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When it comes to understanding how tax and technology are reshaping finance, Alex Baulf sits right at the centre. In his role leading Global Indirect Tax and E-Invoicing at Avalara, he spends his time tracking regulatory change, advising organisations and engaging directly with government departments as they tackle the challenges created by the latest technology innovations.
He sits in the centre for another reason too. Not only is Alex a member of the European Commission’s e-Invoicing Technical Advisory Group, but he also serves on the board of the Digital Business Networks Alliance in the US. In short, if you want to know about e-invoicing, Alex is the person to turn to.
His first observation: that technology’s progress has sent shockwaves through the industry. Finance, a role that has traditionally operated as “backwards looking”, has transformed in recent years into an “ongoing, live process”, he told us. Now, finance teams must not only contribute towards “present and future-oriented decision making” but are also forced to keep consistently up to date with the ever-developing technology driving this change.
Even with these rapid advances and the best efforts of finance leaders, Alex sees a clear gap between what’s possible and what’s happening in practice. He points to the Accounts Payable process as the greatest culprit, as teams continue “keying invoice data into systems by hand, chasing approvals over email and reconciling differences in spreadsheets.” A workflow that is both slow and costly.
But Alex sees significant opportunity within this shift. As organisations begin to adopt tools such as e-invoicing, the quality and accessibility of data improves drastically. Alex notes that when you know “the data is reliable, you spend less time checking numbers and more time understanding what they show”. Looking ahead, he believes this will only accelerate, with AI helping teams to “spot insights sooner, catch issues early and make stronger decisions” as data quality continues to improve.
It’s this combination of opportunity and challenge that raises a natural question about the nature of change in the world of finance – and what companies are still getting wrong.
The finance function has changed a lot from what it looked like three to five years ago. What used to feel like a backwards looking job is now an ongoing, live process, which requires a slightly different set of skills. This is particularly true when it comes to tax.
Nowadays, accounting and finance teams’ expectations extend far beyond reporting outcomes into present and future-oriented decision making. They have to be aware of developments in IT systems, the business model and existing workflows. For businesses, this means hiring and training tax professionals for a changing skillset, an increasing need for oversight of the financial process and a closer partnership with IT.
Despite new technologies available, many companies are still stuck in the past, relying on outdated and manual processes. This will ultimately harm these businesses.
The Accounts Payable process is the obvious one to me. In far too many businesses, invoice processing is still incredibly manual and old-school. People are keying invoice data into systems by hand, chasing approvals over email and reconciling differences in spreadsheets. It’s slow and frankly frustrating.
This all takes time, which means it costs money. Manual entry also increases the risk of simple mistakes that can open the door to fraud or compliance issues. Perhaps most importantly, it also ties up skilled finance people in repetitive work instead of letting them focus on things that add value. Similarly, VAT return preparation continues to be far too manual. Many organisations rely on spreadsheets and complicated formulas to meet HMRC’s digital links rules. It works for now, but it leaves the business exposed. If one person leaves or a formula breaks, everything slows down and transparency disappears.
Why the delay? Many organisations stick with old systems because migrating means spending money, retraining staff and disrupting operations that currently work just fine. There’s also the simple reality that people get comfortable with established processes and change feels risky or strange. Having said this, we know that businesses that do not make the change now will struggle once they are forced to do so.
Finance teams use tax and transaction data to make smarter pricing decisions. They also use this data to shape their supply chains, plan market entry and improve customer experience.
E-invoicing, for instance, gives you cleaner data at the source. When the data is reliable, you spend less time checking numbers and more time understanding what they show.
E-invoicing also gives businesses a real time view of how transactions move between suppliers, logistics partners, and buyers. By reviewing inbound e-invoices to track cost changes by region and by vendor, organisations see how spend shifts over time. Similarly, timestamps across the invoice lifecycle show when an invoice is issued, delivered, accepted, and paid. So, they will spot delays in the process and fix them quickly.
AI works best when it is combined into well-governed processes. This means having clear data lineage. When this approach is taken, it speeds up finance and makes the process much more resilient.
We use AI throughout our tax technology because it helps make daily tasks easier. One example is using AI to read and understand vendor PDF invoices. It pulls out the data, checks it and makes sure the tax is correct before sending it into the ERP. Another area of AI where we are finding immediate value is in interpreting official error responses from tax authorities. These messages are often highly technical and difficult to understand. By using AI to explain what went wrong and how to fix it, we are reducing resolution time and avoiding delays in submitting e-invoices to authorities.
AI has already made a significant impact on our finance and accounting workflows by cutting manual work and improving speed and accuracy. But across the industry, there’s still a lot more it can do. AI should be used as more than an automation tool for existing processes, it should help teams spot insights sooner, catch issues early, and make stronger decisions.
