Business Central Basic Finance Training
Table of Contents
System Setup
1) Company Information
2) General Master Tables
a. Payment Method
b. Payment Terms
c. Item Charge
3) Currencies and Exchange Rate
4) Dimensions
5) Chart of Accounts
6) Posting Groups
7) No. Series
8) Accounting Period
9) General Ledger Setup
10) Sales & Receivable Setup
4) Purchase & Payable Setup
5) Inventory Setup
6) Fixed Assets Setup
7) Marketing Setup
Master Setup
1) Customer
2) Vendor
3) Employee
4) Item
a. Create New Item
b. Inventory Type
c. Copy Item Function
d. Item Template
5) Bank Account
6) Fixed Assets
Analysis View
Account Schedule
1) Account Scheule Layout
2) Create Column Layout
3) Create Account Schedule
Finance Operation
1) General Journal
2) Account Receivable
3) Payment Journal
4) Recurring General journal
5) Reverse Entry
Pages
1) G/L REgister
2) General Ledger Entries
3) Customer Ledger Entries
4) Vendor Ledger Entries
5) Bank Ledger Entries
6) Reports
Month End & Year End Closing
1) Month End
2) Year end

System Setup

Company Information

General Master Tables

Payment Method

• Payment method code and payment method description
• Balance account – use for default settlement account.

Payment Terms

Due Date Calculation Formula
• D = Day(s)
• M = Month(s)
• CM = End of Current Month
Example:

For more information on date formula use in Business Central, please see Entering dates and times in Business Central - Business Central

Item Charge

i) Set up item charge for include the additional cost (e.g. Freight charge) to the inventory value.

• Item Charge No. and Item Charge Description
• Product Posting Group for the Item Charge
• General Posting Setup –
  • Purchase Account,
  • Purchase Credit Memo Account,
  • Direct Cost Applied Account

ii) Report – Item Charges -Specification
iii) Value Entries

For more information on Item Charge, please see https://docs.microsoft.com/en-us/dynamics365/business-central/payables-how-assign-item-charges

Currencies and Exchange Rate

To Create Currency

1. Go to Currencies List
2. Select New on Action Bar
3. Fill up the basic information as below.

• • Code
  • Description
  • Realized Gain Acc. 
  • Realized Losses Acc.

Set Exchange Rate

1. Go to Currencies List then select the currency you want to set the exchange rate.
2. Select Process, Exchange Rate on action bar.
3. System prompted the Currency Exchange Rate page
4. Click New action button for add new exchange rate for the currency.

Example: 1 HKD = 7.8 USD (Local Currency: HKD)

Dimensions

To create new Dimensions

1. Go to Dimensions List
2. In Edit List mode, enter the new dimension code into the last row or click new to add the new dimension.

To add Dimension Values for the Dimension

1. Go to Dimensions List
2. Select the Dimension that you want to add dimension values.
3. Select Dimension, Dimension Values in Action Bar
4. Enter the Dimension Value Code and Name

To set up the new dimensions as global or shortcut dimensions

1. Go to General Ledger Setup page to set up the global/shortcut dimension.

Important: Changing a global or shortcut dimension requires that all entries posted with the dimension are updated. To change a global dimension, use the Change Global Dimensions function, but it can be time-consuming and may affect performance and tables may be locked during the update. Therefore, choose your global and shortcut dimensions carefully so that you do not have to change them later.

Setup Default Dimensions for Customer, Vendor, Item and G/L Accounts

• Value Posting Options: Code Mandatory, Same Code, No Code

• If you want to make a dimension required but you do not want to assign a default value to the dimension, leave the Dimension Value Code field blank and then select Code Mandatory in the Value Posting field. Table below shows the example:

  Module	No.	Dimension	Dimension Value	Value Posting
  Customer	C00086	CUSTOMER	C00086	Same Code
  G/L Account	610600	COST CENTRE		Code Mandatory

  Chart of Accounts

Chart of Accounts List

• Use [Filter list by] to preview specific G/L account
• Use [Filter totals by] to filter the balance by Global Dimension or Specific Date
• Balance and Net Change
  • Balance is the total across accounting period.
  • Net Change is the total for date filter input in Filter totals by.

