What You Can Expect from the 2023 Release Wave 2 for Dynamics 365 Finance and Operations
The 2023 Release Wave 2 for Dynamics 365 Finance and Operations brings a ton of great enhancements and updated features that will help you continuously improve your business processes.
In this blog, we will break down some of the core areas of improvement, most of which are set to go live between October 2023 and March 2024.
Dynamics 365 Finance
In a time when you need to balance business agility and cost savings, the following enhancements to Dynamics 365 Finance can help you optimize your operations and save money.
Here are some of the core financial updates:
Net Customer and Vendor Balances
This feature lets you utilize customer and vendor balance netting. This means your organization is offsetting the balances between a customer and a vendor when they are the same entity. It will help you reduce unnecessary money exchanges, save on transaction feeds, and streamline operations.
Archive Tax Transactions
This feature focuses on archiving tax transactions to save you storage space and improve your systems’ performance. It allows you to securely transfer transaction data to your data archive while keeping the ability to report and analyze historical data using your standard reporting tools.
Check Number Validation
You can now validate check numbers to enhance your check processing accuracy and reduce the risk of errors such as returned or rejected checks. You can use two validation options:
- Interval Validation – Establishes a default check number interval in cash and bank management parameters.
- Character Validation – Requires confirmation for any presence of non-numeric characters in a check number.
Post New Transactions Directly from Bank Reconciliation
Microsoft introduced this feature to automate various steps in your bank reconciliation process. Users can now easily flag and post new transactions – such as bank fees and interest – directly within the worksheet, eliminating the need to switch back and forth between the worksheet and the bank statement.
Support Customer Refunds with Credit Transfer Format
Before this update, users had to go through a tedious process for refunds, especially when dealing with the ISO20022 format. The new features automate the creation of payment files in that format and make it easier to handle SEPA and generic ISO20022 payments.
Support More Complex Bank Reconciliation Matching Rules
Users can now define more complex matching rules between multiple bank statement lines and multiple bank account transactions. This automation can be completed for the following scenarios:
- 1:N – One bank statement line matches with multiple bank transactions
- N:1 – Multiple bank statement lines match with one bank transaction
- M:N – Multiple bank statement lines match with multiple bank transactions
Use Bank Foreign Currency Revaluation Enhancements
Microsoft says it is enhancing the bank foreign currency revaluation in two ways:
- It will now allow an organization to define whether to use all or none of the financial dimensions when calculating the unrealized gain or loss, reducing the number of lines included in the accounting entries for each bank FCR.
- The calculation of the unrealized gain or loss will change, allowing organizations to give a clear definition of the calculation to auditors, while also preventing a situation where large amounts are posted to different dimensions.
Calculate Gain/Loss for Reporting Currency Only
As it stands, no realized gain/loss is posted if the reporting currency doesn’t balance to zero if the accounting currency is in balance (debits = credits) for matched transactions in ledger settlement. This new feature uses the accounting currently for matching the ledger settlement, speaking up your process.
Financial Tags Added to Accounting Distributions
You can now apply your financial tags to accounting distributions using the source document accounting framework. This allows you and your users to input financial tag values on the Accounting distribution page and comes with many additional features.
Check Our New AP Clerk Workspace Capabilities
While the current invoice automation feature can handle most invoices, there are still some frustrating cases that require user intervention. Enhancements to this feature will provide a centralized place for accounts payable clerks to see all pending vendor invoices with various statuses during automation, as well as continue to do their routine work.
Handle Periodically Recurring Invoices
This new feature addresses a large gap in function and lets your team handle periodically recurring invoices, like monthly electricity payments or monthly insurance for example.
You can customize the setup of this feature and take advantage of the automation that generates Accounts Payables invoices.
Import Bank Statements Automatically
This feature will save your team a tremendous amount of effort, as they can now replace the manual upload of bank statements with a batch job from a SharePoint folder.
Enhancements to Business Performance Analytics
Tracking your data and how your team works can help you identify areas of improvement and celebrate areas of success. With the 2023 Wave 2 Release, enhancements to this area centralize financial and non-financial data and metadata into the Dataverse. This gives you a single data source for reporting.
Other enhancements to Business Performance Analytics include:
- Reporting hub based on reports on data – Helps you find and use relevant reports by business process quickly and easily. You can also edit, share, and group them – doing this all in a centralized location.
- Security – Gives you the ability to create refreshable, prewritten reports that you can send to any sector of your organization. You can also customer role-level security capabilities for people throughout your organization.
