How Intrastat Reporting Leads to Procurement Efficiencies at eir

This submission from Anthony Ryan, head of Procurement Operations, eir, the Dublin-based telecommunications company, although rather more technical in nature than our usual posts, is a valuable description of how he automated what was a painful process of reporting receipt and tax information for goods from foreign investors through Intrastat, the HMRC method of collecting information and producing statistics on the movement of goods between Member States of the European Union. We hope this will be helpful to all our readers who buy and sell among member states and therefore have to use Intrastat. 

For anyone new to Intrastat reporting, the Revenue commission in your country will want a monthly report that details products you have imported (procurement side) and exported (sales side), classified by a harmonised tax code used across Europe (HS TARIC code).  There are slightly less than 26,000 codes but you will only need to focus on the ones specific to your industry.  HS TARIC codes are quite logical in that they have the following structure. The first 2 digits are a high-level Parent category (i.e. 01 = Live animals). The next two digits are the first child category (i.e. 0101 = Live animals: horses, mules, etc). The next two digits are further refinements, Parent-child-child (i.e. Live animals: horses – thoroughbred …).  You can see how this extends (01010101). Within each level there can be up to 99 values (01-01-42-99).

The starting point for your analysis will be to determine which items you are purchasing from foreign suppliers and how they are categorised by Commodity. At eir, we found that approximately 1,500 items were coming from foreign suppliers.  These items were mostly lumped into high-level commodity codes that provided virtually no granularity. Tracing the HS TARIC codes in a table pulled down from the European Commission website  (HS TARIC FAQs), we discovered these items fell into approximately 60 unique categories for tax coding purposes. There were 3 or 4 high-level categories (Parent – Child – Child) and most fell into the fourth branch of the Commodity tree (Parent – child – child of child – child of previous child).

This realisation caused us to examine the current Commodity codes in use. The lack of alignment to this parent-child structure was obvious. We redesigned the Commodity tree for these items into the same logic called out in the HS TARIC table. This structure is essentially the same as the UNSPSC codes as well, so as we mature in our Commodity planning, we will eventually kill two birds with one stone (automate Intrastat and facilitate UNSPSC functionality – reporting, RFP ….).

Business Benefits

A number of tangible benefits arose because of this Intrastat project:

  1. Intrastat reporting is dynamic and requires no administrative effort to generate (significant admin effort savings)
  2. Catalogues are vetted before uploading to the P2P system, to ensure correct alignment with Commodity codes
  3. This reduces potential errors on the Intrastat report and improves reporting across commodities
  4. Spend by commodity is more accurate
  5. Workload by Category Manager is more accurate

This project was viewed as a very significant efficiency gain by procurement, finance and internal audit.


Let’s review the mechanics of how this is orchestrated in Coupa (our P2P SaaS application).  The solution is designed around stringing a series of custom fields together. Start with the Commodity object. Create a new custom field labelled HS Code. Load from a .csv file, your redesigned Commodity tree structure, each with its own HS Code. (We chose to create an HS Code field (value defaults from Commodity) on the PR line item and also on the PO line item for visibility throughout the process but the PO Line item is sufficient.) The field should not be editable.  Create a custom field on the Receipt object which defaults from the order line item.

Some of the values required for the Intrastat report are supplier-specific.  You will need to create custom fields for Supplier Country and Incoterms, then populate this on the relative suppliers. To be able to pass the Supplier Country and Incoterms to the receipts, create custom fields on the PO Header object. Create corresponding fields on the Receipts object to default values from the PO header.  If your supplier always uses the same Mode of Transport (i.e. sea, air, road …) you can put this field on the supplier record, otherwise you will need to put it on the PO header and default it onto Receipt object.

Finally you are ready to configure an Intrastat list view. The conditions for the list view should be Receipts Created last month and Country of Origin Does Not Contain your home country.  The columns will contain Receipt date, HS Code, Country of Origin, Incoterms, Mode of Transport, Unit Weight, Quantity, Price …  The last step before the system is live, is to reclassify your Items into the new Commodity tree structure (load from file).

Good luck with your own reports …

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