G/L Account Category / Account Sub-Category

• User can set up account category for generate the account schedule for financial statements.
• Top-level account category such as Assets, Liabilities, Equity, Income, COGS and Expenses are fixed. User can add or delete lower levels categories.
• G/L Account Categories List
  • • • Select Edit List action to add or edit G/L account category.
      • Select Indent / Outdent / Move Up / Move Down action for arrange the sub-category level.
      • Enter G/L Account No. in G/L Accounts in Category for setup the account directly.

To Create new G/L Account

1. Go to Chart of Accounts List than click [New] on the Action Bar.
2. Fill up the basic G/L Account information as below:

• • No
  • Name
  • Income/Balance
  • Account Category
  • Account Subcategory
  • Debit/Credit
  • Account Type
  • Totalling - fill up if the account type is End Total.
  • Direct Posting - unselect for sub-ledger account (eg AR, AP, Bank etc)
  • Default Dimension (if any)
    • Select action button Account/Dimensions if need to setup default dimension for the G/L Account

Posting Groups

1. 1. Mapping for Balance Sheet Account
      • Bank Account Posting Groups
      • Customer Posting Group
      • Vendor Posting Groups
      • Inventory Posting Setup - (Inventory Posting Group + Location)
   2. Mapping for Income Statement Account
      • General Posting Setup- (General Business Posting Groups + General Product Posting Groups)

No. Series

• • No. Series Code
  • No. Series Line
  • No. Series Relationships
  • Default / Manual No.
  • Sales & Receivable (Set Customer and Sales Document No. Series)
  • Purchase & Payable (Set Vendor and Purchase Document No. Series)
  • Inventory Setup (set Item and Inventory Document No. Series)
  • Marketing Setup (setup Contact No. Series)
  • Human Resources Setup (setup Employee No Series)
  • Journal Batch – setup no. series for the journal.

Accounting Period

1. 1. Create New Accounting Period
      • Only 12 period, will not have 13 periods for audit adjustment.
   2. General Ledger Setup
      • Allow Posting From & Allow Posting To
   3. User Setup
      • Allow Posting From & Allow Posting To per user

General Ledger Setup

General Ledger Setup

Actions
User can select action button in General Ledger Setup for conduct the following setup:

• Accounting Periods
• Dimensions
• User Setup
• Posting Group and Posting Setup

Sales & Receivable Setup

1. Discount Posting

Discount posting can be configured in Sales and Receivable set up with following options.
Case Example:

Sample Case entries:

1. Credit Warnings

Configuration for show the notification message when process the sales document.

1. Stock Warning

Specific if warning message shows for the sales quantity has not enough inventory quantity.

1. New configuration in Business Central

• Create Item from Item No.
• Copy Customer Name to Entries
• Ignore Updated Addresses

1. Number Series

Number series configuration for sales documents

Purchase & Payable Setup

1. Discount Posting

Same logic with Discount Posting setup in Sales & Receivable Setup.

1. New configuration in Business Central

• Create Item from Item No.
• Copy Vendor Name to Entries
• Ignore Updated Addresses

1. Number Series

Number series configuration for Purchase documents

Inventory Setup

1. New configuration in Business Central

• Skip Prompt to Create Item
• Copy Item Description to Entries

1. Numbering

• Number series configuration for Inventory Documents

Fixed Assets Setup

1. FA Location
2. FA Class
3. FA Subclass
4. Depreciation Book
5. FA Journal Setups – Action button in Depreciation Book Card.
6. FA Setup (Set FA No. Series)

Marketing Setup

1. Interaction – set up the business relation code.
2. Numbering – setup the number series for Contact Nos.

Master Setup

Customer

** Mandatory Field

1. 1. ### **{}No. (System Generates / Manual Input according to No. Series setup)
      1. Name
      2. Sell-to Address
      3. **{}Gen. Bus. Posting Group (determine Income Statement Accounts)
      4. **** Customer Posting Group (determine Balance Sheet Accounts)
      5. Currency (if blank = LCY)
      6. Payment Terms Code
      7. Shipment Method Code
      8. Default Dimensions
         • System auto default Customer No. as Same Code Dimension
      9. Ship-to Address