Extended Planning and Analytics for Dynamics 365 Finance
These updates enable company-wide planning for your Dynamics 365 Finance and Operations environment so you can make quicker decisions using Power BI and Microsoft Excel. This improves your user experience in performing financial analysis, forecasting, budgeting, and drive-based planning.
Invoice Journal Option Available in Invoice Capture
While the Invoice Journal Option feature already exists, Microsoft is extending it by making it available in invoice capture. This can streamline your invoice processing scenarios for customer invoices.
Calculate Foreign Currency During Ledger Settlement
If you use this feature right now, you’ll notice ledger settlements are based solely on accounting currency amounts, ignoring reporting and currency discrepancies. Upgrades to this feature solve this issue by letting you post gain or loss entries for accounting and reporting currencies. The specific features of this capability will be rolled out in stages.
Use Deferral Schedules with Stocked Materials
You can now take advantage of cost deferral accounting based on the latest calculated inventory value. This eliminates some of the manual work that takes up your team’s valuable time.
Dynamics 365 Supply Chain Management
Copilot and AI Innovation
Microsoft’s focus on AI with Copilot is extending into D365 Finance and Operations, as you can now use it for procure-to-pay processes. It comes with a conversational user experience and many other features to help your team work more efficiently.
Inventory and Logistics
Here are highlights of some inventory and logistics updates in the 2023 Wave 2 release:
- Manage prices with pricing management workspace – Allows sales manager to review and modify pricing policies without leaving the workspace.
- Sell and price multiple items as a bundle – You can efficiently group and price items together, simplifying order entry, recognizing revenue correctly, and ensuring bundled items can be shipped individually. This is replacing the deprecated bundle feature.
- Offset inventory visibility adjustments – Simplify the reconciliation of real-time inventory adjustments made in the Inventory Visibility service with transactions. This prevents duplicate data.
- View and manage inventory with a new mobile app – Get real-time visibility from wherever you are. This mobile app streamlines tasks, enhances customer service abilities, and replaces an old, less efficient app.
- Enable prospects in prospect-to-cash with dual-write – Smooth integration between prospects between Dynamics 365 Sales and Dynamics 365 Supply Chain management.
- Apply compound charges to quotations and sales orders – Calculate surcharges based on a percentage of the full order price, including previously applied surcharges. Also allows for setting minimum surcharges or delivery fees to cover costs.
- Increase sales order agility with classes and advanced holds – Introduces order classes for distinguishing different types of sales orders and advanced order holds that automate the application and removal of hold codes.
- Find products and on-hand information by attribute – Simplify inventory searching by allowing your users to find on-hand inventory details across organizations easily using descriptive terms like product name, brand, size range, and more.
Manufacturing Asset Management
Microsoft announced a few enhancements to streamline your manufacturing asset process.
- Detect spikes and deviations in sensor data – Enhances Sensor Data Intelligence by introducing an anomaly detector that predicts and prevents equipment issues by monitoring sensor data and automatically selecting the best anomaly algorithm.
- Over pick materials for production and batch orders – Enables warehouse staff to efficiently over-pick raw materials for production orders as needed with configurable limits.
- React to last-minute changes in production – Offers enhanced flexibility for manufacturers to adapt to last-minute changes in production orders.
Inform Vendors When About to Ship Items
This feature introduces a ship date field in purchase orders that is calculated based on configured transport dates. This clears the path for concise communication and coordination with vendors regarding when they should ship items.
Product Information Management
Manage Compliance with Export Control Restrictions
Enhancements to this feature allow you to manage, track, and ensure compliance with international trade regulations and internal policies, utilizing Microsoft Dataverse for rule management, real-time enforcement, and flexibility in handling complex scenarios using Microsoft Power Platform.
Automatically Update Documents when Receiving Purchase Orders
You can streamline the process of receiving purchase orders by allowing the system to automatically update the relevant purchase documents after inventory has been received in the warehouse.
Optimize the Customer Returns Process
Supply Chain Management now allows you to streamline the customer return process by allowing users to efficiently manage returns, automate return label printing, and quickly process returned items using the Warehouse mobile app.
Optimize the Inbound Receiving Process
Also operating in the Warehouse Management mobile app, this new feature saves your team time by optimizing the process of receiving large quantities of serial or batch-tracked items on license plates.
Automatically Re-Wave to Add Unfulfilled Lines to New Waves
If you’ve worked with the existing feature, you know waved lines can sometimes fail due to a lack of on-hand inventory at the picking location. This meant you’d have to handle each exception manually by adding the fails lines to a new wave and then processing them.
This update automates that process and assigns the failed lines to the same wave templates and then re-waves them without human intervention.
