Enhancing Data Quality Through VAT Verification
In our previous discussion, “The Butterfly Effect in the SAP World: Data Enrichment with CDQ Solutions,” we explored how VAT verification can enhance our data quality.
Today, we will delve into a free service provided by the European Commission for VAT verification and how this service can significantly improve our data quality. We will also examine practical examples of how we can utilize this in master data management.
Why Do We Need VAT Information?
VAT numbers are essential tools used to identify tax and financial transactions, guide the users for updates, and simplify processes. Within SAP, VAT numbers are crucial inputs for establishing a corporate identity. Therefore, we use VAT numbers on invoices to qualify for tax exemptions within the European Union.
VAT numbers consist of 15 alphanumeric characters, with each customer, vendor, or company having its unique VAT information. These numbers also include country codes; for instance, VAT numbers for Germany begin with “DE.”
This format allows us to determine the country associated with each VAT number.
VAT numbers play a vital role in creating customer, vendor, or company master data in SAP. To manage processes effectively, it is crucial to verify this data.
Users need to check the accuracy of these numbers manually on the European Commission’s website, which is time-consuming and prone to errors due to manual entry.
Using the VAT Service
After understanding the importance of VAT information, let’s briefly look at how we can leverage this service and its relationship with Master Data Governance (MDG).
Before using the service, we need to download the WSDL file for the VAT service from the European Commission’s website. You can access the WSDL file using the following link:
Once the WSDL file is downloaded, we can explore the service using a tool like SoapUI.
To do this, create a new SOAP project in SoapUI and enter the WSDL link in the initial WSDL field.
Next, select the “checkVat” service from the list on the left. Since we want to verify the VAT number’s accuracy, we will be using this service.
As shown in the example, when we send the country code and VAT number, the service returns the corresponding address and company information.
Additionally, we can check if the searched VAT number is valid within the European Union using the <valid> tag. This is a brief overview of how to use the service provided by the European Commission.
Reporting and Utilizing VIES in MDG
In the sample report we prepared regarding usage, we will examine whether VAT numbers from an Excel file are validated. By identifying invalid VAT numbers quickly, we can take necessary actions.
As illustrated, we checked various data from different countries loaded from an Excel format in just a few seconds, listing invalid VAT numbers on the screen.
Similar programs can facilitate more detailed reporting tailored to your objectives. For example, the accuracy of company names or address information can also be verified using VAT numbers.
Benefits of Using VIES in MDG
Tax identification is one of the most critical master data for a company. We previously discussed the importance and usage of VAT information.
In some cases, users may find themselves overwhelmed with massive amount of transactions. How much error can we tolerate during such operations? Ideally, we expect minimal errors in our work. For instance, consider transferring data between two systems; we would expect only up-to-date data in the receiving system. Given the potential for thousands of records, manually verifying outdated company data can lead to time losses, financial implications, and user-generated errors. Utilizing the VAT verification service helps mitigate these risks.
So, by using the service provided by the European Commission within SAP, we can examine several verification processes through our report. Here are some benefits offered by the VAT service:
“What about the benefits of combining this with MDG?”
- Verified data entry for customers and vendors
- High-quality master data
- Smooth business transactions
- Processes that do not require physical effort for verifications
- Operations free from human errors caused by physical entries
Using VIES in MDG
The VAT service not only plays a crucial role in indirectly reducing our costs but also enhances our data quality. Let’s illustrate this with an example scenario:
When a user inputs a tax number into a change request created in MDG, they can retrieve the following information via the service:
- Address information
- Company name
- Accuracy of the tax number
After entering the tax number, if any changes occur in the above fields, the same service will run again, and the verified data will be displayed once more. This allows users to check the accuracy of their entered data within seconds. Once the user approves, the information returned from the service is automatically populated in the necessary fields on the screen.
To illustrate, let’s examine the following visuals:
1. First, we add a new tax number.
2. Then, we trigger the service by pressing “ENTER.”
3. Next, the results returned by the service are presented in a pop-up window for the user’s approval.
If the user confirms this information, the address field and the business partner’s name will be automatically filled.
As demonstrated, we populated other fields by simply entering the tax number, ensuring that the entered VAT number is verified and processed accurately without the user error.
In this article, we addressed the significance of VAT numbers and their application within SAP MDG, illustrating how a small intervention can enhance your data quality. Furthermore, by utilizing this free service, it’s possible to eliminate unnecessary, outdated, and expired data from our systems.
|
