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RSM US LLP

Quick and Painless Month-End Close with Microsoft Dynamics AX 2012


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When I first visit a new client to kick off a Dynamics AX implementation, one of the first things I do is find out as much as I can about the organizations’ current business practices and talk to the staff at all levels about their expectations for the project.  Although I shouldn’t be, the result of these conversations is that I am continuously dually surprised at both the level of effort that a company puts into their month-end closing process and their low expectations for improving this timeline with their implementation of Microsoft Dynamics AX 2012.

I have in fact, scaled back the energy with which I relay to the accounting staff how much faster they will close the month with AX, as my claims were frequently met with so much skepticism that I thought I was losing credibility at the beginning of the project.  I realized that nobody could believe that so much of the effort they were doing could be incorporated into normal business processes and handled by the system.  Although it is true that my implementations often go from a 10-15 day close on a legacy system to 3-5 days on Dynamics AX 2012, my clients really do not believe it until they are in their “Test” environment, simulating their future month-end processes themselves.

By the nature of the fully integrated system, companies on Dynamics AX 2012 enjoy the luxury of always having their ledger and sub-ledger in balance for Inventory, Accounts Payables and Accounts Receivables.  Real-time financial reporting is provided throughout the month and allows reaction during the month.  Additionally, some one-time set-up items completely replace the need for any processing at month-end:

  • Recurring journal entries (reversing for accruals and non-reversing)
  • Consolidation companies for corporate roll-ups
  • Elimination companies to eliminate inter-company transactions.
  • Preloaded budget(s) and reforecast
  • Daily business processes that enforce doing “a day’s work in a day”

These items essentially leave the system in a state where it is up-to-date on a daily basis.  The close procedure is then limited to completing the last days’ business activities, completing a bank reconciliation, running a few reports to verify all applicable transactions are closed, restricting the proper modules from allowing further postings and the running, review, and adjustment of the financial statements.

I’m of the belief that because of the great architecture of Dynamics AX and the ability to configure the system to the reporting needs of the business, that you could close your period in just one day.  Although most organizations do not elect to achieve this in such a short period, Dynamics AX customers are always pleasantly surprised with the ease of the process.

Why is this important?  The simplest answer is that the accounting and finance staff at an organization contains some of the best and brightest the company has to offer.  By relieving these individuals of the need to do repetitive tasks, they are free to more frequently participate in strategic operational functions and discussions within the business.

Lastly, with quicker results comes the ability for the business to react and adapt to what is observed on daily and monthly financial statements.  In today’s fast moving world, it is simply not practical to expect to remain competitive when you are waiting 15 days to find out how you did the month beforehand.  Dynamics AX 2012 solves this.

By: John Hannan, RSM LLP - www.rsmus.com/dynamics

3 Responses to “Quick and Painless Month-End Close with Microsoft Dynamics AX 2012”

  1. Robin Ruleman says:

    Where do I find the Excel Add-In Upload Tool? it is part of the AX product? thank you.

  2. John Hannan says:

    Hi Terry,

    I understand what you would like to do. Although there is no functionality for setting up a journal entry and indicating to the system “automatically post this on the 1st of the month every month for 16 months”, there are 2 ways that you could do this with very minimal effort. I recommend both to customers, based on the posting and how likely it is to change month-to-month.

    1) Periodic Journals – You can create a periodic journal that will be available infinitely. This can include the account, dimensions, dollar amount and offset accounts. When you want to use this journal (i.e. on the first of each month), you simply call it from a general journal, enter the date (once) that you want to use for all the entries, and post.
    -> Note: I recommend this for entries, such as payroll, where the accounts/dimensions are pretty much the same month to month. You do get the opportunity to modify the amounts before posting if the dollar values change.

    2) Excel Add-In Upload Tool – Through the use of the (free) excel add-in tool that interfaces excel to Microsoft Dynamics AX2012, you can have an entry you keep in an excel file template format. You could open this file each month, make any changes needed, then “Publish” it to AX.
    ->Note: I recommend this when the number of lines will change monlthy, many accounts may be added or deleted, or the dimensions change.

    I hope this helps to answer your questions. If I can be of any assistance in explaining further, please let me know.

    Best regards,

    John

  3. Terry says:

    Hello, I see that you refer to Recurring Journal Entries. Are you speaking of Periodic Journals in AX 2012? Accrual Schemes? I am interested in knowing how to create recurring journal entries that automatically kick-off each month for a set # of months/periods. I am not clear on how to do this within AX.

    Thanks!
    Terry