Setting up a chart of accounts in Microsoft Dynamics 365 Finance and Operations requires prior analysis and planning for how accounts and dimensions will be set up.
Therefore, before configuring your charts of accounts, spend some time thinking about the most correct and efficient way to set it up. Luckily, Microsoft has made some helpful improvements to simplify the process.
Here, we’ll list out five key improvements for accounting in Dynamics 365 (D365) Finance and Operations — specifically, installed product version 10.0.8 and installed platform version: Update32.
1. Export account structures to Microsoft Excel.
One major improvement is that you can now easily export the account structure to Excel and edit it there. Moreover, you can activate or deactivate account structures and easily manage all lists.
Here are some tips for doing this:
Option 1: Open in Excel. Click “Account structure allowed values.”
In Excel you can modify for example segment criteria and publish it. All changes will immediately be displayed in D365.
With the function Export to Excel, “Segments and allowed values,” you can export the same structure, but you will not be able to publish data to D365.
Option 2: Open in Excel. Click “Account structures (unfiltered).”
With this option, you can view a list of account structures, add/modify the details as segments, status and description, and publish to D365.
Option 3: Open in Excel. Click “Account structure activation (unfiltered).”
In addition, you can activate or deactivate account structures in Excel and publish those changes.
2. View ledgers and advanced rule structures on one page.
A further advantage is that you can view ledgers and advanced rule structures that are associated with an account structure on a single page.
Now, you can see all the related advanced rules for the specific account structure in one place — as well as the list of legal entities that use this account structure.
3. View ledgers that are associated with a chart of accounts on a single page.
An additional improvement is that you can now see the list of all charts of accounts and legal entities that use this chart of accounts in one place. This helps keep things organized and easy to understand.
4. Easily view closing sheet adjustments and transactions.
Another improvement to the chart of accounts in Dynamics 365 is that you can now view closing sheet adjustments and closing transactions in separate columns on the trial balance list page.
This improvement allows for more concise data analysis and is also required for regulatory reporting in some countries/regions.
Here are a few steps for how to achieve this:
1. Display segments in separate columns. This helps you to see the data for dimensions in their own separate columns.
2. Show opening transactions in the “Opening balance” column. When you close the year (using the year-end close functionality), the opening transactions are created. You can include or exclude these amounts in the “Opening balance” column. If you don’t select this option, opening amounts will be displayed in the “Debit” or “Credit” column.
3. Include closing period adjustments in balances. With this option you can include or exclude the closing adjustment in balances. There are few ways you can create adjustments for the closing year:
- Post adjustment transactions using the general journal or
- Use the closing period adjustments functionality. All adjustments posted through this functionality have the type “closing” and will be displayed in a separate column called “Closing period adjustments” if you select this option in trial balance.
4. Include closing transactions in balances. The closing transactions are created optionally and depend on the general ledger set up, as shown below.
If the parameters are configured like above the additional closing transactions are created during the closing year (year-end close functionality). These transactions will be included in separate column called “Closing transactions”. Note, that these settings affect the “Closing balances” column in trial balance.
5. Use the accounting source explorer for a better view of all transactions.
Another new and improved feature in D365 is the accounting source explorer page. With this functionality you can see the fullest information about transactions on the one page, as well as view source documents and vouchers related to specific transactions.
The accounting source explorer tool shows the same amounts as the trial balance. Therefore, it’s a useful tool to compare subledger with ledger amounts. You can use this during year-end to compare inventory amounts with general ledger accounts, or to compare customer aging reports.
Now with the accounting source explorer functionality, it will be easier, as there is a lot of additional information related to transactions such as product name, quantity, project information, document text, document description, party number and name, and more.
For example, some of the improved functionality includes the ability to:
- Select any period to display all the posted transactions. Note that dates must be in the same fiscal period. View the source document (purchase order, invoice, etc.) of the transaction. View the voucher transactions (including the accounting entry in the general ledger.
- Apply different financial dimension sets to see dimensions (business unit, cost center, etc.) in separate columns.
With these new features, working with accounts in Dynamics 365 is easier and faster.
If you’d like help maximizing your capabilities with accounting in Microsoft Dynamics 365 Finance and Operations, feel free to contact us for support.
About the author
Olena Potapenko, Financial Consultant
Olena Potapenko is a Financial Consultant with a broad experience. She’s been working with Dynamics AX since 2013 (such version as AX 2009, AX 2012 and Dynamics 365 Finance and Operations). Also was involved in various types of AX projects, such as upgrade, implementation or support as a Financial Consultant. She’s been on a finance path from the start, as she graduated from university with a financial focus. Olena is happy that in her current profession she was able to combine finance, IT and communication with people.