Optimizing Dynamics 365 Project Operations
Microsoft is announcing some exciting updates to D365 Project Operations to further streamline the connection between your sales, resourcing, project management, and finance teams so you can accelerate delivery, empower your employees, and increase profits.
Here are some of the main updates:
- Create budgets with summarizations during estimate report - Streamline budget creation by summarizing import from estimates, allowing for easier tracking of budgeted costs at a granular level, such as tasks or roles, by reducing the number of budget lines created during import.
- Easily summarize budget lines in Dynamics 365 apps – Gives you a more flexible forecast line creation in finance and operations apps by summarizing budget lines at various levels, like tasks, roles, or contracts.
- Enable default financial dimensions for bookable resources - This feature automatically assigns an employee's financial dimensions to hours-based transactions, enhancing cost tracking by including additional cost details related to labor in both the project subledger and general ledger voucher of the integration journal.
- Get recommendations on the best resources for your project – This is an AI-powered and heuristic-based recommendation engine that factors in resource availability, skill matching, cost, utilization, and collaboration dynamics, aiming to suggest the most suitable resources for projects.
- Progress-based billing on fixed-price contracts - This feature allows project managers to invoice customers based on the progress of work, accommodating progress-based contracting models in addition to the existing milestone-based billing.
- Improved Project invoicing usability and performance - Streamlines the invoice review process for large project teams with usability improvements for Project Managers and enhanced control over invoice creation.
- Increase WBS Limits - This allows you to create more extensive work breakdown structures with a greater number of project tasks, resource assignments, and dependencies.
- Update Tasks as Complete from the Task Grid - Streamlines task completion in Dynamics 365 Project Operations by enabling project managers to mark leaf node tasks as complete directly in the Task grid.
- Support prospects on quotes – Streamlines the transition from prospect to customer status, enabling salespeople to generate accurate quotes for a broader range of accounts.
- Copy quotes and contracts across legal entities - This feature gives you precise control over duplicating quotes or contracts by allowing you to specify the target legal entity, customer, and business unit.
- Derive cost-based bill rates – Enables your organization to calculate bill rates based on resource cost rates.
- Provide time zone agnostic fields – This update introduces non-time zone-dependent start and end date fields for projects and project tasks.
- Expense mobile app offers intuitive reimbursement experience - This release introduces a more intuitive expense mobile app for Project Operations.
- Explore advanced subcontract capabilities – These enhancements provide improved visibility and automate the three-way match process for vendor-reported time, expenses, and material consumption.
- Support for intercompany vendor invoices in resource and non-stocked-based scenarios – This feature boosts efficient documentation and management of intercompany invoices from suppliers within Dynamics 365 Project Operations.
- Support historical tracking using project sales budget – This feature, initially introduced in the 2023 release wave 2 for the lite deployment type of Dynamics 365 Project Operations, offers project managers the ability to create and track project sales budgets.
Finance and Operations Cross-App Capabilities – One Dynamics One Platform
Microsoft has also announced cross-application updates that will help you connect your Dynamics 365 Finance and Operations capabilities to your other Microsoft Dynamics solutions.
Export to Data Lake Transitions to Synapse Link for Dataverse
Users can now find and select data from all of their Dynamics 365 apps within a single integrated space. This upgrade also comes with the ability to leverage advanced Synapse Link for Dataverse features including support for restricted storage accounts, Parquet format, and Delta Lake.
If you're an AX 2012 or AX 2009 customer planning an upgrade to cloud-based finance and operations, you can easily query finance and operations data using Azure Synapse Analytics. You can preserve your existing data integration pipelines by accessing finance and operations data in the lake in table form.
Enable Support for Asynchronous Operation in Dual-Write Functionality
Dual-write currently supports initial synchronization and live synchronization modes, but this release takes it another step further by enabling asynchronous business processes to participate in dual-write functionality.
Microsoft Supply Chain Center
Microsoft Supply Chain Center is a versatile solution that simplifies supply chain management through a low-code/no-code experience that increases insights, collaboration, and process enhancement. enabling insights, collaborative actions, and process orchestration. It integrates with both Dynamics 365 Supply Chain Management and third-party ISV apps. Microsoft has announced upgrades to this integration in the following areas:
- Copilot in Microsoft Supply Chain Center
- Intelligent Order Management
- Microsoft Supply Chain Center Foundation and Platform
- Supply and demand insights
Want to Learn More About What These Features Can Do For You?
Get in touch with us! Our Dynamics 365 Finance and Operations team can help you navigate these exciting updates and how they can help you get the most out of your business processes.