Global Inventory Accounting Add-in for Dynamics 365 Supply Chain Management
Important
This content is archived and is not being updated. For the latest documentation, go to What's new or changed in Dynamics 365 Supply Chain Management. For the latest release plans, go to Dynamics 365 and Microsoft Power Platform release plans.
| Enabled for | Public preview | General availability |
|---|---|---|
| Users by admins, makers, or analysts | 
Jun 18, 2021 |
Apr 30, 2022 |
Business value
International organizations are under increasing pressure from authorities to comply with local and global accounting standards. The valuation of inventory plays a significant role in securing compliance. The Global Inventory Accounting Add-in for Dynamics 365 Supply Chain Management provides the ability to account inventory in multiple representations by applying the appropriate valuation method (standard cost, average, or specific identification) and the selected accounting currency per instance. Global Inventory Accounting enables organizations to report inventory statements and subledger accounting values (also known as the inventory balance and the cost of goods sold) in what is often referred to as dual valuation or dual currency.
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 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, organizations 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 that 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. Supported cost object policy options:
- Product
- Product – Site
- Product – Site – Warehouse
Supported input measurement basis policy options:
- Normal historical
- Standard
Supported cost flow assumption policy options:
- Average
- Specific identification (batch)
- Cost element policy
Supported recording interval:
- Perpetual
This solution provides a detailed audit trail, which ensures that you can track inventory accounting events and measurements all the way back to the original document posted in Supply Chain Management.
The solution leverages Power BI to provide insights and analytics. The shared asset library of Microsoft Dynamics 365 Lifecycle Services provides a specially designed Power BI template that you can download and embed into Supply Chain Management.