As data quality improves through digitisation efforts like e‑invoicing, AI will be able to play an even bigger role: identifying anomalies, predicting cash‑flow and tax risks, and helping teams focus their time on important tasks.
The biggest challenge is that these systems that were implemented (ERP, payroll, billing etc.) were done so at different times, for different reasons and by different teams. The result is an inconsistent master data set, duplicated logic and manual reconciliation layers.
When there are discrepancies in data, finance teams are forced to spend valuable time explaining differences instead of analysing performance or performing other strategic tasks. Integrating these systems is a significant challenge ultimately demanding a holistic language and corresponding practices that allows these different systems to communicate with each other in a productive manner.
The key to achieving this balance is in designing the correct controls into the automating process. They should be part of the same design. This is distinct from adding them on after. If a process can’t be clearly documented and explained to an auditor, it shouldn’t be automated. That’s exactly the kind of thing that won’t pass audit.
Speed might feel like the antithesis of control, auditability and regulatory compliance. Yet control, auditability and regulatory compliance become fundamental pillars of automation. This is especially the case for those that want to increase speed consistently over time rather than one quick fix.
Data literacy, systems thinking, and the ability to work across different teams are now essential. I don’t think finance professionals need to be developers, but they should understand how data moves through systems, where the controls sit and how automation affects outcomes.
Speaking specifically from a tax perspective, there’s an increased expectation that teams can use tax technology in their day to day, rather only at the end of the financial year.
This means that they need to understand how the tax process works and be familiar with e-invoicing platforms and reporting tools. It also means knowing how all of these things connect to the core systems and how they are maintained.
I’d also expect teams to know where exceptions might appear and be able to manage them. This means that accounting and finance teams need to be trained on being responsible “gatekeepers” of data instead of just being a user.
Collaboration between finance teams and the rest of the businesses has increased and improved significantly, particularly when it comes to the way that IT, operations and logistics work. This change has been driven by both regulatory and digital change.
Finance and tax are increasingly working alongside logistics teams on HS code classification, country-of-origin data and the tax and customs treatment of imported and exported goods. This collaboration is because errors in each of these areas now surface quickly through audits, customs authorities and e-invoicing or trade reporting requirements. There’s also closer alignment with IT to ensure that tax and regulatory requirements are clearly understood and correctly integrated in systems. We’re no longer seeing this treated as a ‘later down the line’ fix.
Procurement is another key area of collaboration. I’ve seen this first hand around supplier onboarding, invoice quality, tax determination and compliance. However, it’s worth noting that friction still arises when finance is brought in too late, often to approve decisions already locked into systems or contracts. This is a symptom of continued linear thinking in business processes. The most successful organisations position finance and tax as partners in the decision-making process rather than making them act as checkpoints.
Organisations are completely changing how they approach compliance. They’re moving away from reactive compliance towards more integrated controls. Those furthest ahead here are investing into automation, improving their data governance and defining ownership across systems and processes. As an example, one major benefit of automation is increased oversight and transparency. This enables finance teams to swiftly identify how regulatory changes will impact whole business processes.
Start with a real problem, not a technology. Finance leaders are mounting pressure to digitise, often driven by regulatory change in tax and e-invoicing. The mistake is treating this as a technology upgrade rather than a response to a real business challenge.
So what can businesses do?
They can start by identifying where tax complexity, manual compliance processes, poor data quality, or audit risk are creating friction today. The goal isn’t to bring in new technology for its own sake, but to reduce compliance risk, remove manual checks, speed up reporting, and give finance teams trustworthy data. When people understand why this matters, it’s much easier to get their support.
In the same vein, tax and e-invoicing need to be understood as part of how the business actually runs. Finance leaders play a key role in helping people see how new rules shape processes, data, and day-to-day operations across the organisation. So by helping teams see the broader impact, they shift the mindset and help finance move from reacting to changes to planning ahead of them (even with limited resources).
Looking ahead, the finance function will be judged less on output and more on data quality, resilience, and its role in decision support. Closing the books accurately will not be enough. The data must be trusted. It must be usable in real time. It must guide the choices the business makes.
This shift calls for broader skills. Finance, tax, IT, and engineering teams will need to work together on end-to-end processes. The work will become more connected. Teams will rely on shared systems and shared ownership.
Real time reporting and e-invoicing rules are increasing. And so, tax and finance teams will be judged on how well they help the business stay compliant across markets without slowing growth. Finance will be seen as a partner across the organisation. The right technology, applied with a clear purpose, supports that role and helps the function operate at scale.
