80219A_02

32
Chapter 2: Chart of Accounts Setup 2-1 CHAPTER 2: CHART OF ACCOUNTS SETUP Objectives The objectives are: Create, edit, close, or delete Main account categories. Create a new account in the Chart of Accounts (COA). Define main account information. Define administration information for the main chart of accounts. Define setup information for the main chart of accounts. Set up account structures. Set up advanced rules. Create a ledger. Set up accounts for automatic transactions. View inquiries and reports related to the Chart of Accounts. Introduction A Chart of Accounts is a set of main accounts tracked by Microsoft Dynamics AX ® . It captures financial information to make good financial decisions. Each account is assigned an account number as a unique identifier. Each main account contains the account structures used by the chart of accounts to define the valid combinations of main accounts and financial dimension values. The chart of accounts is shared and is a list of main accounts and account structures that define a chart of accounts in use by one or more ledgers. Additionally, different allocation terms can be set up for an account to distribute the amount to several accounts and account-dimension combinations, and system accounts help users handle automatic postings. The Chart of Accounts Setup course also shows all the reports and inquiries related to the Chart of Accounts.

Transcript of 80219A_02

Page 1: 80219A_02

Chapter 2: Chart of Accounts Setup

2-1

CHAPTER 2: CHART OF ACCOUNTS SETUP Objectives

The objectives are:

• Create, edit, close, or delete Main account categories. • Create a new account in the Chart of Accounts (COA). • Define main account information. • Define administration information for the main chart of accounts. • Define setup information for the main chart of accounts. • Set up account structures. • Set up advanced rules. • Create a ledger. • Set up accounts for automatic transactions. • View inquiries and reports related to the Chart of Accounts.

Introduction A Chart of Accounts is a set of main accounts tracked by Microsoft Dynamics AX®. It captures financial information to make good financial decisions. Each account is assigned an account number as a unique identifier.

Each main account contains the account structures used by the chart of accounts to define the valid combinations of main accounts and financial dimension values.

The chart of accounts is shared and is a list of main accounts and account structures that define a chart of accounts in use by one or more ledgers.

Additionally, different allocation terms can be set up for an account to distribute the amount to several accounts and account-dimension combinations, and system accounts help users handle automatic postings.

The Chart of Accounts Setup course also shows all the reports and inquiries related to the Chart of Accounts.

Page 2: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-2

Main Account Categories Main account categories can be used to better classify a general ledger account. Use main account categories primarily for grouping or selection of ledger accounts for Cubes and Key Performance Indicators (KPI's).

By default, over fifty ledger account categories are provided.

Scenario

Phyllis, the Accounting Manager, wants to include the Current Ratio on the Short-term solvency KPI report. Current Ratio is calculated by dividing a company’s current assets by current liabilities. Current assets typically consist of cash, cash equivalents, accounts receivable, inventory, and marketable securities. Current Liabilities consist of any liabilities that are payable within one year.

The following table shows the types of accounts defined in Contoso Entertainment USA:

Ledger account Account name

110100 Cash

130000 Accounts receivable

140000 Inventory

170000 Fixed Assets

To derive the Current Asset value, Phyllis must sum the values of the Cash, Accounts receivable, and Inventory accounts. Fixed Assets are not considered current assets. To perform this calculation, Phyllis uses the Main account category field. Main accounts later added to the chart of accounts will also use the Main account category to automatically be included in existing calculations.

Procedure: Create Main Account Categories

Perform the following steps to create a General Ledger Main Account category:

1. To access the Main account categories form, click General Ledger, click Setup, click Main accounts, and then click Main account categories.

2. Click the New button to create a new record. 3. Enter a unique name for the Main account category and a

Description.

Page 3: 80219A_02

Chapter 2: Chart of Accounts Setup

2-3

4. Select a Main account type to associate with the account category. The purpose of selecting a Main account type is to reduce the lookup of available Main account categories when you create a new Main account within the Chart of accounts form.

5. To link an account category to a main account, click the Link main accounts button. Or, link a Main account category to an account from the Main account details form. For more information, refer to "Create a New Account - Main Account Category."

FIGURE 2.1 MAIN ACCOUNT CATEGORIES FORM

Edit Main Account Categories

The Main account category, Description, and Main account Type assignment values can be changed at any time for user-defined and default Main Account Categories.

Close Main Account Categories

To inactivate a main account category, including any of the default main account categories, select the Closed check box in the Main account categories form. If you try to close a Main account category that is already linked to a main account, a warning message listing the linked main accounts is displayed. Select to continue or cancel.

