Once upon a time there were two of them: The Bookkeeper and The One Who Sits on the Hill. The Bookkeeper was counting money, calculating and paying taxes so The One Who Sits on the Hill could collect them. Life was fair and peaceful. But one day The One Who Sits on the Hill wondered “How can I be sure that The Bookkeeper pays enough taxes?” Thus he summoned The Inventor and shared his doubts. “Not to worry,” reassured him The Inventor. “I’ll design a reporting form, The Bookkeeper would fill it in and you’ll keep everything in check.”
“Hm…” argued The Bookkeeper. “Look, what you’ve done: I have to count money, calculate and pay taxes, as well as fill in the form, while The One Who Sits on the Hill just collects the taxes. Is that fair?” “No problem,” The Inventor said. “I’ll create a computer system to manage the financial administration and print the tax form as well as other reports. Piece of cake!” And so the life became fair and peaceful again. The Inventor assisted both sides to change the rules and adjust the computer system. But one day The One Who Sits on the Hill complained: “Hey, Inventor! Why should I verify the data provided by The Bookkeeper manually? As if I have nothing better to do! I need my own system.” “Right you are!” The Inventor agreed. “You’ll have your computer system, where all the reports would be verified. Moreover, I’ll make it so that The Bookkeeper will report the data directly into your system. Hence you won’t need to re-type the printed reports.” “Wow!” The One Who Sits on the Hill exclaimed. “That’s great! Let it be so!” The Inventor kept his promise. But The Bookkeeper went furious, “Com’on! Now The Inventor overburdens me with work, while The One Who Sits on the Hill does nothing but collects taxes. That’s unfair!”
“Well people!” – sighed The Inventor. “I’ve got plenty of ideas: there is a system generating electronic taxation reporting with text or XML files. They will transfer the data from one system to another, even online. Forget data verification and deadlines! All you need is to push some buttons. Moreover, I’ve got another magic trick called XBRL. Your data will be mapped with the taxonomy elements and the system will generate an instant document for each report. The same system could be given to your banks and you won’t have to worry about making and validating reports.” “Huh!” exclaimed The Bookkeeper and The One Who Sits on the Hill in unison, “We don’t understand a word of it. However… as you’ve never let us down before, do what you think is best.” The One Who Sits on the Hill puffed his chest, “Let’s call it a Law and you, The Inventor, will be responsible for our systems’ legal compliance.” Upon reflection The Inventor replied: “Hey! But then we all will become The Ones Who Sit on the Hill!”
A few years back European tax laws were changed, to require VAT-registered businesses to make online declarations. Fiscal authorities and tax payers have subsequently invested in relevant new technologies. However, online reporting still remains country specific, which is a major potential headache for law-abiding companies. Exact has set out to remedy this situation. We are devoting considerable resources to research and development, designing electronic forms to help individual customers translate their electronic registries and filings into solid legal compliance. A full implementation of these new functionalities has already taken place in the Netherlands, Belgium, Germany, France, Spain, Italy, Luxembourg and in some other countries. Watch this space for more!