E-Invoice Fraud Check

Companies have been required to use e-invoicing since 1 January 2025. The aim is to promote the digitalisation of the German economy. All domestic companies and entrepreneurs - including freelancers who only have a permanent establishment in Germany - are affected.

An e-invoice is an invoice that is created in a structured electronic format that enables automatic and electronic processing. In contrast to conventional invoices, which are available as paper documents or unstructured files such as PDFs, e-invoices contain standardised data formats that facilitate the exchange and processing of invoice information.

The changeover promises efficiency, but also harbours new risks of fraud.

Companies must be technically and procedurally capable of receiving and processing e-invoices. Above all, this means preparing for the changeover and taking measures to protect themselves against fraud. The public sector has been gradually obliged to introduce e-invoices since 27 November 2018. This obligation has now been extended to all companies as of January 2025.

Fraudulent activities can no longer be easily identified in e-invoices on the basis of "suspicious-looking" physical or digitalised invoices. Instead, the anomalies in the data records must be recognised. Any documents accompanying the e-invoice data record, such as proof of performance and delivery notes, should also be checked for formal, visual and content-related irregularities. The security of the transmission channels and interfaces as well as the modifiability of the data should also be evaluated in order to identify manipulation risks.

We support you in recognising the dangers in e-invoices and establishing targeted prevention measures. With the KPMG E-Invoice Fraud Check, incoming e-invoices are automatically analysed for indications of fraud. In focus

• Internal consistency of the invoice
• Comparison with existing master data
• Comparison with purchasing and order data

During the check, the timing, content and logical aspects of the booking data in the company's ERP system are monitored and compared with the e-invoice data records. Significant indications of fraud may be contained in dates, automatically or manually created postings, payment terms and business hours, among other things. Conspicuous e-invoices are marked with red flags and the potential fraud categories are clearly displayed.

1. Prevention: Examination of a selected number of e-invoices using the described analysis routines.
2. Monitoring: Ongoing checking of incoming e-invoices for red flags.
3. Reaction: analyses in response to specific suspicious cases.