After a Main account category is closed, it cannot be linked to main accounts.

Page 4: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-4

Delete Main Account Categories

A user-defined Main account category can be deleted, as long as it is not assigned for use with Purchase Requisitions in the Accounts Payable Parameters form.

None of the default Ledger account categories can be deleted.

Chart of Accounts The Chart of Accounts (COA) is the structured list of an organization's general ledger accounts. The COA will provide the main accounts for the COA plus the account structures in use for the COA. These structures determine the valid main account and financial dimension value combinations for the chart. Use the COA to do the following:

• Create and maintain main accounts • Set standard parameters • Define the terms of allocation

Plan the Chart of Accounts

To create the COA, users should list accounts that group well together and group kinds of revenues, costs, and balance accounts.

Before you create a company's Chart of Accounts, consider the following:

• What degree of specification is needed • How the Chart of Accounts must be structured • If external accountants offered any suggestions about the structure of

the Chart of Accounts

Make sure that there is sufficient space so that in the future, additional main accounts can be created between the existing main accounts. Decide whether operating accounts must come before balance accounts or the other way around.

Page 5: 80219A_02

Chapter 2: Chart of Accounts Setup

2-5

Multiple Chart of Accounts

It is common for large organizations to have the same chart of accounts used across multiple companies. It is possible to define company specific data, such as the default sales tax code on the main account. Also, the ability to inactivate financial dimension values for a specific company. The following entities/objects will have company specific data:

• Main account • Dimension values

The following elements make up the shared chart of accounts:

• Chart of accounts • Main accounts • Account structures • Advanced rules • Financial dimensions • Financial dimension values

Chart of Accounts Form

The Chart of Accounts form is where where the list of main accounts can be viewed as well as the account structures in use by the chart of accounts.

FIGURE 2.2 CHART OF ACCOUNTS FORM

Page 6: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-6

Procedure: Create a Chart of Accounts

Use the Chart of accounts form to create, manage, and view the organization’s chart of accounts. The chart of accounts also provides the main account and financial dimension value combination rules. The main accounts contain the financial data about the activity of the legal entity.

1. Click General ledger, then click Setup, then click Chart of accounts, and then click Chart of accounts.

2. Click the New button. 3. Enter the name and description in the Chart of Accounts and

Description fields, respectively. 4. In the Main account mask field, enter the structure that main

accounts must adhere to when they are created. This field is optional.

Procedure: Create Main Accounts

To create main accounts associated with a specific chart of accounts, click on the Main accounts FastTab and perform the following steps:

1. Click New to create a new line, click the New from template to use a template set up in the Main account templates form.

2. Enter an account number in the Main account field and enter an account Name.

3. Select either Chart of accounts or Companies in the Select the level of main account to display field.

Chart of accounts: Selecting this provides setup for the main account for the chart. It will be the shared setup.

Companies: Selecting this provides the means to override specific data at the company level, such as active from/active to dates. Also to set up company specific data such as default sales tax codes, default dimensions and financial statement formatting.

It does NOT select which company can use the main account.

Page 7: 80219A_02

Chapter 2: Chart of Accounts Setup

2-7

NOTE: Depending on the selection of the Select the level of the main account to display, specific fields in the Main accounts form are available.

FIGURE 2.3 MAIN ACCOUNTS

Main Account Information Select information specific to the main account, such as the main account category, debit and credit controls, and related accounts.

Procedure: Select Main Account Type

After the Main accounts header information has been established, click the General FastTab to enter detail information. The first level of detail consists of selecting a Main account type.

The following main account types determine how the account is used in the chart of accounts. You must select a main account type when creating the main account in the Main accounts form.

Select one of the following options to enter as the Main account type:

• Profit and loss, Revenue, and Expense – used as posting accounts. The profit and loss account is used for recording revenue and expenses. The sum of all operating accounts determines the year-end results. The revenue and the expense accounts have the same function as the profit and loss account. The balances for these main accounts are rolled into the year end result account during the Opening transactions process. Expense accounts are used by budgetary control.

Page 8: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-8

• Balance sheet, Asset, Liability, and Equity – used as transaction accounts that record the amounts that a company owns or owes. If you use asset, liability, and equity accounts, the accounts can have a higher degree of specification and you can more precisely structure reports about the company balance. The balances for these main accounts roll forward to the new year during the Opening transactions process.

• Total – use this to add account intervals. For example, frequently it is useful to make a total of a range of revenue accounts to obtain a quick overview of the total sales for the current period when you run a financial statement.

