MS Dynamics 365 for Finance and Operations (aka D365FO) offers a very strong financial functionality. A company can collect financial data in different dimensions. For example collecting data for overhead expenses and adding a cost center for every ledger entry.
D365FO allows setting default values for different master records like products, vendors, customers, and so on. As an example, a cost center can be set on all finished goods items and materials consumed. These values go to the ledger by default.
In this post, I will show you how the default values go to the ledger. I use D365FO batch order functionality to demonstrate how it works.
In a very general way, the flow of the dimension values for materials used for a batch order in production is shown on the image below.
A more detailed explanation follows below.
A base position available to set default financial values for materials consumed is a released product, which represents that material.
These values go to the formula on the batch order while the batch order is being created.
But this is not the entire story. As you can see on the image above, the values are not exactly the same as when the item was set. That’s because a merge happened with the values of the batch order. The priority is the batch order, so all values that were defined on the order overwrite the values from the material item.
In its turn, the values of the batch order are coming from the finished goods item selected for the order. This means that the values of the finished goods item overwrite the values of the material item.
Another place where default values can be set is the main account in the chart of accounts. That setup also affects the values used for ledger entry.
Theses formula dimension values are used for ledger entry posting types:
- Estimated cost of materials consumed, WIP
- Estimated cost of materials consumed
- Cost of materials consumed, WIP
- Cost of materials consumed
If you need to research the flow of dimension values in other parts of the system such as a purchase order, sales order, routes, and so on, please follow the advice.
On your test environment add a financial dimension to all main accounts and make it not obligatory. Then set default values for this dimension to different master records involved in the functionality you test (items, resources, costing sheet, and so on). You should name those values according to the name of records you set it for. For example, if you set the default financial value for finished good item, name that value as “Item – Finished good.” Then you need to process posting to the ledger and see the values used for posting. This will help you to understand which default values are sent to the ledger.
Finance function 