Vendor

** Mandatory Field

1. 1. 1. **{}No. (System Generates / Manual Input according to No. Series setup)
      2. Name
      3. Address
      4. **{}Gen. Bus. Posting Group (determine Income Statement Accounts)
      5. **** Vendor Posting Group (determine Balance Sheet Accounts)
      6. Currency (if blank = LCY)
      7. Payment Terms Code
      8. Location
      9. Shipment Method Code

Employee

Create Employee for record and reimburse employees' expenses in a similar way as of vendors.
Mandatory Field

1. 1. 1. **{}No. (System Generates / Manual Input according to No. Series setup)
      2. First Name
      3. Employee Posting Group (determine the Payable Accounts)

• To Record an employee's expenses – use general journal – see General Journal section
• To Reimburse an employee – use payment journal or Pay Employee Action

Note: Employee transactions can be posted in the local currency only. Reimbursement payments to employee do not support discounts and payment tolerances.

Item

Create New Item

** Mandatory Field

1. 1. 1. **{}No. (System Generates / Manual Input according to No. Series setup)

If number series is separate for different type of item, user can click the […]button next to No. field to select the appropriated no. series.

1. 1. 1. Description
      2. Description 2
      3. **{}Base Unit of Measure
      4. **{}Gen. Prod. Posting Group (determine Income Statement Accounts)
      5. **** Inventory Posting Group (determine Balance Sheet Accounts)
      6. **{}Type (Options: Inventory, Non-Inventory, Services)

Inventory Type

The Inventory type (i.e. "Type" in item card) involves full tracking of inventory quantity and value. Therefore, all item transaction types, and item handling features are supported.
The Service and Non-Inventory types do not involve tracking of inventory quantity and value. Only selected item transaction types and features are supported.

Copy Item Function

Open the item card which intended to make a copy then select Function => Copy Item in action bar.

Item Template

Setup template for fill up default value for different type of items.

Bank Account

** Mandatory Field

1. 1. 1. **{}No. (Manual Input)
      2. Description
      3. Currency (if blank = LCY)
      4. **{}Bank Account Posting Group (determine Income Statement Accounts)

Fixed Assets

** Mandatory Field

1. 1. 1. **{}No. (Manual Input)
      2. Description
      3. Depreciation Book Code
      4. **{}Posting Group
      5. Depreciation Method
      6. Depn. Starting Date
      7. No. of Depn. Years

Analysis View

Analysis View allow user to setup the analysis dimension for attach to Account Schedule or preview the report by Analysis View.

1. 1. Setup Analysis View – in Analysis View List, select New for add the Analysis View Card then enter the information's below:
      • Code and Name.
      • Account Source – select G/L Account.
      • Account Filter – enter the G/L Account that you want to see in the report. Lave blank if show all G/L account.
      • Dimension – enter the dimension that you want to see in the report. Max 4 dimension can be select in analysis view.
   2. Analysis by Dimensions – in Analysis View List, select Analysis by Dimensions.
      • Select the criteria in the page then click Show Matrix to preview the Analysis View.

Account Schedule

Account Scheule Layout

Account Schedules allow the financial users to create their own financial reports & statements.

1. 1. Column Layout – Determine how the numbers will be displayed in column, for example.
      • Multiple periods showing monthly columns.
      • Columns showing the period to date previous year/month and variance to current.
   2. Row Layout – The row it planned to show on report.

Create Column Layout

1. Create or edit column layout.
2. Select an account schedule and then select Process > Edit Column Layout Setup.
3. In the Name field, select an existing column layout or create a new one.
4. Sample for column layout.
   1. Compare amount with last month.
      • For compare the amount for current month and last month, enter "-1M" in Compare Date Formula column
      • For calculate the difference, enter the calculation in Formula column.

1. 1. Show the balance at date for each of twelve months by Period Formula.

1. 1. Show the balance at date for each of twelve months by Date Formula.