• Reporting – used for financial statement reporting. If you selected Reporting in the Type field, select how the account is used for reporting. You can select Header, Empty header, or Page header.

Procedure: Main Account Category

The Main account category field can be used to better classify a general ledger account, if the account type is Profit and loss, Revenue, Cost, Balance, Asset, or Liability. Ledger account categories are used primarily for grouping or selection of ledger accounts for business intelligence reporting, such as Key Performance Indicators (KPIs) or Microsoft SQL Reporting Services (SRS).

To set the Main account category field value, from the Chart of Accounts form, select a main account category from the drop-down list.

Procedure: Debit and Credit Considerations

Perform the following steps to enter additional information on the General FastTab.

1. Select if transactions in this account are usually debits or credits, in the DB/CR proposal list. This selection determines the result when you leave the Transaction text field in a transaction entry process. The pointer in the general journal is automatically positioned according to the choice. If the field is left blank, the debit is automatically proposed.

2. Select if an account is used only for debiting or for crediting in the DB/CR requirement list. If an account is limited to only debiting or crediting, the system checks this when it validates and posts the general journal. However, when the amount is a credit, a negative credit can still be entered.

3. In the Balance control list, select the balance control criterion for the transactions on the current account. For example, when transactions are entered in a journal for the account, if Debit control is selected, the system makes sure that total amount of the journal transactions do not make the balance for the account go into a credit.

Page 9: 80219A_02

Chapter 2: Chart of Accounts Setup

2-9

Procedure: Selecting Related Accounts

Perform the following steps below to associate related accounts with the main account:

1. In the Offset account field, select the default offset account for an account in the general journal. By creating a default offset account, you can settle certain costs from the same payment account without manually specifying the account every time.

2. In the Opening Account field, enter the account number to which the opening balance should be transferred. When you insert an account and then run the Opening transactions periodic job for a new fiscal year, the balance on the current account is transferred to the account that is specified in this field.

NOTE: Only select asset or liability accounts in this field because profit and loss, revenue, and cost accounts are set to zero when you create opening transactions.

3. The SRU code is used specifically for Sweden and is only available when the legal entity's address is in Sweden. If the entity is based in Sweden, enter the SRU code in this field.

Main Account Administration Information Select administration information specific to the main account.

Procedure: Allow Manual Entry

In order to have control when a main account may be used in a journal entry there have been administrative parameters added to the setup of a main account.

1. Select the Do not allow entry check box if a user should not be manually entering this account in a journal entry. By selecting this check box, users are prevented from entering a value for this account.

2. Select an Active from date and an Active to date to set up a time frame when the main account is available for transaction and journal entry.

3. Select the Suspended check box to prevent all postings to the selected main account. It is not possible to suspend an account that is assigned as a budget group account on another account.

Page 10: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-10

Closing Options

It is important to define closing processes for the main account and how balances are distributed at the time of closing.

In the Closing drop-down field, select how balances should be transferred to the closing sheet forms during the closing process.

• Blank – leave the field blank to transfer the balance to the Difference field.

• Result – select this option to update operating accounts. • Balance – select this option for balance accounts. • Capital – select this option for accounts related to cash flow

forecasts and revaluation.

Allocation Terms

Allocated transactions redistribute account balances from one account to one or more destination accounts or account-dimension combinations. The allocation feature is valuable when centrally administrated expenses must be distributed to, for example, individual cost centers.

Use allocation for realized and budget transactions. During allocation to the given accounts, the net amount is totaled. After allocation, any remainder relative to the journal line is posted to the original account with the original dimensions.

Scenario - Using Allocation Terms for a Main Account

When Susan, the order processor in the Contoso Entertainment USA (CEU) Company, posts a sales order, 10 percent of the revenue posted must be allocated as a royalty payment. To achieve this, Cassie, the Accountant, creates an allocation term so that every time there is a posting to the revenue account in question, 10 percent is allocated to the royalty account.

Procedure: Set Up Allocation Terms for a Main Account

Use the Allocation check box to automatically distribute a transaction amount to different accounts. This functionality is only available for the Companies view (Select the level of main account to display field ) in the Main accounts form. If you have a shared view of the chart of accounts, this option is not available. Perform the following steps to set up allocation terms for an account.

1. To access the Allocation form, click the Allocation check box in the Main accounts form and then click the Allocation Terms button.

2. In the Allocation percentage field, enter the percentage of the amount allocated to the specified account. The Percentage in total field checks that the allocation does not exceed 100 percent.

