Dynamics 365 For Operations Tip: Vendor Prepayments and Revenue Recognition for Fixed Price Projects

Hello, Good to be back here on the blog !!! Jumping straight into the topic here today about a new addition of a feature for vendor prepayments in relation with fixed price project revenue recognition !!

Issuing large amounts of prepayments to vendors is often a common business requirement for large scale, long-term fixed price projects, which involves a lot of sub-contracted work. Vendors often request prepayments for the subcontracting services they are contracted to deliver for these projects. These prepayments can sometimes be just a flat amount based on mutual decisions, or it can sometimes be a percentage of the total cost of the subcontracting service. There can be several months of gap between when the prepayments are issued and when the vendors actually deliver the services.

For such projects, customers usually recognize revenue on a percentage completion basis and need the ability to include these vendor prepayments in the project percentage completion calculation of the project for revenue recognition/revenue estimates calculations.

In this post, we will evaluate one of the new features of Dynamics 365 For Operations (Referred as D365 – Operations from here on), which allows us to consider these vendor prepayments automatically when running the monthly revenue recognition/estimates for fixed price projects for calculating the % completion of the project.

For this demonstration, I have setup a fixed price project and the associated contract already. This project is setup to recognize revenue on a % completion basis.

Contract Setup

Project Setup

The Project Manager has created and submitted the purchase requisition for approval so that the services can be procured from Rebar Supply Co. Ltd. See screenshot below.

PR Submitted

The purchase requisition gets approved by the designated manager and the Purchase order is automatically created. See screenshot below.

PR Approved

The Project procurement team/Project manager then sets up the prepayment details on the project purchase order that was automatically created upon approval of the requisition.

PrepaySetupOnPO

Finance and Accounting team now processes the prepayment invoice to initiate the prepayment to the vendor.

Prepay Invoice

Prepayment

Now that the finance team has processed the vendor prepayment for the subcontracting work, let us now go ahead and see what happens when they run the monthly revenue recognition process for this project.

Notice that system was able to consider the vendor prepayment cost for the project and was able to determine the percentage completion based on the total project budget/forecast defined. See screenshot below

PComp

When this revenue recognition entry is posted, the revenue amount (based on Percentage complete and the total contract value) will be posted to general ledger. We all know how it works from here 🙂

That’s it for today !!

Sandeep

Sandeep ChaudhurySandeep Chaudhury is a Dynamics 365 enthusiast with over 10 years of experience in functional consulting, Solutions architecture and systems integration, with expertise in the areas of Professional services automation(Project Management and accounting), Financials Management, Services Management, Sales and Marketing, Human resource management, Travel and Expenses Management and Procurement & Sourcing modules of Microsoft Dynamics 365 ERP. He has experience working with the Dynamics 365, AX 7, AX 2012 R3, AX 2012 R2, Dynamics 365 for Operations and more.

What is the Point of AXIO Core Financials with Dynamics 365 for Operations?

At first glance, it just doesn’t make sense that SBS Group (or anyone for that matter) would create a third-party solution to enhance financial management for one of the world’s most noted financial management solutions.  I’ve had several potential clients ask about this and my answer is always the same:  It is about helping our customers realize business value faster.

When a business invests in technology, they expect tangible results.  Whether they’re aspiring to enhance operational performance, improve the customer experience or capitalize on new opportunities, the goal is to provide genuine business value in the least amount of time.  The days of waiting for smart technologists to reverse engineer generalized solutions to the needs of individual companies over the course of months and years has been put to pasture by the advent of cloud computing.

We’ve implemented ERP solutions for thousands of companies and have learned a thing or two about the kind of configurations, enhancements and customizations that different types of buyers will need.  We put that knowledge to use with every engagement, and in the case of AXIO Core Financials, we start well in advance of the engagement.

After all, Microsoft did their part. They created Dynamics 365 for Operations which is arguably the most robust ERP platform on the market today.   It is an extremely flexible, scalable Cloud ERP platform that takes advantage of the entire Microsoft Office and server stack.  It is up to our team to bend, balance and bedazzle the solution so that it operates as if it were created exclusively for each customer…and to do it quickly and efficiently.

