours, but will be generated automatically by the system on request, according to management’s current needs.

Our experience from abroad, as well as from Slovak companies and organisations, shows that employee preparation is one of the most important factors in a successful implementation. If companies underestimate the need to change working habits, employees will naturally tend to continue using established practices, such as printing invoices or archiving them in paper form.

Timely employee training and an explanation of the benefits that the new solutions will bring to employees themselves should not be underestimated either. When employees understand that the changes will make their work easier, they are much more likely to accept them rather than hinder their implementation. Resistance to change is a natural human reaction.

AI as the next step in digitalisation

As mentioned above, electronic invoicing is only the first step towards radically eliminating unnecessary repetitive tasks in accounting.

Electronic invoicing will provide clean, structured data, but without configured automation algorithms, systems will not be able to post it automatically. Accounting departments will also still need to process other types of documents that are not covered by the introduction of e-invoicing, such as receipts, foreign invoices, delivery notes, contracts and other documents.

This is where OCR, automation and artificial intelligence come into play.

Modern AI solutions can automatically recognise data from documents, propose preliminary accounting entries, identify the supplier, assign a cost centre, route the document for the correct approval and, once approved, ensure automatic posting and the import of the invoice, enriched with additional data, into the accounting system. The result is not merely faster invoice processing, but the overall transformation of financial processes.

Digitalisation delivers measurable results

The benefits of digitalisation are no longer merely theoretical. In one large company processing thousands of invoices every month, we implemented the complete digitalisation of the accounting department. The solution included electronic invoice receipt, automated document processing using artificial intelligence, electronic approval, ERP system integration and a digital archive.

As a result, the entire process from receiving an invoice to its final posting is now automated, and manual employee intervention is required for only approximately 3% of all documents.

These results show that e-invoicing does not have to be merely a way to meet a legislative obligation. It can become an impetus for a fundamental increase in the efficiency of the entire finance department. It can even create additional financial benefits through the earlier collection of issued invoices.

How to choose the right partner, the digital postman

One of the first steps when introducing e-invoicing will be to select a certified digital postman. This is a specialised technology service provider, known as a PEPPOL Access Point, that acts as a secure intermediary between the supplier’s system, the international PEPPOL platform and the customer’s system. Its role is to receive an invoice from your software, verify its correctness and immediately deliver it securely to the recipient in any other system.

Some software providers, particularly foreign providers and smaller local or specialised accounting software providers, will not build their own digital postman service. In such cases, testing should begin earlier to verify compatibility with the selected digital postman and confirm that all settings work correctly.

When selecting a digital postman, companies and organisations should consider:

• readiness for Slovak and European legislation,
• support for the PEPPOL network,
• integration options for existing ERP systems,
• experience with implementations across the EU and with other international formats,
• the ability to apply OCR to extract data from other types of documents,
• the sophistication of approval processes,
• options for automating accounting transactions using AI,
• the speed of customer support responses to potential issues and requests,
• the long-term development of the solution,
• stability, experience and financial strength,
• data security and the recording of operations through an audit trail.

FITEK, your digital postman

Fitek Group, whose parent company is based in Estonia, is one of Europe’s leading providers of electronic document exchange solutions. For more than 13 years, it has helped companies digitalise their financial processes and now serves clients in 28 countries.

The Group has experience implementing electronic invoicing in countries where this method of document exchange is already a reality, including Belgium, Poland, Estonia and Serbia. It also operates as a certified PEPPOL Access Point, a digital postman, ensuring the secure exchange of electronic documents without requiring customers to replace their existing ERP solutions.

We further extend the benefits of electronic invoicing through the automatic extraction of data from any type of document using OCR, online approval processes and automated accounting.

Unlike most solutions on the market, every accounting document processed through our OCR service also undergoes human verification. By combining OCR, artificial intelligence and validation by our specialists, we contractually guarantee extracted data accuracy of 99.7%.

A unique part of the Fitek platform is FitekAI, an artificial intelligence solution that learns from the historical accounting data of each individual company. Based on previous accounting entries, it can automatically suggest postings, cost centres, project assignments, budget classifications and other accounting dimensions. Unlike traditional solutions based on fixed rules, FitekAI continuously adapts to changes in accounting practices and improves as the volume of processed documents grows, significantly reducing the amount of manual work performed by accountants.

It pays to start today

Companies, and especially public-sector organisations, should not wait until the final months before the legislation takes effect. Implementing electronic invoicing is not merely a matter of technically connecting systems. It includes selecting a digital postman, integrating it with an ERP or accounting system, configuring internal processes, testing, training employees and potentially digitalising related processes.

As the effective date approaches, a significant increase in demand for implementation services and limited supplier capacity can also be expected.

We recommend starting now:

1. analyse current processes,
2. assess the readiness of the ERP system,
3. select a certified digital postman,
4. prepare integrations,
5. digitalise approval processes,
6. automate accounting,
7. train employees.

Organisations that begin preparing in advance will have enough time for a high-quality implementation, avoid unnecessary stress and benefit from digitalisation even before electronic invoicing becomes mandatory.

Conclusion: A future worth looking forward to

From 2027, electronic invoicing will be a legal obligation for most entities. Whether it becomes merely another administrative burden or an impetus for modernising financial processes will depend on each company or institution.

The digital revolution in financial processes has already begun. Those who make full use of it will gain more efficient processes, lower costs, higher-quality data for decision-making and a significant competitive advantage.

A similarly positive change awaits the accounting profession. Routine tasks will increasingly be taken over by automation and artificial intelligence, allowing accountants to focus on higher-value work, including analysis, control, advisory services and support for management decision-making.

Mandatory e-invoicing marks the end of the era of paper documents and the beginning of a more modern and intelligent way of working. It is a change genuinely worth looking forward to.

The author of the article is Ing. Ivan Bošela CA, MBA
Managing Director, FITEK s.r.o.