About centralized vendor payments [AX 2012]

Updated: May 27, 2011

Applies To: Microsoft Dynamics AX 2012 R3, Microsoft Dynamics AX 2012 R2, Microsoft Dynamics AX 2012 Feature Pack, Microsoft Dynamics AX 2012

Organizations that include multiple legal entities can create and manage payments using a legal entity that handles all payments. This eliminates the need to enter the same transaction in multiple legal entities and saves time by streamlining the payment proposal process, the settlement process, open transaction editing, and closed transaction editing for cross-company payments.

In a centralized payments organization, there are many legal entities for operations, and each operating legal entity manages its own invoices payable information. Payments for all the operating legal entities are generated from a single legal entity, which is called the legal entity of the payment. During the settlement process, the applicable due-to and due-from transactions are generated. You can specify which legal entity in the organization will receive the realized gain or realized loss transactions, and how cash discount transactions that are related to a cross-company payment are handled.

The following examples illustrate how posting is handled in various scenarios. The following configuration is assumed for all these examples:

  • The legal entities are Fabrikam, Fabrikam East, and Fabrikam West. Fabrikam is the legal entity of the payment.

  • The Post cash discount field in the Intercompany accounting form is set to Legal entity of the invoice.

  • The Post currency exchange gain or loss field in the Intercompany accounting form is set to Legal entity of the payment.

  • Fabrikam maintains a single global address book record, directory ID 1050, for Fourth Coffee. This global address book record is mapped to a separate vendor account in each legal entity.

Directory ID

Vendor account

Name

Legal entity

1050

3004

Fourth Coffee

Fabrikam

1050

100

Fourth Coffee

Fabrikam East

1050

3004

Fourth Coffee

Fabrikam West

Fabrikam East has an open invoice for vendor account 100, Fourth Coffee. Fabrikam enters and posts a payment to Fabrikam vendor account 3004, Fourth Coffee. The payment is settled with the open invoice.

Account

Debit amount

Credit amount

Expense (Fabrikam East)

600.00

Accounts payable (Fabrikam East)

600.00

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

600.00

Cash (Fabrikam)

600.00

Fabrikam posting

Account

Debit amount

Credit amount

Due from Fabrikam East (Fabrikam)

600.00

Accounts payable (Fabrikam)

600.00

Fabrikam East posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam East)

600.00

Due to Fabrikam (Fabrikam East)

600.00

Fabrikam East has an open invoice for vendor 100, Fourth Coffee. The invoice has a 20.00 cash discount available. Fabrikam enters and posts a payment of 580.00 for Fabrikam vendor 3004, Fourth Coffee. The payment is settled with the open Fabrikam East invoices. The cash discount is posted to the legal entity of the invoice, Fabrikam East.

Account

Debit amount

Credit amount

Expense (Fabrikam East)

600.00

Accounts payable (Fabrikam East)

600.00

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

580.00

Cash (Fabrikam)

580.00

Fabrikam posting

Account

Debit amount

Credit amount

Due from Fabrikam East (Fabrikam)

580.00

Accounts payable (Fabrikam)

580.00

Fabrikam East posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam East)

580.00

Due to Fabrikam (Fabrikam East)

580.00

Accounts payable (Fabrikam East)

20.00

Cash discount (Fabrikam East)

20.00

Fabrikam East has an open invoice for vendor 100, Fourth Coffee. Fabrikam enters and posts a payment for Fabrikam vendor 3004, Fourth Coffee. The payment is settled with the open Fabrikam East invoice. A currency exchange loss transaction is generated during the settlement process.

  • Exchange rate for EUR to USD as of the invoice date: 1.2062

  • Exchange rate for EUR to USD as of the payment date: 1.2277

Account

Debit amount

Credit amount

Expense (Fabrikam East)

600.00 EUR / 723.72 USD

Accounts payable (Fabrikam East)

600.00 EUR / 723.72 USD

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

600.00 EUR / 736.62 USD

Cash (Fabrikam)

600.00 EUR / 736.62 USD

Fabrikam posting

Account

Debit amount

Credit amount

Due from Fabrikam East (Fabrikam)

600.00 EUR / 736.62 USD

Accounts payable (Fabrikam)

600.00 EUR / 736.62 USD

Realized loss (Fabrikam)

0.00 EUR / 12.90 USD

Due from Fabrikam East (Fabrikam)

0.00 EUR / 12.90 USD

Fabrikam East posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam East)

600.00 EUR / 736.62 USD

Due to Fabrikam (Fabrikam East)

