SOLUTION: Create Base System Parameters | My Assignment Tutor

Enterprise Resource PlanningLab. 1Objective Login to system Create Base System Parameters Setup financial environmentIf you are enrolled in MAN6916 you will be able to access Microsoft Dynamics AX.When you first login to AX you will see the ERP menu.Client SoftwareTo ease use the number of modules shown in the Navigation Pane should be reduced to theones that will be used. Click on the small icon at the bottom of the Navigation Pane.Select Navigation Pane Options.Untick the Modules you will not use.Close the Navigation Pane options form.Set-up financial PeriodEach company’s trading year (fiscal) requires a separate set of financial periods.Companies in Australia generally have trading years that operate from July toJune. However, in other countries they more regularly vary.The financial year is broken-down into a number of posting periods. Somecompanies use a 4 week ‘period’ with 13 posting periods a year but most usemonthly periods.There are many variances and understanding the posting periods of a companyis part of the systems requirements procedure.Use the form Period: General Ledger -> Set-up -> Financial CalendarCreate a fiscal calendar by selecting New Financial Calendar. Create acalendar as follows but place your company name at the end e.g. Type in thecode that is shown as your Company Id at the bottom right of your applicationthe code will be the similar to the first three characters of your ECU login namewith a number prior to the three characters. This is your Company Id and mustbe used where indicated in the lab.Your Company ID is not 1labBe sure to enter your Company ID after the year replacing 1Lab in thefollowing with your Company ID. Create the finacial year for the current year.Press Create.Reopen General Ledger -> Set-up -> Financial Calendar if necessary.Open the CalendarOpen the calendar.You will notice that a period has a number of types. Only an operating period canbe posted to through day-to-day processes.Notice that there are closed periods called Opening and Closing at the beginningand end of the year. These are used for automatic year-end functions. Closingcontains the year- end results and opening the situation for the next trading year.Why are there two periods rather than one? Because of adjustments. There is usually ahiatus between close of activity and auditor’s adjustments and the two accounts allows anorganisation to trade and also post adjustments to the opening balances later in the tradingcycle.Close the form.Create an employeeA company obviously has employees. Employees need to be entered into the system forpayroll, HR and many other purposes. Some functions in Dynamics AX require approvalfrom an employee. For instance creating a Bill of Materials requires approval as the partslist needs to be validated as correct.You, therefore, need to set-up at least one employee.Use the Employee form. Human Resources -> Common -> Workers -> Employee.If the following form appears. Press Close.Create an employee with your name (remember to press Ctrl N).Enter the following details but use your name and Company Id which thesystem will default to.Press Continue to create the employee.The following screen will be displayed, press Complete.Close the formGeneral Ledger SetupBefore establishing general ledger information it is required to setupbackground parameters.Open form Ledger: General Ledger -> Setup -> LedgerRight click on Chart of Accounts and select View Details.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-10Do not select a chart of accounts. If you do youwill have to redo all steps from this point forward.You must create a set of accounts.UseNew to create an entity as followsThe intellectual property contained in this document is owned by Dr. Richard Fulford.1-11Type in the code that is shown as your Company Id at the bottom right of yourapplication. Yours will differ to the below.Ensure you use your Company Id.Close the form.On the Ledger form enter the Chart Of accounts that you have created, the one with on your company code. This ismost important. Enter the Fiscal calendar as the one you have created. The Accounting Currency as AUD andReporting Currency USD. – if you use the select menu and cannot see USD select the All tab.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-12Close the form.Setup Chart of AccountsEvery company has a general ledger (GL) or accounts. ERP systems maintain many ofthe postings to the GL accounts automatically. You now need to establish the accountsfor your organisation.Use the Main Accounts form: General Ledger -> Common -> Main AccountsAn account has a code. In many organisations these are numbers but some organisationsuse alphas. For the accountants amongst you, Dynamics AX does not sub-account at theGL account level. For instance; payroll sales dept., with an account code for payroll of21000 and department code for sales as 400, would not be encoded as 21000.400. Youwould simply setup the account code for payroll as 21000. Transactions posted to 21000would be identified with a department code.