Good morning, how are you doing? Let’s learn together the
below Concepts related to D365.
Trade and Logistic Basic Concepts :
- Legal entities - an organization
that is identified through registration with a legal authority.
- Operating
units: an organization that is used to divide the control of
economic resources and operational processes in a business.
- Number
sequences - Number sequences are used to generate readable, unique
identifiers for master data records and transaction records.
- Currencies: It's used
to stored monetary values.
- Calendar: Calendars describe
the capacity and working times of operations resources
- Chart
of accounts - A chart of accounts is a collection of accounts that
define a financial framework. To further track the transactions in these
accounts, you can add segments. These segments are known as financial
dimensions. For example, an expense account might include financial
dimensions that are named Department, Cost Centre, and Purpose.
- Account
structure : Account structures use the main account and financial
dimensions to create a set of rules that determine the order and values
used when entering the account number. You can set up as many account
structures as you need for your business:
Example
: To illustrate a best practice for setting up an account
structure, let's assume that a company wants to track their balance sheet
accounts (100000..399999) at the account and business unit financial dimension
level. For revenue and expense accounts (400000..999999), they track financial
dimensions Business Unit, Department, and Cost center. If they make a sale,
they also like to track Customer. Using this scenario, it would be recommended
to have two account structures assigned to the company's ledger - one for
Balance sheet accounts, and one for Profit and Loss accounts. To optimize the
user experience and validation, Customer should be an advanced rule that is
only used when a sales account is used.
· Balance
sheet account structure
|
Main account |
Business unit |
|
100000..399999 |
*;" " |
· Profit
and loss account structure
|
Main account |
Business unit |
Department |
Cost center |
|
|
400000..999999 |
*;" " |
*;" " |
*;" " |
*;" " |
8 Ledger: The Ledger page lets you select the chart of
accounts and the account structures that will be used for the selected legal
entity
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Inventory
- Item Group: Item groups are used
to manage inventory by dividing inventory items into groups. Click Inventory management > Setup > Inventory > Item groups.)
- Item Model Group: The item model group field is used to determine how items are
controlled and handled on receipt, issue, and also calculating consumption.
Like FIFO, LIFO etc.
Dimension Groups : The inventory dimensions can be assigned to inventory dimension groups:
Product dimension group:
- Configuration
- Color
- Size
·
Storage dimension group:
- Site
- Warehouse
- Location
- Pallet ID
·
Tracking dimension group:
- Batch number
- Serial number
The storage dimension group and the tracking dimension group do not have to be associated with a product until after the product has been created.
- Inventory
Parameters
Procurement Basic setups
Procurement basic setups
- Terms
of payment: The Terms of payment field
represents the calculated due date to pay the vendor – like 30 Days.
- Method
of payment: The payment method refers to the way the vendor is
paid, whether by check, bank transfer, or cash
- Vendor group: Vendor group is segmenting your vendors and being able to capture them in GL separately using group
- Vendor posting profile: Vendor
posting profiles enable you to assign general ledger accounts and document
settings to all vendors, a group of vendors, or a single vendor. These settings
will be used when you create purchase orders, vendor invoices, and cash payments
- Terms
of payment: The Terms of payment field
represents the calculated due date to pay the vendor – like 30 Days.
Sales basic setups
- Customer posting
profile - Customer posting profiles let you assign general ledger accounts and document settings to all customers, a group of customers, or a single customer. These settings will be used when you create sales orders invoices, free text invoices, project invoices, payment journals, collection letters, and interest note
Payment Process, Quotations and Procurement category
- Vendor
payments and its setup : Go to Navigation pane > Modules > Accounts payable > Payments > Payment journal. Click New. Select the payment journal in which to save the vendor payment
- Customer payments and its setup : Go to Navigation pane > Modules > Accounts receivable > Payments > Payment journal.
Procurement category
- Category
and its significance -
- Purchasing,
Policies
Policy rules
Catalog policy rule
The catalog policy rule determines which procurement catalog users see when they create purchase requisitions. If a user has been granted permission to order products on behalf of another user, the requisition uses the catalog policy rule that is defined for the requester’s legal entity and operating unit to determine which catalog to display. Before you can define a catalog policy rule, you must create and publish a procurement catalog.