Page 11: 80219A_02

Chapter 2: Chart of Accounts Setup

2-11

Procedure: Select Allocation Criteria

Perform the following steps to select allocation criteria:

1. Expand the Source financial dimension criteria FastTab to select the financial dimension values to allocate from.

2. Expand the Destination ledger account FastTab to select the financial dimension values to allocate to.

3. Limit the allocation from the selected dimensions by using the drop down list for the Cost center, Department, and the Expense purposes. The system uses all lines where the dimension is empty or where it matches the given line. For example, in a journal entry where a given expense is shared evenly between two departments, set up an allocation term where any entry on the account allocates 50 percent between the two dimensions set up for expenses.

To copy an existing allocation profile from another account to the selected account click the Copy button.

Main Account Setup Information Set up currency, user, posting, and tax code validation information for each main account.

Create a New Main Account - Validation Options

There are four posting validation settings that can be defined for each account. Posting validation can be set for the following:

• Currency • User ID • Posting types • Sales tax (available if Companies is selected in the Select the level

of main account to display field)

Validation settings can be based on the following:

• Optional - the field is not validated at the time of posting. This is the default setting.

• To be filled in - the system verifies that the field is completed for posting. The value is not checked.

• Table - the system verifies that the field is completed for posting and that the value corresponds with the value specified in the account.

• List - the system verifies that the field is completed with one of the values that are defined on the Validation list button.

Page 12: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-12

Procedure: Create a New Main Account - Validate Currency

Perform the following steps to define currency information for a main account:

1. Click General Ledger, Common, Main accounts, click Main account on the Action Pane, then click the Setup FastTab.

2. In the Currency field, select the default currency that is displayed when a line in the general journal is assigned the selected main account. Depending on your selection in the Validate currency code field, a user can change the default currency on the journal line, if appropriate.

3. In the Validate currency code field, determine how the currency must be validated for posting. For more information, refer to "Create a New Main Account - Validation Options."

Procedure: Create a New Account - Validate User

Perform the following steps to specify authorized users for posting:

1. In the User ID list, specify the user who is authorized to post to this account. The Validate user field determines how User ID must be validated for posting.

2. In the Validate user field, determine how User ID must be validated for posting. For more information, refer to "Create a New Main Account - Validation Options."

Procedure: Create a New Account - Validate Posting

Perform the following steps to set posting validation for a main account:

1. In the Posting type field, determine the posting types allowed for the current account to make sure that only the defined posting types are accepted.

2. In the Validate posting field, determine how posting must be validated. For more information, refer to "Create a New Main Account - Validation Options."

Configuring Account Structures Account structures consist of main accounts and can include financial dimension segments. The account structures are used to define the valid combinations, which together with the main accounts, form a chart of accounts. The account structures allow you to define the sequence for the entry of the main account and financial dimension.

Page 13: 80219A_02

Chapter 2: Chart of Accounts Setup

2-13

NOTE: It is not required that the main account be the first segment in the account structure. However, it is required to be a segment in the account structure.

Multiple account structures allow a company to track information for specific accounts while not affecting other accounts. For example, balance sheet accounts may not require as many financial dimensions as profit and loss type accounts. For balance sheet accounts, you might only be interested in Department. For profit and loss accounts, you might also want to track Cost Center, Purpose, and Region.

Procedure: Configure Account Structures

Perform the following steps to configure account structures:

1. Open General ledger, click Chart of accounts, and then Configure account structures.

2. Click the New button to create a new record. 3. Click Add segment to add financial dimension to the structure from

the list. 4. Click Validate to check if you created a valid combination of

financial dimensions. 5. Click Activate once the validation is complete. 6. Save the record and close the form.

Page 14: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-14

NOTE: This form can also be accessed from the Chart of accounts form.

FIGURE 2.4 CONFIGURE MAIN ACCOUNTS

Advanced Rules Advanced rules link a financial dimension or multiple financial dimensions to an account number or range of account numbers so additional information can be gathered for reporting and analysis.

Advance rule structures provide the financial dimension combinations that are valid for the advanced rule.

For example, you want to track the travel expense account by the airlines. You could set up "Travel Expense" as the main account and create another financial dimension called "Airlines" and set criteria for that financial dimension such as "Airline 1", "Airline 2", and "Airline 3". Now, you can easily track travel expense by each airline defined.

Page 15: 80219A_02

Chapter 2: Chart of Accounts Setup

2-15

Scenario: Create Advanced Rules

Phyllis, the Accounting Manager, is setting up the charts of accounts for Contoso Enterprise. For some of the accounts, the organization wants to track additional information that is not captured in the account structures. She needs to ensure that for the customer group (one of the financial dimensions)"80: Other customers" that only certain departments can be used.

