Global Inventory Accounting Add-in for Dynamics 365 Supply Chain Management


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Enabled for Public preview General availability
Users by admins, makers, or analysts Jun 18, 2021 -

Business value

This feature provides a comprehensive solution that enables organizations (especially international organizations) to perform inventory accounting using multiple costing ledgers, thereby enabling them to comply with multiple accounting standards and internal management accounting at the same time.

Feature details

Organizations, especially those with international operations, often prefer to account for inventory by standard cost as part of their management accounting setup. However, local governments, tax authorities, and the International Financial Reporting Standards Foundation (IFRS) typically don't recognize standard cost as an accounting principle, and often require average or specific identification. In addition, organizations often want to account inventory using both a local currency and the functional currency.

Collectively, these requirements must be addressed in a comprehensive solution that supports the ability to perform inventory accounting in multiple costing ledgers, where each ledger can be configured with a specific set of accounting policies.

With this new functionality, customers can define as many costing ledgers as required. Inventory accounting in dual currencies and in dual valuations are both supported.

Inventory accounting is performed in individual ledgers. Several costing ledgers can be created for each legal entity in an organization as needed, thereby ensuring that multiple inventory representations can be obtained. All documents (such as purchase orders, sales orders, transfer orders, and so on) posted in a legal entity will be accounted in all the costing ledgers associated with the legal entity.

A costing ledger is defined by:

  • Calendar
  • Currency
  • Exchange rate table
  • Convention

A convention is a collection of inventory accounting policies that can be associated to one or more ledgers. This provides the ability to share a common convention in the organization.

The Global Inventory Accounting Add-in supports multiple inventory accounting policies. For each policy, a single rule can be selected, and it applies to all products.

Cost object policy options:

  • Product
  • Product – Site
  • Product – Site – Warehouse

Input measurement basis policy options:

  • Normal historical
  • Standard

Cost flow assumption policy options:

  • Average
  • Specific identification (batch)
  • Cost element policy

Recording interval:

  • Perpetual

Lastly, this solution provides reports and a detailed audit trail that starts from an inventory accounting event or measurement and continues all the way back to the original document posted in Supply Chain Management.

See also

Global Inventory Accounting home page (docs)