Category access policy rule
The category access policy rule determines which categories users have access to when they create purchase requisitions. If no rule is specified, all the procurement categories can be added to the purchase requisition.
- Select the Include parent rule option to apply the category access policy rule of the parent organization to the category.
- In the Available categories pane, select the categories that the rule applies to. When you select a category, all categories that are higher in the hierarchy are also added to the Selected categories list.
- Select the Include subcategories option to apply the rule to all subcategories of the selected category.
Category policy rule
The category policy rule defines how users can select vendors for each category. It also defines requirements for the receiving and invoicing processes.
Re-approval rule for purchase orders
The re-approval rule is an optional rule that defines the criteria for requiring re-approval when a purchase order is changed. The selected fields are evaluated in the purchase order workflow when the "Requires purchase order re-approval" condition is set up in the workflow.
Note
Accounting distribution will always be reset when an approved purchase order with change management enabled is changed. So you should be aware that if you want to avoid a re-approval of a purchase order when certain fields are changed, the field Accounting distribution.changed should NOT be included as a selected field for re-approval.
Purchase requisition RFQ rule
The purchase requisition RFQ rule defines criteria for requiring a request for quotation (RFQ) for a purchase requisition line. If a line meets the conditions, the "informal RFQ" or "formal RFQ" stamp appears on the requisition line.
Purchase requisition control rule
The purchase requisition control rule for requisitions of type consumption is an optional rule. When you create rules of this type, you can set options on various tabs:
- On the Workflow submission tab, you can configure the fields that must be entered on the requisition line for the requisition to be submitted for approval.
- On the Order quantities tab, you can configure the fields that are required on the purchase requisition under certain conditions. You can also enforce order quantities.
- On the Dates tab, you can configure whether the accounting date is the same as the requested date
- On the Address tab, you can define whether the user is allowed to create new addresses in the system to apply to the purchase requisition.
Requisition purpose rule
The requisition purpose rule is an optional rule that determines the type of requisition purpose that is allowed for a specific legal entity. Unless another purpose is indicated in this rule, requisitions automatically have a purpose of Consumption when they're created.
Replenishment category access policy rule
The replenishment category access policy rule is an optional rule that determines the products that are available to fulfill requisition demand for a specific legal entity when the requisition purpose is Replenishment.
Replenishment control rule
The replenishment control rule is an optional rule that defines the fields that must be entered on the requisition line for the requisition to be submitted for approval when the requisition purpose is Replenishment.
Purchase order creation and demand consolidation rule
The purchase order creation and demand consolidation rule defines the policy rules to use when a purchase order is generated from an approved purchase requisition. When you create rules of this type, you can set options on various tabs:
On the Purchase order split tab, you can define criteria for splitting purchase requisition lines onto separate purchase orders.
On the Price/discount transfer tab, you can define when to recalculate the price agreement when a purchase order is created:
- Only if no trade agreement – Prices and discounts are transferred from the purchase requisition only if there's no applicable trade agreement or base price. If a trade agreement or base price exists for the item or vendor, the prices and discounts are recalculated based on the trade agreement or the base price, and are applied to the purchase order. Unless otherwise specified, this is the default behavior.
- Always – Prices and discounts are always transferred from the purchase requisition.
You can also allow the requester to change the method of price and discount transfer for individual purchase requisition lines, regardless of the price/discount transfer rule that is defined. Select the Allow manual override per purchase requisition line option to enable this capability.
On the Item description transfer tab, you can transfer the item description from the requisition when it originates from an RFQ.
On the Price Tolerance tab, you can define rules to route approved purchase requisitions back through the review process when the price of a procurement catalog item increases. Set the maximum amount that the net amount on a line item on a purchase requisition can increase between the time when the purchase requisition is approved and the time when the purchase order is created. The net amount is calculated by using the following formula: ([Quantity × (Unit price – Discount) ÷ Price unit] + Purchase miscellaneous charges) × (100 – Discount percent) ÷ 100 Purchase requisition lines that exceed the price tolerance that you set are held for manual processing. The rules that you configure on the Error processing tab determine how the purchase requisition lines are processed.