Procedure: Create Advanced Rule Structures

Perform the following steps to create an advanced rule:

1. Open General ledger, click Setup, click Chart of accounts, and select Advanced rule structures.

2. Click New to create a new record. 3. Enter a unique identifier for the Advanced rule structure, enter a

brief description, and then click OK. 4. Click Add segment to add financial dimension to the structure from. 5. Select the desired Financial dimension from the list and then click

Add segment. 6. Click the Filter icon under the selected segment to define which

values for the financial dimension are applicable for the selected rule.

7. Select the Specify which values are allowed option. 8. Click in the Enter a value field and then enter the desired value. 9. Optionally, select the Allow blanks check box to allow blank values

for the segment in the advanced rule you are defining. 10. Click OK to save and close the form. 11. Click Add segment to add another financial dimension to the

structure. 12. Select the next desired financial dimension from the list and then

click Add segment. 13. Click the Filter icon under the new segment to define which values

for the financial dimension are applicable for the selected rule. 14. Select the Specify which values are allowed option. 15. Click in the Enter a value field and then enter the desired value.

Page 16: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-16

16. Optionally, select the Allow blanks check box to allow blank values for the segment in the advanced rule you are defining.

17. Click OK to save and close the form. 18. Click Activate to save the changes and make them effective in the

ledger.

FIGURE 2.5 ADVANCE RULES

Procedure: Create Advance Rules

Perform the following steps to create advanced rules:

1. Click General ledger > Setup > Chart of accounts > Configure account structures.

2. Select the account structure to apply the advanced rule. 3. On the Action Pane, in the Setup group, click Advanced rule. 4. Click New.

NOTE: To add or edit advanced rules for an account structure, the account structure must be in a draft status. If the account structure is active, and you select to create a new advanced rule or edit an existing advanced rule, you will receive a message and can change the status of the account structure from active to draft.

5. Enter an Advanced rule ID and Name, and click OK. 6. Click the Add filter button to add criteria, and then select the

appropriate options to create the criteria. You might have to scroll down to view all of the criteria.

7. On the Advanced rule structures FastTab, click Add. Select the advanced rule structure to use when the advanced rule is in use.

8. Only active advanced rule structures are displayed. 9. To activate the advanced rule, you must activate the account

structure by clicking Activate on the Action Pane in the Configure account structures form.

Page 17: 80219A_02

Chapter 2: Chart of Accounts Setup

2-17

Ledger Setup The term ledger is used as a system for classifying transactions for the general ledger using a chart of accounts, a fiscal calendar, and one or more currencies.

Creating multiple ledgers will provide a ledger for each legal entity which provides the chart of accounts, accounting currency, reporting currency and fiscal calendar for the legal entity. The ledger also provides the means for sharing the chart of accounts, currencies and fiscal calendar by multiple legal entities.

Each legal entity will have a separate ledger and it is possible to have multiple ledgers for each legal entity.

Procedure: Create a Ledger Account Alias

Use the Ledger account alias form to create or update ledger account aliases. Go to General ledger, click Setup, click Chart of accounts, and then click Ledger account alias.

1. In the Leger account alias field, enter unique name. 2. In the Type field, select the type of ledger account alias. If you select

Shared, the ledger account alias will be available for all users. If you select User group or User, the ledger account alias will be available only for the user or user group selected in the User group or User field.

3. Select the account structure for the ledger account alias. 4. Select the Company for the alias to be used in.

Page 18: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-18

5. Select the values that will be displayed when the ledger account alias is entered in a ledger account definition field.

6. Select the dimension that will be selected when you enter this ledger account alias for a ledger account in the Initial focus field.

FIGURE 2.6 LEDGER ACCOUNT ALIAS FORM

Scenario - Create Ledgers

CEU has recently acquired a waste management company in Canada called Waste Management Group (WMG) for the purpose of proper disposal of all wastes as a result of plant manufacturing processes.

WMG uses the same chart of accounts and calendar as CEU. WMG and CEU use different local currencies as CEU uses the USD currency and WMG uses the CAD currency.

As such, a secondary currency (of USD) is added because WMG’s ledger currency does not match the functional currency of CEU parent entity, and this secondary currency is required for consolidated reporting purposes.

Because payments to suppliers and other trade partners is restricted to this ledger (Example - payment transactions will not be allowed from other ledgers WMG may establish), Phyllis must indicate this when creating the ledger.