600.00 EUR / 736.62 USD

Due to Fabrikam (Fabrikam East)

0.00 EUR / 12.90 USD

Accounts payable (Fabrikam East)

0.00 EUR / 12.90 USD

Fabrikam East has an open invoice for vendor 100, Fourth Coffee. The invoice has a cash discount available and a sales tax transaction is generated. Fabrikam posts a payment for Fabrikam vendor 3004, Fourth Coffee. The payment is settled with the open Fabrikam East invoice. A currency exchange loss transaction is generated during the settlement process. The cash discount is posted to the legal entity of the invoice (Fabrikam East) and the currency exchange loss is posted to the legal entity of the payment (Fabrikam).

  • Exchange rate for EUR to USD as of the invoice date: 1.2062

  • Exchange rate for EUR to USD as of the payment date: 1.2277

Account

Debit amount

Credit amount

Expense (Fabrikam East)

564.07 EUR / 680.38 USD

Sales tax (Fabrikam East)

35.93 EUR / 43.34 USD

Accounts payable (Fabrikam East)

600.00 EUR / 723.72 USD

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

588.72 EUR / 722.77 USD

Cash (Fabrikam East)

588.72 EUR / 722.77 USD

Fabrikam posting

Account

Debit amount

Credit amount

Due from Fabrikam East (Fabrikam)

588.72 EUR / 722.77 USD

Accounts payable (Fabrikam)

588.72 EUR / 722.77 USD

Realized loss (Fabrikam)

0.00 EUR / 12.66 USD

Due from Fabrikam East (Fabrikam)

0.00 EUR / 12.66 USD

Fabrikam East posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam East)

588.72 EUR / 722.77 USD

Due to Fabrikam (Fabrikam East)

588.72 EUR / 722.77 USD

Due to Fabrikam (Fabrikam East

0.00 EUR / 12.66 USD

Accounts payable (Fabrikam East)

0.00 EUR / 12.66 USD

Accounts payable (Fabrikam East)

11.28 EUR / 13.61 USD

Cash discount (Fabrikam East)

11.28 EUR / 13.61 USD

Fabrikam generates a payment of 75.00 for vendor 3004, Fourth Coffee. The payment is settled with an open invoice for Fabrikam West vendor 3004 and an open credit note for Fabrikam East vendor 100. The payment is selected as the primary payment in the Settle open transactions form.

Account

Debit amount

Credit amount

Expense (Fabrikam West)

100.00

Accounts payable (Fabrikam West)

100.00

Account

Debit amount

Credit amount

Accounts payable (Fabrikam East)

25.00

Purchase returns (Fabrikam East)

25.00

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

75.00

Cash (Fabrikam)

75.00

Fabrikam posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

25.00

Due to Fabrikam East (Fabrikam)

25.00

Due from Fabrikam West (Fabrikam)

100.00

Accounts payable (Fabrikam)

100.00

Fabrikam East posting

Account

Debit amount

Credit amount

Due from Fabrikam (Fabrikam East)

25.00

Accounts payable (Fabrikam East)

25.00

Fabrikam West posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam West)

100.00

Due to Fabrikam (Fabrikam West)

100.00

Fabrikam generates a payment of 75.00 for vendor 3004, Fourth Coffee. The payment is settled with an open invoice for Fabrikam West vendor 3004 and an open credit note for Fabrikam East vendor 100. The payment is not selected as the primary payment in the Settle open transactions form.

Account

Debit amount

Credit amount

Expense (Fabrikam West)

100.00

Accounts payable (Fabrikam West)

100.00

Account

Debit amount

Credit amount

Accounts payable (Fabrikam East)

25.00

Purchase returns (Fabrikam East)

25.00

Account

Debit amount

Credit amount

Accounts payable (Fabrikam)

75.00

Cash (Fabrikam)

75.00

Fabrikam posting

Account

Debit amount

Credit amount

Due from Fabrikam West (Fabrikam)

75.00

Accounts payable (Fabrikam)

75.00

Fabrikam East posting

Account

Debit amount

Credit amount

Due from Fabrikam West (Fabrikam East)

25.00

Accounts payable (Fabrikam East)

25.00

Fabrikam West posting

Account

Debit amount

Credit amount

Accounts payable (Fabrikam West)

75.00

Due to Fabrikam (Fabrikam West)

75.00

Accounts payable (Fabrikam West)

25.00

Due to Fabrikam East (Fabrikam West)

25.00


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