Microsoft Dynamics 365 | Financial Control and Reporting Framework in Business Central (Demo)
I’m going to show you how you can use Dynamics 365 Business Central to establish a sound financial control and reporting framework for your organization. It’s pretty easy to do. There are several key components to consider.
Chart of Accounts: The Foundation
First, we’ll delve into the chart of accounts, which serves as the foundation for any accounting system. In Business Central, this can consist of either a single account or multiple accounts with additional modifiers. The chart of accounts contains all the primary accounts within your organization. Moreover, we employ dimensions to further define the account strings used in transaction processing.
Navigating Foreign Currency
Here’s a chart of accounts here. You can see I’ve got the asset liability counts revenue and expense accounts, everything in this chart of accounts that I’ll be using to post transaction. I can also use dimensions in business central to further define the account strings. An account string would be a main account +123 or more dimensions.
Budgets for Financial Planning
Most organizations will eventually engage in transactions involving foreign currencies. Business Central provides comprehensive support for multiple currencies, ensuring transactions are accurately processed. This extends to the end-of-period reporting, including tracking realized and unrealized gains and losses. Business Central also automates exchange rate updates, an invaluable feature for organizations operating with foreign currencies.
Budgeting is another critical control component. Business Central allows you to establish an unlimited number of budgets, which can include preliminary, final, and forecast budgets for different periods throughout the year. The system integrates seamlessly with Excel, enabling you to edit budgets efficiently and import the updated data.
Reconciliation and Period Control
To maintain a robust general ledger, it’s essential to regularly reconcile detail ledgers with the general ledger. This process is particularly important for large accounts such as accounts receivable, accounts payable, and inventory. Business Central offers standard reports that simplify the reconciliation process.
Ensuring proper period control and cutoffs is crucial. Business Central allows you to set up posting periods for each user, guaranteeing that financial transactions occur within the appropriate time frames.
Reporting and Financial Statements
Now, let’s explore some standard reporting options within Business Central. This includes standard trial balance reports, offering both summary and detailed views. You can easily analyze your general ledger’s financial data.
Furthermore, Business Central features a standard Finance Report writer. This tool facilitates the creation of various financial reports, such as income statements. It allows you to generate reports based on the chart of accounts and compare actual data with budgeted figures, providing a comprehensive overview of your organization’s financial performance.
In summary, we’ve discussed how to use Business Central to establish a robust financial control and reporting framework. This encompasses setting up the chart of accounts, dealing with foreign currencies, managing budgets, reconciling ledgers, ensuring proper period control, and generating essential financial reports. With these tools and features, you can enhance financial management within your organization.