Scenario - Add Business Entity

To add the newly acquired business into the CES (Contoso Entertainment Systems) organization structure follow these steps:

1. Phyllis logs into WMG. 2. Phyllis navigates to the Ledger form (General ledger > Setup >

Ledger). 3. She creates a new Ledger by clicking File > New. 4. She enters/selects the following ledger attributes:

o Name: enters Waste Management Group Canada o Description: enters Corporate ledger

Page 19: 80219A_02

Chapter 2: Chart of Accounts Setup

2-19

o Financial Calendar: selects Fiscal Year o Accounting Currency: selects CAD o Reporting Currency: selects USD

5. She enters the main accounts for posting. 6. She closes the form.

Procedure: Create a Ledger Group

To group multiple ledgers into a ledger group for ease of use in process management and reporting follow these steps:

Click General ledger > Setup > Sales Tax > Posting Groups.

Use this form to set up the ledger posting groups for sales taxes. The ledger posting groups are attached to individual sales tax codes, and the ledger posting groups determine the ledger accounts that the calculated sales taxes are posted to.

Procedure: Ledger Calendars

The ledger calendar uses the details set up in fiscal calendars. To view details for the fiscal calendar that was selected in the Ledger form, and view details for fiscal years that are part of that fiscal calendar follow these steps:

1. Click General ledger > Setup > Ledger. 2. Click the Ledger calendar button.

Page 20: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-20

3. Select a fiscal year in the left pane. The details for the selected year are displayed in the right pane.

4. Use the fields on this form to view period information and change the status of the periods, and to select which users can post accounting transactions to specific periods.

FIGURE 2.7 LEDGER CALENDAR

Procedure: Setting Period Statuses

To view and control the period status, follow these steps:

1. Click General ledger, click Setup, and then click Ledger. 2. Select the calendar from the drop down menu in the Fiscal Calendar

field 3. Click Ledger calendar on the top left corner of the form and it will

open the desired calendar 4. Expand the calendar tree in the navigation pane and click on the

desired period 5. Use the drop down menu under the Period status field to set the

period status.

Status - The three available statuses include:

• Open - Accounting transactions can be recorded in this period • On hold - Accounting transactions cannot be recorded in the period.

This status may be changed to Open or Closed. • Closed - Accounting transactions cannot be recorded in the period. If

a period has a status of Open, you cannot select Closed unless the previous period also has a status of closed.

NOTE: A closed period cannot be re opened or put it on hold.

Page 21: 80219A_02

Chapter 2: Chart of Accounts Setup

2-21

NOTE: When a fiscal year is being closed, you can select the Set fiscal year status to closed check box in the General ledger parameters form. This sets all periods in a fiscal year to a Closed status. You can also select the Check journalizing check box in the General ledger parameters form if you want to verify whether periods are journalized before they are put on hold or closed

Procedure: Select Authorized Users

Follow these steps to select the users who are authorized to post transactions in a specific AX module.

1. Click General ledger, click Setup, and then click Ledger. 2. Select the calendar from the drop down menu in the Fiscal Calendar

field 3. Click Ledger calendar on the top left corner of the form and it will

open the desired calendar 4. Expand the calendar tree in the navigation pane and click on the

desired period 5. Click on the Module access level tab to expand the access level

detail. 6. Highlight the line item of the Module Name you wish to grant

access. 7. In the Access field select All, None, or User Group

All - All users are authorized to update in the module in the selected period.

None - No users are authorized to update in this module in the selected period. For example, if a company wants to make some adjustments to a period, the modules that will not be adjusted are set to None.

User group - Specific user groups are authorized to updates in the selected period. In the Module user group area, specify the user group that can make changes, when the module status is set to User group.

Recalculate Calendars

Use the Recalculate ledger periods form to validate the ledger period in the general journal. If the ledger period has been modified for the ledger, the reference to the ledger period will be updated in the general journal. A message will be displayed and you will need to update the closing transactions using the Close form.

To recalculate ledger periods follow these steps:

1. Click General ledger > Setup > Ledger. 2. Click the Recalculate ledger periods button.

Page 22: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-22

Lab 2.1 - Enter a Main Account Scenario

Ken is the Controller at Contoso Entertainment USA (CEU). CEU pays rent for a leased building two times a year. The prepaid rent is an asset for CEU. The following table provides additional information.

Option Value

Main account 131150

Name Prepaid Rent

Main account category Prepaid Expenses

Currency USD

Challenge Yourself!

Use the table information to create a new Main account.