For more information on formulas, please see the details by the link below:
https://docs.microsoft.com/en-us/dynamics365/business-central/bi-how-work-account-schedule

Create Account Schedule

Create new account schedule.

1. Go to Account Schedule Page than Click [New [on the Action Bar

2. Fill up the Name and Description for the new account schedule.
3. Select the default column layout.
4. (Optional) Assign Analysis View for filter account schedule by Dimensions if needs.

Note: assign analysis view to account schedule for use the dimensions that are assigned to the analysis view. Otherwise, only two global dimensions in an account schedule can be use.

Copy Account Schedule

Select account schedule that you want to make a copy then select Process > Copy Account Schedule in action bar.

Filter account schedule by using dimension.

Steps for setup dimension filter in row.

1. Select an account schedule and then select Process > Edit Account Schedule.
2. Use the personalize function to add the column for Dimension.

• • Global Dimensions – column for Global dimensions is always available.
  • Other Dimensions – column for other dimensions only available if analysis view is assigned to the account schedule.

3. Select a line then enter the dimension value in the dimension column.

Steps for filter a column layout by dimension.

1. Select an account schedule and then select Process > Edit Column Layout Setup.
2. In the Name field, select an existing column layout or create a new one.
3. Use the personalize function to add the column for Dimension.
4. Select a line then enter the dimension value in the dimension column.

Finance Operation

General Journal

• Create New Batch and Assign No. Series / Select existing batch.
• Enter Entries

• Renumber Document No. => Actions/Functions
• Preview Posting => Actions/Posting
• Standard General Journal

Account Receivable

1. 1. Cash Receipt Journal

• Create New Batch and Assign No. Series / Select existing batch.
• Enter Entries
• Applies-to Doc. No. *System auto fill-in Amount on entry line.
• Apply multiple entries – select Process =>Apply Entries…
  1. Register Customer Payment
• Go to customer page, select customer, and then select Process > Register Customer Payments.
• Set up for select batch and balance account.

Payment Journal

1. 1. Payment Journal

• Create New Batch and Assign No. Series / Select existing batch.
• Enter Entries
• Applies-to Doc. No. *System auto fill-in Amount on entry line.
• Apply multiple entries – select Process =>Apply Entries…
  1. Pay Vendor
• Go to vendor page, select vendor, and then select Process > Pay Vendor.
• Select vendor ledger entries, and then select Process -> Create Payment.

Recurring General journal

1. 1. Recurring Method

      Balance	The balance of the account on the line is allocated among the accounts and dimensions specified for the line on the Allocation page. For example, the allocation of an expense account across departments.
      Fixed	Use when the journal amount is the same each period. The amount in the journal line remains unchanged after posting. For example, monthly fixed expenses such as rent.
      Variable	Use when the journal amount is different each period. The amount on the journal line is cleared to zero after posting. For example, monthly variable expenses such as salaries and wages.

   2. Recurring Frequency

Enter formula for determines how frequently the entry will be posted, for example, 1M with a posting date of 05/01/2021, after the journal is posted, the date changes to 06/01/2021.

1. 1. Document No

Business Central provides an option to enter formulas in the Document No. field to create a no. series for each posted entry instead of using the standard number series.
Simple text can be combined with the following text codes to form a no. series:
• %1 – current day number eg. posting on the 10th day of the month would return 10
• %2 – current week number eg. posting on the 5th week of the year would return 5
• %3 – current month number eg. posting in April would return 4
• %4 – current month name eg. a posting date of 01/04/21 would return April
• %5 – account period name (pulls from the accounting periods descriptions)
For example, if you want the document number for the current months rent journal to be RENTJANUARY then enter Rent%4 in the field.

1. 1. Description

The text codes can also be used in the Description field of the journal to enter a meaningful description eg. Rent Accrual %3/21 would become Rent Accrual 1/21 if the recurring journal was posted with a posting date in January 2021. Using these text codes saves having to manually update the document date and description each month on your recurring journals.

1. 1. Dimension

Enter dimension for the entry if needs.