On the Error processing tab, you can configure the processing rule that is applied to a purchase requisition if it fails validation during purchase order creation because of a vendor error or a price tolerance error. Select one of the following options:
- No action – The purchase requisition lines remain on the Release approved purchase requisitions page. The status of the purchase requisition lines remains Approved. However, the errors must be resolved before a purchase order can be generated for the purchase requisition lines.
- Cancel the purchase requisition line – The purchase requisition lines are canceled. The requester can create a new purchase requisition for the canceled lines if they still want to request the line items.
- Create a new purchase requisition line – The purchase requisition lines are canceled. New purchase requisitions are then generated that contain only the purchase requisition lines that failed validation. The new purchase requisitions that are generated have a status of Draft. These purchase requisitions can be resubmitted for review after the validation errors have been resolved. The preparer of the purchase requisition lines is notified that the lines were canceled, and that new purchase requisitions were generated for the purchase requisition lines that failed.
On the Manual purchase order creation tab, you can define the parameters that determine whether a purchase requisition must be manually processed, or whether it can be automatically converted to a purchase order. The parameters can apply to internal catalog items, external catalog items, or non-catalog items. Select one of the following options:
- Manually create purchase orders – Manually create purchase orders for all purchase requisitions.
- Automatically create purchase orders – Automatically create purchase orders for all approved purchase requisitions. No purchase requisitions are held for manual purchase order creation.
- Automatically create purchase orders except under these conditions – Manually create purchase orders for purchase requisitions that match the criteria that you define. All other purchase requisitions that are approved are automatically converted to purchase orders. If you select Automatically create purchase orders except under these conditions, you can add procurement categories and vendors to specify which approved purchase requisition lines are held for manual processing. This option can apply to internal catalog items, external catalog items, and non-catalog items. When you select a procurement category, any subcategories for that procurement category are also selected. Select the All option for a specific type of purchase requisition line to hold all lines of that line type for manual processing.
If you want purchase orders to be generated automatically from approved purchase requisitions when the batch job for purchase order generation runs, select the Run automatic purchase order creation as a batch job option. This option applies only to purchase requisitions that don't require manual processing. By running automatic purchase order generation as a batch job, you can schedule this activity at a time when resources are less constrained. If the Prepayment required option is selected on the purchase requisition lines, select the When the requisition is set up for prepayment option to hold approved purchase requisitions for manual processing. Purchase requisitions that are held for manual processing can be filtered so that you can view only those purchase requisition lines that require prepayment.
On the Demand consolidation tab, you can define the parameters that determine whether purchase requisitions that are manually processed can be considered for purchase requisition consolidation. The parameters can apply to internal catalog items, external catalog items, or non-catalog items. Select one of the following options:
- Do not allow demand consolidation – No approved purchase requisition lines are eligible for demand consolidation. This option is selected by default and applies only to purchase requisition lines that require manual processing for purchase order creation.
- Always allow demand consolidation – All approved purchase requisition lines are eligible for demand consolidation. Note: If you select the Always allow demand consolidation option on the Demand consolidation tab, but you select the Automatically create purchase orders option on the Manual purchase order creation tab, all purchase requisitions are held for manual processing.
- Allow demand consolidation under these conditions – Define the criteria that determine whether approved purchase requisition lines are eligible for demand consolidation. For each type of purchase requisition line, you can set the criteria by procurement category and vendor. If you select Allow demand consolidation under these conditions, you can set the criteria by procurement category and vendor for each type of purchase requisition line. When you select a procurement category, any subcategories for that procurement category are also selected. If you select the All option for a specific line type, all purchase requisition lines of that line type are eligible for demand consolidation.
