Closing Best Practices: Dynamics SL – Purchasing and AP Modules

This is Part 2 in a five-part series for Microsoft Dynamics SL year-end closing best practices. (Click here for Part 1) Below you’ll find the year-end closing for the Purchasing and Accounts Payable Modules in Dynamics SL, with checklists and other detailed information.

The series covers the following:

• Part 1: Dynamics SL – Inventory Module
• Part 2: Dynamics SL – Purchasing and Accounts Payable Modules
• Part 3: Dynamics SL – Flexible Billings, Order Management and Accounts Receivable Modules
• Part 4: Dynamics SL – Project Controller Module
• Part 5: Dynamics SL – General Ledger Module
  
  

Note: Year end is a good time for IT Support to test the Dynamics SL Database Backups to make sure they work. You don’t want to discover the backups are not working when you need them. After testing, perform backups of the Application and System databases prior to starting the year-end closing process.

Year-end Closing for Purchasing and Accounts Payable Modules

Closing Accounts Payable includes reviewing Accounts Payable data along with Purchasing and the preparation for generating the 1099s. We will begin with the review of the Purchasing Module because the close of Accounts Payable also closes Purchasing.

Purchasing Checklist

Here are reports and inquiries to assist with the Purchasing review process:

• Review Open Purchase Orders:
  • Purchase Order/Status/History Report (04.630.00): To review open Purchase Orders.
  • PO Receipts Inquiry (04.200.00): This screen assists in researching.
  • Purchase Orders (04.250.00): This screen will allow the user to manually update a Purchase Order to “completed” or “cancelled” if needed.
• Review Un-Vouchered Receipts:
  • Receipts Register Report (04.650.00)
  • PO Receipts Inquiry screen (04.200.00)
• Review Purchasing Batches:
  • Review the PO Receipts Batch Report (04.090.00) for unreleased batches. To locate unreleased or unposted batches create a filter using the “Select” tab as follows:
    • Batch.Status
    • in
    • H, B, S, U
  • Review and resolve any batches.
  • Generate and print reports after corrections are processed.

The Purchasing Module will close when the Accounts Payable Module is closed.

Accounts Payable Checklist

Steps to confirm all documents for the year have been entered:

1. Print/review the AP Batch Register Report-Summary (03.800.00) to verify there are no open batches for the periods 01 through 12. Research and resolve any unprocessed batches.
2. Post the AP batches in the General Ledger > Post Transactions screen (01.520.00).
3. Print/review the Vendor Trial Balance Report (03.650.00) and General Ledger Trial Balance Report (01.610.00) for the Accounts Payable accounts. If the numbers equal, you are ready to close the Accounts Payable Module for the year.

If the Vendor Trial Balance Report and the General Ledger Trial Balance Report for the Accounts Payable accounts do not agree, here’s what you can do:

1. Review the beginning Accounts Payable balance on the General Ledger Trial Balance Report (01.610.00) for the year and compare it to the ending account balance in last year’s General Ledger Trial Balance Report to confirm no entries were processed to prior years.
2. Review the Accounts Payable Accounts/Subaccounts in the Detail General Ledger Report (01.620.00) to determine if any Accounts Payable Transactions did not originate from the Accounts Payable Module. You will want to search for transactions where the Journal Type is not equal to “AP.”
3. Review the General Ledger > GL Transactions – Unposted Report (01.680.00) to confirm no transactions for the current or future periods exist which could affect the General Ledger or Vendor balances.
4. Review the Account Distribution Report (03.690.00) to confirm the Accounts Payable Default Account was properly debited for Debit Adjustments and Checks and properly credited for AP Vouchers and Credit Adjustments. Review the coding on any AP Void Checks.
5. Review the AP Transactions Report (03.640.00) for any questionable batches as a result of reviewing reports.
6. Reprint/review the Vendor Trial Balance and the General Ledger Trial Balance reports if corrections are entered. If the numbers equal, you are ready to close the Accounts Payable Module for the year.
7. Print the Aged AP Report to an electronic file.
8. Log off Dynamics SL and back up the database.
9. Login into Dynamics SL. Go to General Ledger > Processes > Closing (01.560.00) and close the Accounts Payable Module for the Closing Type: Year

Processing 1099s Checklist

When the end of the calendar year approaches, it is time to prepare for processing 1099s. These tax forms can be processed before or after AP Year End Close. You don’t have to wait until the Accounts Payable Module is closed. In fact, there are steps you can work on now to ensure a successful and smooth production of 1099s. Review the steps in this checklist before running 1099s.

1. AP Setup screen (03.950.00) – 1099 Tab: Confirm the 1099 Limit field is populated according to the IRS Minimum Amount.
2. 1099 Preview Report (03.730.00): Generate and review the information. Contact your vendors if the report shows missing Tax ID Numbers.
3. 1099 Vendors: Vendor Maintenance screen (03.270.00) – 1099 Info Tab:
4. Confirm 1099 Vendor dropdown = Yes.
5. Verify these fields are populated with correct data:
   • Default 1099 Box Number
   • Tax ID Number
   • TIN Name
   • TIN Incorrect Notice
6. Additional 1099 Resources:
   • Vendor History (Standard) Report (03.671.00) to verify accuracy of 1099 amounts.
   • Document History (Detail) Report (03.750.00) provides detailed information of all Accounts Payable documents, including open and paid vouchers and open and fully applied or paid adjustments.

If corrections are needed to the 1099 amounts, they can be entered in the Vendor Maintenance screen (03.270.00) in Initialize Mode.

Expert Tip: The formats and data needed for the 1099s are subject to IRS rules and regulations. Microsoft provides an annual Year-End Update package that incorporates the latest IRS information for Dynamics SL.

Our next segment covers the Flexible Billings, Order Management and Accounts Receivable Modules.

Click below to read these articles in the series:

• Part 1: Dynamics SL – Inventory Module
• Part 2: Dynamics SL – Purchasing and Accounts Payable Modules
• Part 3: Dynamics SL – Flexible Billings, Order Management and Accounts Receivable Modules
• Part 4: Dynamics SL – Project Controller Module
• Part 5: Dynamics SL – General Ledger Module

Reach out to our Dynamics SL experts for any additional information or to answer any specific questions.

About the Author

Jane Nygren is a Senior Consultant with the Customer Care SL Team, for Enavate Managed Services, a DXC Services Partner. She is a CPA with certifications in the States of Texas and Wyoming. Her MBA Degree is from the University of Tulsa. In additional to her Dynamics SL experience, Jane uses her Accounting knowledge and experience to resolve financial cases in the Customer Care SL Queue. She enjoys the simple things like going to the local Whataburger every Saturday (drive thru during the pandemic) and just hanging out with her husband and cat named ‘Little Girl’. Jane stays involved at her church. Her Hometown is Tulsa, Oklahoma. She currently lives in the Houston area.