Reverse Entry

1. 1. Reverse the general ledger entry.
      • Go to General Ledger Entries page then select the entry that you want to reverse.
      • Select Reverse Transaction action.
      • On the Reverse Transaction Entries page, select Reverse action.

Note: the entries cannot reverse if the realized gains/losses within the same transaction have been posted.

1. 1. Create a sales credit memo for reverse.
      • Open the posted sales invoice that you want to reverse then select Create Corrective Credit Memo action button.
      • In the credit memo, edit the information if needs, then select Apply Entries action button.
      • On the Apply Customer Entries page, select the line with he posted sales document that need to reverse then select Applies-To ID action button.
      • Post the credit memo for reverse the invoice.

Pages

G/L REgister

All double entries posted.

1. 1. Report – shows the related entries per register.
   2. Archive – preview the related entries on G/L Registers list

General Ledger Entries

All double entries posted.

1. 1. G/L Dimension Overview
   2. Reverse G/L Entries
   3. Change Posting Description
   4. Show change history for the entries

Customer Ledger Entries

Sub-ledger of all "Customer" Type Balance Sheet Entries.

1. 1. Accounts Receivable
   2. Received in Advance.
   3. Apply Entry
   4. Unapplied Entry

Vendor Ledger Entries

Sub-ledger of all "Vendor" Type Balance Sheet Entries.

1. 1. Accounts Payable
   2. Deposit Paid

Bank Ledger Entries

Sub-ledger of all "Bank" Type Balance Sheet Entries.

1. 1. If use Bank Reconciliation Function in system. Have indicator for validated bank entries.

Reports

• Account Schedule – Balance Sheet
• Account Schedule – Income Statement
• Trial Balance
• Customer Statement
• Customer Detailed Aging
• Customer – Summary Aging
• Aged Accounts Receivable
• Aged Accounts Payable
• Fixed Assets Book Value 01
• Inventory Valuation

*Select Explore All to preview all Business Standard Report for each functional area.

Month End & Year End Closing

Month End

1. Calculate Depreciation.
2. Post Recurring Journal.
3. Check all journal batches.
4. Bank Account Reconciliations
5. Exchange Rate Update
6. Adjust Exchange Rates
   • Enter Ending Date for exchange rate adjustment.
   • G/L entries for Currency Gain and Losses account to be generated.

Year end

1. 1. Check all Journals, Orders, Invoices section

Check all batches of General Journal, Payment Journal, Cash Receipt Journal, Purchase Journal, Item Journal, Phy. Inventory Journal, Recurring Journal, Sales Order, Sales Invoice, Purchase Order, Purchase Invoice etc., to ensure all entries of the current year is being posted.

1. 1. Close Accounting Period

Search "Accounting Period", then click "Close Year".Be aware that once the Accounting Period is being closed, it CANNOT be re-opened.

1. 1. Close Income Statement

Search "Close Income Statement"
Then fill in the required information.

• Financial Year Ending Date – Which is the closing date of your financial year
• Gen. Journal Template – Should always use GENERAL journal to book the year end closing entry
• Gen. Journal Batch – User can set up a new batch in General Journal, that only be used for year end closing

• Document No. – If user set no. series in the General Journal Batch, system will auto generate document no. However, if user wish to input Manual Document No., just leave the no. series field blank on the General Journal batch and manual input here
• Retained Earnings Acc. – Choose the Retained Earnings Account from the Chart of Account, in order for system to transfer P/L account figures for the year to Retained Earning Account.
• Close by Business Unit Code / Dimension / Inventory Period Closed  - These do not apply to your company, just leave these blank are fine.

After input the required fields, click "OK". Then a pop up screen will appear. User can then go back to the General Journal and check the Year End Closing Entry.

Then user should check the Year End Closing Entry generated by system. If the Entry is ok, click "Post".
After posting, all P/L accounts' balance will then transfer to Retained Earning Account.

1. 1. Create New Financial Year

Search "Account Period" and click "Create Year"

Input the required information, then click "OK".

Then a new financial year is created.

1. 1. No. Series

If the Company's No. Series are being set on a yearly basis, remember to create new set of No. Series for the new Financial Year.
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