Need a Little Help?

1. In the Main accounts form, create the new account 131150, Prepaid rent.

2. In the Main account type field, use the arrow to select Balance sheet.

3. In the Main account category field, use the arrow to select PREPAIDEXP for Prepaid Expenses.

4. On the Setup FastTab in the Currency field, click the arrow to select USD.

Step by Step

1. Click General Ledger, click Common, and then click Main accounts.

2. In the New group on the Action Pane, click Main account. 3. In the Main account field, enter 131150. 4. In the Name field, enter Prepaid rent. 5. In the Main Account type field, use the arrow to select Balance

sheet. 6. In the Main account category field, use the arrow to select

PREPAIDEXP for Prepaid Expenses. 7. Expand the Setup FastTab. 8. In the Currency field, click the arrow to select USD. 9. Click Close to close the form.

Page 23: 80219A_02

Chapter 2: Chart of Accounts Setup

2-23

Lab 2.2 - Account Allocation Terms Scenario

At Contoso Entertainment USA (CEU), entries posted to account 600200, Repairs and Maintenance Expense, must be allocated between departments based on dimensions, Allocate 50 percent from the Administration department to the Professional Services department.

Challenge Yourself!

Use the information in the scenario to enter the allocation terms for account 600200.

Need a Little Help?

1. Open the Main accounts form. 2. After locating account 600200, Repair and Maintenance Expense,

open the Allocation rules form by clicking the Allocation terms button.

3. Set the Allocation rules terms according to the information in the scenario.

Step by Step

1. On the Navigation Pane, click General Ledger, click Common, and then click Main accounts.

2. Double-click on the Main account 600200 in the Main accounts list page.

3. Click the Edit button. 4. In the Select level of main accounts to display field, select

Companies. 5. Click the Legal entity icon and select CEU. 6. Expand the General FastTab and select the Allocation check box. 7. Click the Allocation terms button. 8. In the Percentage field enter 50.00 9. On the Source Dimension FastTab, In the Department field, select

Specific, and then use the arrow to select OU_4569 (Administration). 10. In the To account field select 600200. 11. On the Destination ledger account FastTab, In the Department

drop down list, use the arrow to select OU_2562 (Professional Services).

12. Close the Allocation form.

Page 24: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-24

Accounts for Automatic Transactions The modules in Microsoft DynamicsAX are highly integrated and many postings are handled automatically. For example, when an invoice is posted where a discount is given, this amount is posted automatically to an account for discounts. The appropriate account for that kind of posting must be set up, through system accounts.

In the Accounts for automatic transactions form consider the following:

• Specify the main accounts for automatic transactions that cannot be set up elsewhere in Microsoft DynamicsAX.

• There are other automatic accounts set up in each module, for example, posting profiles in the Accounts Receivable and Accounts Payable modules.

• The posting set up is discussed when each module is introduced.

Create Accounts for Automatic Transactions

Perform the following steps to set up automatic transaction accounts:

1. Click General ledger, click Setup, click Posting, and then click Accounts for automatic transactions.

2. Click Create and the system automatically creates the most common system account types when you set up the system accounts for the first time. The following is a list of examples of Accounts for automatic transaction Microsoft Dynamics AX creates when you click the Create button: o Penny difference in reporting currency o Error account o Penny difference in accounting currency o Year-end result o Cash discount o Balance account for consolidation differences o Customer cash discount o Customer invoice discount

Page 25: 80219A_02

Chapter 2: Chart of Accounts Setup

2-25

o Vendor cash discount Vendor invoice discount o Order, freight o Order fee

FIGURE 2.8 ACCOUNTS FOR AUTOMATIC TRANSACTIONS FORMo Order invoice rounding o Purchase invoice rounding-off o Purchase, fixed receipt price profit

NOTE: The Error Account, Penny Difference, and Year-end Result accounts for automatic transactions are mandatory. The other accounts for automatic transaction are set up depending on whether that functionality is used. If a service pack is installed, new accounts for automatic transactions may be introduced. Click the Create button after you install a service pack to make sure you have all the latest default account types.

3. Click New to create a new account for automatic transactions, if accounts are already created.

4. Attach the relevant main account for each account for automatic transactions in the Main account field. The name of the main account is automatically inserted in the Name field.

NOTE: To interrupt updates with an error message when the error account is used in the posting process, select the Interrupt in case of error account check box in the General ledger parameters form.

Page 26: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-26

NOTE: To register or manually change a cash discount in the settlement process, a cash discount system account must be set up.

