Topic Covered: Ledger Allocation Rule, Ledger Allocation Basis, Statistical Account

This Blog is about how a default ledger allocation works based on ledger allocation rule set-up in Dynamics 365 for Finance and Operations.

For an organization that needs to segregate its expenses based on multiple dimensions, cost centers, and projects, Dynamics 365 Finance and Operation provides a solution that can automatically split up using Ledger allocation rule.

Configure the following steps in Dynamics 365 F&O for Ledger allocation rule:

  1. Search Ledger Allocation Rule Or General Ledger -> Allocation -> Ledger Allocation Rule
  • Click New and Create a new ledger allocation rule. Ex: Admin Expenses (Admin). Fill in the details:
  • Rule name
  • Description
  • Allocation Method
  • Journal Name
  • Click on Source icon 
  • Field setting as financial dimension and select appropriate business unit
  • Field Setting as Main Account and select Ledger main account no.

Note: We are selecting Admin Expenses Ledger as Main account.

  • Click on destination
  • To Account
  • To Financial Dimension

Here, we are allocating the expense to the same GL account but to different Business Unit (Dimension)

  • D_RE
  • D_PO
  • D_ST

Scenario

Smith, The Account Manager of Sydney University, booked an entry for 7,000 AED in Ledger Account Administrative & General Expenses (9050) by using a single business unit (152- C_TS) and he want the amount to segregate into different business unit (courses) based on No. of Student in each department – (158-D_RE) (160-D_PO) (161-D_ST) & (159-D_CHE)

The following table shows the type of accounts defined and the business units:

Ledger Account Account Name
9050 Administrative & General
9190 Head Count
9990 Offset Account

Following are the dimensions defined:

Dimension Code Dimension Name No. of Students
152-C_TS College Overall Spending
158-D_RE Religious Education 15.00
160-D_PO Personality Development 25.00
161-D_ST Statistics 30.00
159-D_CHE Chemistry 10.00

Below is the entry posted for 7000 AED

To define no. of student against each department: – 1

Setup a GL Account under Main Account Category as – STATISTICAL

An Example of a journal entry using statistical Account, Posting No. of resource against each course (Business Unit)

After posting entry with the statistical account, create LEDGER ACCOUNT BASIS.

  • General -> Allocation -> Ledger Account Basis
  • Click new and create new Ledger Allocation Basis
  • Define Field Setting Financial Dimension > Business Unit and select the Source Criteria – 152-C_TS
  • And the main account as 9190 (Head Count – STATISTICAL ACCOUNT)
  • Save and close it.

To Process Allocation Request:

  • Go to General Ledger -> Periodic -> Process Allocation Request
  • Select appropriate Basis ID and run the process allocation batch job.
  • Click on ok and go to general ledger > Journal > Allocation open last entry and view the detail.

Result:

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