“Bedazzling Dynamics 365 for Operations” with AXIO Core Financials

So how exactly do you bedazzle financials?  Well, you begin by understanding who you’re bedazzling it for.  AXIO Core Financials is designed to help larger, enterprise-level organizations who require universal integration of finance across any number of countries, companies and other entities. We often work with professional services firms who have operations and projects around the world and distribution companies with complex ownership and revenue management structures.  Complex operations require special attention to the setup of even the most fundamental system components.  AXIO Core Financials includes:

  • Multi-company, multi-currency management.
  • Accounts Receivable
  • Accounts Payable
  • General Ledger
  • Fixed Assets
  • Procurement and Sourcing
  • Product, Inventory and Warehouse Management
  • Banking and Advanced Credit Management.
  • Regulatory support
  • Human Resource Management
  • Advanced commissions management.
  • Excel Budget Importing
  • Master Data Management Import Templates
  • Pre-Defined Business Process Flows w/ Swim-Lane Diagrams
  • On-Screen and In-App Task Guides
  • Content-Sensitive Help and Training Material

AXIO Core Financials enhances global scalability, compliance with GAAP, IFRS, Sarbanes-Oxley, and DCAA requirements and spans all the important back-office processes in your firm to give you unparalleled insight and control of all critical financial functions.

Sample Screen-Shot of Bank Management Workspace

AXIO Core Financials Bank Workspace with Dynamics 365 for Operations

Sample Screen-Shot of Credit and Collections Workspace

AXIO Core Financials Credit and Collection Workspace with Dynamics 365 for Operations

Faster Time to Value

By leveraging best practices and lessons learned over more than 30 years to create AXIO Core Financials, our team has been able to decrease the related Dynamics 365 for Operations implementation by an average 30-45%. And, our clients get a much-improved experience with fewer frustrations and confidence knowing that their solution has been vetted and approved by the Microsoft AppSource Team.

AXIO Core Financials on Microsoft AppSource

Learn more about AXIO Core Financials on our website or see it in Microsoft’s AppSource along with other SBS Group solutions like AXIO Professional Services for Project-Oriented firms.

Best regards,

Robbie Morrison
Chief Solution Strategist, SBS Group

About Robbie
Robbie Morrison has spent nearly 20 years helping customers build and deploy elegant technology and business solutions.  From start-ups to enterprise-class organizations worldwide, his knowledge of the Microsoft Dynamics ecosystem and products helps SBS Group customers maximize ROI on technology investments.  Robbie

Today, Robbie serves SBS Group customers in his role as Chief Solution Strategist where he provides thought leadership and manages the development of B2B solutions.  Robbie received his MBA from the University of Georgia, Terry College of Business.
https://www.linkedin.com/in/robbiemorrison

SBS Group to Host Microsoft Dynamics 365 for Operations Webcast for Professional Services Firms

The webcast will discuss the integration of SBS Group’s AXIO for Professional Services solution with Microsoft Dynamics 365 for Operations.

SBS Group, a leading information technology services and consulting firm, has announced they will be hosting a webcast focused on Microsoft’s new enterprise business solution, Dynamics 365 for Operations. The webcast will occur on Thursday, March 16 at 1 p.m. ET.

The webcast, entitled “Microsoft Dynamics 365 for Professional Services Firms,” will be centered on Dynamics 365 for Operations and its capabilities for professional services firms. SBS Group’s enterprise solution, AXIO for Professional Services, will be featured and demoed throughout the webcast. Attendees will learn about how SBS Group’s unique combination of industry experience and solution development makes them an ideal partner for professional services firms.

The presenters for the webcast are Robbie Morrison and Sandeep Chaudhury. Morrison is the recently named Chief Solution Strategist at SBS Group after previously leading the enterprise division. Chaudhury is a well-respected Senior Solutions Architect and Lead Functional Consultant for Dynamics AX and Dynamics 365 for Operations. Both presenters bring vast experience in ERP implementation and solution development as well as expertise in the professional services industry.

Registration for the webcast is free. To register, visit https://attendee.gotowebinar.com/register/8589357729067166465.

About SBS Group
SBS Group is a national Microsoft master VAR (Value Added Reseller) with Gold level competency in enterprise resource planning (ERP) and customer relationship management (CRM). Over the past 30 years, they have been recognized as Microsoft Partner of the Year, Inner Circle Member and Microsoft President’s Club member multiple times. The company is headquartered in Edison, New Jersey and operates offices across North America. For more information, please visit SBS Group’s website at http://www.sbsgroupusa.com. Follow us on LinkedIn at http://www.linkedin.com/company/sbs-group, on Twitter at http://www.twitter.com/sbsgroup and find us on Facebook at http://www.facebook.com/SBSGroupUSA.