To offer a discount on the total invoice amount, a customer invoice discount, vendor invoice discount, or both must be set up.

Inquiries and Reports Related to the Chart of Accounts This lesson describes standard inquiries and reports and the relationship to the Chart of Accounts.

Print the Chart of Accounts

The Chart of Account report displays a list of all accounts in the Chart of Accounts.

To print the Chart of Accounts report, click General Ledger, click Reports, click Base Data, and then click Chart of Accounts.

Audit Trail Inquiry

Consider the following when using audit trail inquiry:

• Each ledger transaction is part of a voucher. • When a voucher or group of vouchers is posted, the program creates

an audit trail entry with a unique numeric identifier. The entry includes an automatically generated transaction text that identifies the origin of the entry.

• Click the Voucher button to view the vouchers that are contained in the audit trail entry. The entry also includes references to the user who created the entry and to the entry date and time.

Page 27: 80219A_02

Chapter 2: Chart of Accounts Setup

2-27

To access the Audit Trail form, click General Ledger, click Inquiries, and then click Audit Trail.

If a journal that consists of several vouchers is posted, only one line is created in the audit trail. Check the specific vouchers by clicking the transactions button.

FIGURE 2.9 VOUCHER INQUIRY

View Account Transactions

When you view account transactions, consider the following:

• You can use the Ledger transaction list to view a list of all posted transactions on the current account.

• The entries result from posting transactions in: o Journals o Sales and purchase orders o Any other modules that post to ledger

• The information in the fields in the ledger transactions cannot be modified.

• To correct an entry, make a transfer which then appears in the form.

To open the Account Transactions form, click General Ledger, click Reports, click Transactions, and then click Ledger transaction List.

View Account Balances

To view a quick inquiry of ledger account balances in the system use the Balance list. To open the Balance list, click General Ledger, click Reports, click and then click Balance list. It is also possible to view balances from the Main account list page and the Trial balance list page.

Page 28: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-28

Summary This course, Chart of Accounts Setup, covers the basic information about the Chart of Accounts, Advanced Rules, Account Allocation Terms, Accounts for Automatic Transactions, and inquiries and reports related to these topics. The Chart of Accounts, the central collection location for daily financial transactions, is the base of the General Ledger module. It provides information about a company's financial state.

Allocated transactions redistribute main account balances from one main account to another destination main account. This is practical and can be used to set up automatic posting of, for example, percentage allocation of main account postings.

Page 29: 80219A_02

Chapter 2: Chart of Accounts Setup

2-29

Test Your Knowledge Test your knowledge with the following questions.

1. Is it possible to have the same chart of accounts used across multiple companies?

( ) Yes ( ) No

2. Before creating a company's Chart of Accounts, what considerations should be discussed?

3. Is the purpose of account allocation to use for realized transactions and budget transactions?

( ) Yes ( ) No

4. Can using posting types reduce the risk of selecting a wrong account when you set up posting profiles?

( ) Yes ( ) No

Page 30: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-30

5. Which of the following system accounts are required to be set up? (Select all that apply)

( ) Error account ( ) Cash difference ( ) Year-end result ( ) Penny difference

6. Which tasks are completed from the Chart of Accounts in Microsoft Dynamics AX? (Select all that apply)

( ) Create accounts ( ) Set standard parameters ( ) Access transactions ( ) View a company's financial state

Page 31: 80219A_02

Chapter 2: Chart of Accounts Setup

2-31

Quick Interaction: Lessons Learned Take a moment and write down three key points you have learned from this chapter

1.

2.

3.

Page 32: 80219A_02

Financials I in Microsoft Dynamics® AX 2012

2-32

Solutions Test Your Knowledge

1. Is it possible to have the same chart of accounts used across multiple companies?

(•) Yes ( ) No

2. Before creating a company's Chart of Accounts, what considerations should be discussed?

MODEL ANSWER:

-What degree of specification is needed -How the Chart of Accounts must be structured -If external accountants offered any suggestions about the structure of the Chart of Accounts

3. Is the purpose of account allocation to use for realized transactions and budget transactions?

(•) Yes ( ) No

4. Can using posting types reduce the risk of selecting a wrong account when you set up posting profiles?

(•) Yes ( ) No

5. Which of the following system accounts are required to be set up? (Select all that apply)

(√) Error account ( ) Cash difference (√) Year-end result (√) Penny difference

6. Which tasks are completed from the Chart of Accounts in Microsoft Dynamics AX? (Select all that apply)

(√) Create accounts (√) Set standard parameters (√) Access transactions (√) View a company's financial state