Serial and Batch Numbers
SERIAL NUMBERS: Firstly, you have to know that serial numbers belong in the category of tracking dimensions. As such, tracking dimensions essentially allow us to ensure:
Traceability |Quality assurance |Warranty compliance
The main difference between serial and batch numbers is that serial numbers apply on a single-item basis. Whereas batch numbers apply to groups of items. Using Dynamics 365, we can assign a serial number to an item, and then, it would reflect on the inventory transactions with the product.
HOW DO YOU USE SERIAL NUMBERS?
You either can manually or automatically assign a serial number to a product on the receipt. Mainly, you want to use serial numbers for these purposes:
BATCH NUMBERS : Do you remember the difference we mentioned before? Batch numbers, unlike serial numbers, only apply on a group basis. However, they’re both tracking dimensions. Here’s how it works.
The first rule is creating the Batch Number before assigning it to the product. The second rule states that you cannot use the Batch Number field on the order line to change it, which is different compared to serial numbers.
Register an inventory item upon arrival. Work on a product within a sales or purchase order line. To decide how you will assign them, it depends on whether the item has a serial number that you can scan and enter into Dynamics 365 SCM. Otherwise, on whether the item will belong to a serial number group.
HOW DO YOU USE BATCH NUMBERS?
Whenever we use the Batches page to create or view batch
numbers, we can create Tracking numbers and these will be assigned to a
product. However, keep in mind that Tracking numbers can apply to both serial
and batch numbers. Moreover, we can assign serial and batch numbers to various
products in sequence from the same number group.
- Automatic number allocation |Automatic activations
- In this way, let’s begin with number allocations.
With the General field group in your Tracking number groups,
we will use the following fields to specify how to assign the number:
Manual: By selecting this, serial and batch numbers would
need to be manually assigned to the products in the number group.
Only for inventory transactions: Use this to assign the
numbers to a transaction instead of an order line. In this way, for example, we
could generate serial or batch numbers with each purchase order.
On physical update: This option assigns the generated number
to a product involved in a transaction. Unless you have a packing slip and
picking list registration, the serial and/or batch numbers will not generate.
Per qty: You can use this and specify the quantity of
products that will have a generated number assigned. However, keep in mind that
the slider Only for inventory transactions must be selected for it to work. If
you want unique serial numbers for each item, type 1 in this field.
Quarantine Management, Trade & Logistic Item Registration
- Quarantine
Management Setup
- Quarantine
Warehouse Setup
- Quarantine
Parameters
- Quarantine
Item Management
- Quarantine
Processing
- Manual
Quarantine Orders
- Automatic
Quarantine Management
- Quarantine
Order Processing Options
- Inventory
Transactions on Quarantine Items
Trade & Logistic Item Registration
- Item
Registration Setup
- Automatic
and Manual Registration of a Pick
- Item
registration of serialized and batch inventory
Reservations
- Reservation,
Dimensions and Transactions
- Reservation
parameters
- Manual
Reservations
- Automatic
Reservations
- View
Reservations
- Lock
Reservations
- Cancel
Reservations
- Batch
Reservations
- Picking
Reserved Items
Inventory Journal
- Inventory
Journal general setup
- Journal
Names
- Dimensions
and more
- Posting,
Profit/Loss (Adjustment) and movement Journal
- Transfer
Journal
- Bills
of Material Journal
- Counting
Journals Setup
- Warehouse
Items
- Counting
groups
- Creating
and processing a counting journal
- Tag
counting Journal.
Transfer Orders, Inventory Closing
- Setup
for transfer orders
- Using
the Transfer orders form
- Picking
items for a transfer order
- Shipping
and receiving a transfer order.
Commission
- Commission
setup
- Commission
posting
- Commission
customer group and commission
- Item
Group, Commission sales group
- Commission
calculation
- Viewing
commission transactions
Inventory Closing
- The
fundamental Costing issue.
- Standard
Cost Price
- Estimated
Inventory values before closing.
- Packing
slip updates and inventory value
- Inventory
models used for closing.
- Inventory
and inventory closing
- Pre-
closing actions, Closing Inventory, Inventory recalculation.
- Manual
inventory adjustments
- Inventory
costing and adjusting reports.
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