To read the full release, click here.

Dynamics 365 for Operations in the Cloud and On-Premise : The Best of Both Worlds

Major news in the enterprise Dynamics community was broken last week. Microsoft Dynamics 365 for Operations is nearly ready for a hybrid deployment, meaning enterprise-level firms will be able to experience the best of both worlds. The hybrid cloud deployment allows enterprise firms, who could not consider a cloud-only solution, to receive the multitude of benefits of Microsoft cloud technology while still maintaining the security and control they need in order to run their firm.

Some enterprise level firms, specifically manufacturers and retailers, rely heavily on smooth and consistent production in order to make their business profitable. As such, these companies tend to lean towards ERP and business solutions that are held and controlled locally. Additionally, some of these companies are forced into these types of solutions because regulations maintain that they capture and store a customer’s personal information locally. A cloud-only solution gives them the operating power they need to produce, but not the control or security they desire. That is no longer the case for Microsoft Dynamics 365 for Operations.

Dynamics 365 for Operations Hybrid Cloud Announcement

In a blog post on February 23rd, Sri Srinivasan announced and detailed the availability of a hybrid deployment for Dynamics 365 for Operations. Srinivasan is the General Manager for Microsoft Dynamics 365 for Operations in the Cloud and Enterprise Group.

At the Summit ’16 in Tampa, Florida, we announced the plans for a hybrid cloud deployment meant to accommodate these specific scenarios, so that organizations can combine the best of both worlds. Dynamics 365 for Operations plans to enable organizations to run their business processes from application servers at the edges, meaning that transactions are supported by local application services and business data is stored locally. Each such facility running at the edge is called “My Workplace”. The central cloud node provides a single view of the business across distributed ”My Workplace” instances while utilizing the power of the Microsoft cloud for embedded intelligence in business processes.

Sri Srinivasan, Microsoft General Manager for Dynamics 365 for Operations in the Cloud and Enterprise Group

Sri Srinivasan, Microsoft General Manager for Dynamics 365 for Operations

The Microsoft cloud connection ensures data aggregation, financial reporting, intelligence, and more. The cloud instance also provides the local installation with data failover in the Microsoft cloud, automated deployment and continuous updates, and elastic compute capacity to infuse “intelligence” into the business process when needed. This hybrid cloud deployment model scales out through federation of the on-premises nodes (My Workplaces), federated in the Microsoft cloud for a single, global enterprise view, which is a first for business applications.  By Summer 2017, we will support a single “My Workplace”, followed by federation of “My Workplace” instances in releases beyond. We are excited to offer this deployment option, “cloud and edge”, a true differentiated option that combines the power of cloud and on-premises in a unique way to offer scale, continuity, and intelligence.

Sri Srinivasan, Microsoft General Manager for Dynamics 365 for Operations

This is fantastic news for enterprise firms looking to harness the power of the Microsoft Cloud while still being able to run certain processes locally. Srinivasan went on to divulge that there will be an ON and OFF switch of some sorts that will allow companies to control cloud synchronization – keeping them in control of their business data.

Deployment Options

With this new deployment method, enterprise firms will have a real decision to make when considering Microsoft Dynamics 365 for Operations. Do they want to take advantage of all the Microsoft Cloud has to offer? Or do they prefer to have a server nearby storing key information and running select processes? Even further, firms may want flexibility to change their ERP environment after the initial purchase without having to re-deploy a brand new ERP solution.

Here is what the Dynamics 365 for Operation team is working on at Microsoft:

  • New and existing customers will have paths forward to license both local business data and cloud and edge deployments. Existing investments will continue to be accounted for in our licensing.
  • Customers can license local business data deployments via a Dynamics 365 for Operations license with Software Assurance/Enhancement Plan or a subscription model.
  • Customers with active Microsoft Dynamics Enhancement Plans or Software Assurance, may upgrade to local business data as they remain entitled to access new versions and updates.
  • Transitions to Dynamics 365 cloud subscriptions are available to customers with active Microsoft Dynamics Enhancement Plans or Software Assurance.
  • Cloud and edge software and services will be licensed under the existing Dynamics 365 cloud subscription licensing model.

Dynamics 365 for Operations Deployment Options

Enterprise firms can select from three deployment options. The below photo examines the different scenarios and details of each deployment.

