Steps that Stockbrokers Must Take to Comply with the E-invoicing Mandate in Malaysia
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E-Invoicing Malaysia: In our previous article, we discussed the latest e-invoicing mandate released by the Malaysian Government in an ongoing effort to make the financial system simpler. In this article, we share detailed steps that the stockbrokers with businesses in Malaysia must take to comply.
Stockbrokers in Malaysia need to take several steps to ensure that their invoicing processes align with the requirements set forth by the Inland Revenue Board of Malaysia (IRBM).
E-Invoicing Requirements in Malaysia: Understand the Requirements
Stockbrokers must first familiarize themselves with the specifics of the e-invoicing mandate. That is being implemented in Malaysia. Including the scope of businesses covered, the format of electronic invoices (MYS XML), and any additional compliance requirements imposed by the IRBM (ie: the QR code and invoice number generation and etc).
Assess Current Systems and Processes
Stockbrokers should assess their existing invoicing systems and processes to determine their readiness for e-invoicing adoption. This assessment involves evaluating the compatibility of their systems with the MYS XML format and identifying any gaps or areas that require enhancement or modification.
Implementing E-Invoicing Solutions in Malaysia
Stockbrokers that have high transaction volumes will benefit from implementing e-invoicing solutions that would enable them to generate and transmit electronic invoices in compliance with the IRBM’s requirements. Stockbrokers with lower transaction volume can opt to manually upload their invoices on MyInvois Portal hosted by IRBM, however, this portal is only suitable for a small volume of data and is feasible for Micro, Small, and Medium-sized Enterprises (MSMEs). NOVA’s e-Invoicing module is all set to automate the complete process for every broker transaction that needs to comply with this new regulation; including commission and clearing fee.
The solution is very much customise for the e-invoicing requirement for stockbroking industry in Malaysia. Users can set auto-alerts for all invoices in the system and the system can also be set to create the invoices, send them to the required authorities for digital signature, submit them to the IRBM system through APIs, and receive corresponding responses including error alerts, rejection or cancellation, and successful submission with generation of a QR code, invoice number and validation link.
Ensure Data Integrity and Security
Stockbrokers must implement robust measures to ensure the integrity and security of electronic invoices and sensitive financial data. This includes implementing encryption protocols, access controls, and data validation mechanisms to prevent unauthorized access, tampering, or data breaches. NOVA e-invoicing module integrates easily into brokers’ existing post-trade processing platform.
Empowering Staff and Stakeholders for E-Invoicing Success in Malaysia
Stockbrokers should provide training and guidance to their staff and stakeholders. For the proper use of e-invoicing systems and compliance with regulatory requirements. Training programs should cover topics. Including invoice generation, transmission protocols, data security best practices, and compliance procedures. However, with the NOVA e-Invoice system. Brokers only need to set up the alerts and data requirements one time. The system is equipped to generate auto-alerts after that and handle all the subsequent steps automatically.
Testing and Validating Systems for E-Invoicing in Malaysia
Prior to full implementation. Stockbrokers should conduct comprehensive testing and validation of their e-invoicing systems. So, as to ensure functionality, accuracy, and compliance with regulatory standards. This may involve conducting pilot tests, system simulations, and interoperability checks with trading partners and regulatory authorities.
Establish Compliance Protocols
Stockbrokers need to establish internal protocols and procedures for ensuring ongoing compliance with the e-invoicing mandate. This includes establishing audit trails, documentation requirements, and internal controls to monitor and verify the accuracy and integrity of electronic invoices.
Stay Informed and Updated
Stockbrokers should stay informed about any changes or updates to e-invoicing regulations and compliance requirements. That are issued by the IRBM or other relevant authorities. At Contemi, we do our best to keep our customers abreast of regulatory developments enabling them to adapt their systems and processes accordingly and maintain compliance with evolving standards.
By taking these steps, stockbrokers in Malaysia can ensure compliance with the e-invoicing mandate. With leveraging electronic invoicing solutions to streamline their operations, enhance efficiency, and contribute to the modernization of Malaysia’s invoicing ecosystem.
Kenneth Lim
Head of Professional Services
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