Use deferrals in purchase invoices
Deferrals can be used with purchase invoices in Dynamics 365 Business Central. You can set up templates to simplify the process.
Set up a deferral template
To allocate a cost to a period other than the period in which the transaction was posted, you can use functionality to automatically defer costs over a specified schedule.
To distribute costs on the involved accounting periods, you can set up a deferral template for the resource, item, or G/L account that the cost will be posted for. When you post the related purchase document, the cost is deferred to the involved accounting periods, according to a deferral schedule that is governed by settings in the deferral template and the posting date.
To set up a deferral template, follow these steps:
Select the Search for Page icon in the top-right corner of the page, enter deferral templates, and then select the related link.
Select New.
Fill in the fields, as necessary.
In the Calc. Method field, specify how the Amount field for each period in the Deferral Schedule window is calculated. You can choose between the following options:
Straight-Line - The periodic deferral amounts are calculated according to the number of periods that are distributed according to period length.
Equal Per Period - The periodic deferral amounts are calculated according to the number of periods and are distributed evenly on periods.
Days Per Period - The periodic deferral amounts are calculated according to the number of days in the period.
User-Defined - The periodic deferral amounts are not calculated. You must manually fill in the Amount field for each period on the Deferral Schedule page.
The Start Date field specifies when to start calculating deferral amounts. You can choose between the following options:
Posting Date
Beginning of Period
End of Period
Beginning of Next Period
Beginning of Next Calendar Year
In the Period Desc. field, specify a description that will be shown on entries for the deferral posting. You can enter the following placeholder codes for typical values, which will be inserted automatically when the period description is displayed.
%1 - The day number of the period posting date
%2 - The week number of the period posting date
%3 - The month number of the period posting date
%4 - The month name of the period posting date
%5 - The accounting period name of the period posting date
%6 - The fiscal year of the period posting date
For example, assume that the posting date is 02/06/2022. If you enter Revenue deferred for %4 %6, then the displayed description will be Revenue deferred for February 2022.
Watch the following videos for a demonstration of how to use a deferral with a purchase order invoice. The first video shows how to set up a deferral template.
Now that you know how to create a deferral template, let’s have a look at how to use it in a purchase invoice.