Dynamics 365 for Operations Deployment Scenarios

AXIO Enterprise Solutions for Dynamics 365

SBS Group’s AXIO Enterprise Solutions are both available on Microsoft AppSource for enterprise firms interested in optimizing and strengthening their Dynamics 365 for Operations deployment and solution. AXIO Core Financials spans all the important business processes in your firm (accounts receivable/payable, general ledger, fixed assets, banking, etc.) and is built directly on Dynamics 365 for Operations. AXIO for Professional Services gives businesses the same features as AXIO Core Financials plus several additional features needed specifically by professional services firms such as project and resource management, project accounting, government contracting and much more.

Both solutions are designed for companies who have multi-entity, multi-currency, multi-taxation and multi-language requirements. With direct integration with Dynamics 365 for Operations, AXIO Enterprise Solutions provide global scalability, enterprise-class extensibility, built-in intelligence, and compliance with all GAAP, IFRS, Sarbanes-Oxley, and DCAA requirements.

Register for our upcoming webcast and learn more about Dynamics 365 for Operations and AXIO Enterprise Solutions.

“Microsoft Dynamics 365 for Software Companies with AXIO for Professional Services”
Thursday, March 16th
1 PM – 2 PM ET

register for webcast

Best regards,

Robbie Morrison
VP Enterprise Solutions and Services, SBS Group

About Robbie
Robbie Morrison has spent nearly 20 years helping customers build and deploy elegant technology and business solutions.  From start-ups to enterprise-class organizations worldwide, his knowledge of the Microsoft Dynamics ecosystem helps SBS Group customers maximize benefits from the ERP investments.  Robbie

Today, Robbie serves SBS Group customers in his role as Vice President, Enterprise Group where he provides thought leadership and manages the enterprise delivery team.  Robbie received his MBA from the University of Georgia, Terry College of Business.
https://www.linkedin.com/in/robbiemorrison

SBS Group’s AXIO for Professional Services Now Available for Dynamics 365 for Operations on Microsoft AppSource

AXIO for Professional Services is one of the first solutions available specifically for professional services firms on AppSource for Microsoft Dynamics 365 for Operations.

axio-pro-servInformation technology innovator and leader, SBS Group, announced the availability of AXIO for Professional Services on Microsoft AppSource. This announcement comes after the release of Microsoft Dynamics 365 for Operations on November 1, 2016.

“Enterprise-level professional services firms have unique needs when searching for an ERP solution,” explains Robbie Morrison, Chief Solution Strategist. “Optimized for cloud deployment and mobile use, SBS Group’s AXIO for Professional Services addresses the needs of those firms while embracing Microsoft’s new vision for ERP.”

AXIO for Professional Services is a business software solution specifically built for companies with global needs such as multi-entity, multi-currency, multi-taxation and multi-language requirements. AXIO for Professional Services specifically focuses on the needs of professional services firms including revenue recognition, resource management, project management, marketing, human capital management and financial management. The solution provides global scalability and compliance with all GAAP, IFRS, Sarbanes-Oxley and DCAA requirements including the new ASC 606 and IFRS 15 revenue recognition standards.

AXIO for Professional Services is built on the flexible and comprehensive Microsoft Dynamics 365 for Operations platform, bringing enterprise-class extensibility and built-in intelligence. The user adoption process is smooth, and return on investment (ROI) is accelerated due to the rapid implementation approach and its native integration with Microsoft Dynamics 365. – Microsoft’s new approach to intelligent business applications.

To view AXIO for Professional Services on Microsoft AppSource, visit: https://appsource.microsoft.com/en-us/product/dynamics-365-for-operations/sbs-group.1aae5b60-0d79-4feb-b819-4adfbe17672f?tab=Overview.

About SBS Group
SBS Group is a national Microsoft master VAR (Value Added Reseller) with Gold level competency in enterprise resource planning (ERP) and customer relationship management (CRM). Over the past 30 years, they have been recognized as Microsoft Partner of the Year, Inner Circle Member and Microsoft President’s Club member multiple times. The company is headquartered in Edison, New Jersey and operates offices across North America. For more information, please visit SBS Group’s website at http://www.sbsgroupusa.com. Follow us on LinkedIn at http://www.linkedin.com/company/sbs-group, on Twitter at http://www.twitter.com/sbsgroup and find us on Facebook at http://www.facebook.com/SBSGroupUSA.


To read the full release, click here.

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