Key tasks: Manage customer payment retention for projects [AX 2012]

Updated: October 9, 2012

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

A project customer might want to withhold or retain an amount from payment to your organization for a project invoice. In Microsoft Dynamics AX, the customer payment retention terms are defined in the project contract. The payment retention terms include the criteria for releasing a retention amount. You can define the payment retention terms as a specific amount or as a percentage of the value of a contract. You can also define the retention amount as a percentage of an invoice amount.

When you set up the payment retention terms for a customer, you enter a percentage or amount in the project contract with the customer. The retention amount for a project invoice is calculated automatically, based on the retention percentage. The retained amount is automatically subtracted from the invoice amount. When the project has reached a specified level of completion, and the customer approves the work, you create an invoice for the retained amount. No retained amount is retained from subsequent invoices on the project.

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About customer payment retention for projects

Before you can set up payment retention terms for a project, you must complete the following tasks:

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When you set up payment retention terms for a customer, you specify the percentage of customer invoices to retain. You can also enter a percentage of completion for retention on the project. Amounts are automatically retained on project invoices for the customer until the project reaches the specified percentage of completion.

  1. Click Project management and accounting > Setup > Retention > Customer payment retention terms.

  2. In the Customer payment retention terms form, click New.

  3. In the Description field, enter a descriptive name for the retention term.

  4. In the Schedule section, click Add line.

  5. In the Percentage of work complete field, enter a percentage of completion for the project. Amounts are automatically retained on project invoices until the project stage reaches this percentage. For example, if you enter 50 percent, amounts are retained until the project is 50 percent completed.

  6. In the Customer payment retention percentage field, enter the percentage of the invoice amount to retain until the specified percentage of work is completed.

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When you create a project contract, you can set up the customer payment retention terms. When you create a project and associate it with the project contract, the retention terms that you specify in the project contract are displayed on the Payment retention terms FastTab in the Projects form.

  1. Click Project management and accounting > Common > Projects > Project contracts. Open a project contract in the list, or create a new project contract.

  2. In the New project contract form, enter the project contract information, such as the contract ID, funding type, and sales currency. When you click OK, this information is added to the project contract header.

  3. In the Project contracts form, on the Funding sources FastTab, add information about the funding sources, language, and invoice format for each funding source.

    ImportantImportant

    Customer retention terms can only apply to a funding source of Customer.

  4. In the Customer payment retention terms field, select the customer payment retention terms for the selected funding source.

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When work on the project reaches the percentage of completion that is specified in the retention terms, you can create an invoice for the project. The retention amount is automatically subtracted from the invoice amount.

  1. Click Project management and accounting > Common > Projects > All projects. Open a project from the projects list page.

  2. In the Projects form, on the Action Pane, click Edit.

  3. On the General FastTab, in the Percentage of work complete field, enter the percentage of work that is completed on the project to date.

    The percentage of work completed is automatically compared with the payment retention terms. If the percentage of work that is completed on the project is less than the percentage of completion specified in the payment retention terms, a payment retention amount is calculated and subtracted from invoices that you create for the project.

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As work is completed on projects, you can view the status of payment retention amounts by project, by billing rule, by customer, and by invoice.

  1. Click Project management and accounting > Common > Projects > All projects. Open the project from the projects list page.

  2. In the Projects form, on the Action Pane, on the Control tab, in the Retention group, click Customer retained payments.

  3. In the Inquire customer retained payments form, on the Customer payment retention summary FastTab, review the amounts in the Total retained amount, Total retained amount invoiced, and Remaining retained amount fields for the project.

  4. On the Funding sources FastTab, you can review the retained amounts by customer funding source for projects that are funded by multiple sources.

  5. On the Invoices FastTab, review the retained amounts for each invoice.

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When a project is completed or reaches the percentage of completion specified in the project contract, create an invoice proposal to request payment by the customer of the retained amount.

  1. Click Project management and accounting > Common > Projects > All projects. Open the project from the projects list page.

  2. In the Projects form, on the Action Pane, on the Manage tab, in the Bill group, click Request retained amount.

  3. In the Request for customer retained amount form, on the Project invoices FastTab, select the invoice for which to create an invoice proposal, and then, on the menu bar, click Create invoice proposal.

  4. In the Invoice proposals form, review the value in the Retention release amount field, and then post the invoice proposal.

    If your organization uses workflow, submit the invoice proposal to workflow for approval.

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Announcements: To see known issues and recent fixes, use Issue search in Microsoft Dynamics Lifecycle Services (LCS).

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