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-13The accounts have a name and in Dynamics(AX) a search name. There is also an accounttype:- Header, Empty Header and Page header are simply used to make the accountsmore presentable. Page header will create a page break when accounts arereported. Empty Header allows a blank line to be inserted and Header containsheading for the following accounts. Accounts can be set-up as Profit and Loss and Balance Sheet or with further detail.Revenue, Cost can be used in place of Profit and Loss, Asset and Liability can beused in place of Balance Sheet. In certain countries, Denmark for instance,accounts have to be identified as Revenue, Cost, Asset and Liability. You willidentify posting accounts as either Profit and Loss or Balance sheet.Select Create New account.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-14The following form is displayed.If you receive the following error ignore and close the form.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-15You will establish a GL accountsFirst you will enter a Profit and Loss account. The first entry is a header account of Sales.10000 Sales (Reporting – Header)Enter into the form as follows.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-16Create account11000 Sales Mobiles Profit and Loss Category: SalesThe intellectual property contained in this document is owned by Dr. Richard Fulford.1-17Enter the following information for the next three accounts. You do not need to close the form Use the Newfunction12000 Sales Laptops Profit and Loss Sales13000 Sales Components Profit and Loss Sales19999 Total Sales Total (Total 11000 -13000)The intellectual property contained in this document is owned by Dr. Richard Fulford.1-18The accounts with a type of Total allow the automatic totaling of a number ofconsecutive accounts. The range of accounts to be totaled are entered with a range of‘from account’ code to a ‘to account’ code. The account must be of type Total for theThe following shows the range that would be entered for the total.Use Total function.Enter the range of accounts to be totaled as follows.The intellectual property contained in this document is owned by Dr. Richard Fulford.1-19Close the form.Add the following account.20000 Cost Of Goods Sold COGS (Reporting – Header)Add the following accounts as Profit and Loss accounts unless identified as reporting ortotal.21000 COGS Mobiles Profit and Loss COGsThe intellectual property contained in this document is owned by Dr. Richard Fulford.1-2022000 COGS Laptops Profit and Loss COGS23000 COGS Components Profit and Loss COGS29500 Total Cogs Total (Total 21000 -23000)The intellectual property contained in this document is owned by Dr. Richard Fulford.1-2129999 Gross Profit Total 11000 -2300030000 Expenses Reporting Header31000 Freight Profit and Loss OTHEREXPThe intellectual property contained in this document is owned by Dr. Richard Fulford.1-2232000 Payroll Profit and Loss SALARYEXP33000 Telephone Profit and Loss OTHEREXP34000 Postage Profit and Loss OTHEREXP35000 Depreciation Profit and Loss DEPREXP36000 Error/Variance Profit and Loss OTHEREXP39999 Operating Profit Total (Total 11000 -36000)The intellectual property contained in this document is owned by Dr. Richard Fulford.1-2341000 Corporation Tax Profit and Loss TaxExp42000 Extraordinary Items Profit and Loss OTEHREXP49500 Net Profit Total (Total 11000 -42000).1-24Balance SheetAll Account Types Should Be Set-Up Balance Unless Shown Otherwise In The ColumnOn The Right.50000 Balance Sheet Reporting Page Header60000 Assets Reporting Header.1-2561000 Fixed Assets Reporting Header61100 Plant And Machinery Balance Sheet OTHER ASSETS61200 Accumulated Depreciation Balance Sheet ACCUDEP61300 Depreciation Current Year Balance Sheet ACCUDEP.1-2661999 Total Fixed Assets Total 61100 -6130062000 Current Assets Reporting Header62100 Inventory Reporting Header62200 Raw Materials Balance Sheet Inv.1-2762300 Raw Materials Received UninvoicedBalance Sheet Inv62400 Fin. Goods Mobiles Balance Sheet Inv62500 Fin. Goods Laptops Balance Sheet Inv62999 Total Fin. Goods Total 62400 -6250063300 Work In Process (Wip) Reporting Header.1-2863320 WIP Mobiles Balance Sheet WIP63350 WIP Laptops Balance Sheet WIP63380 Total WIP Total 63320 -63350)63999 Total Inventory Total 62200 -63350.1-2964000 Accounts Receivable Reporting Header64100 Accounts Receivable Australia Balance Sheet AR64200 Accounts Receivable Foreign Balance Sheet AR64999 Total Accounts Receivables Total 64100-64200.1-3065000 Liquid Assets Reporting Header65100 Bank Balance Sheet CASH65200 Petty Cash Balance Sheet CASH65999 Total Cash Total 65100-65200.1-3169999 Total Assets Total 61100-6520070000 Liabilities Reporting Header71000 Shareholders Equity Balance Sheet COMMONSTOCK.1-3271100 Year-End Result Balance Sheet RETEARN71200 Total Equity Total 71000-7110072000 Long Term Debt Balance Sheet LONGTERMDEBT.1-3373000 Accounts Payable Reporting Header73100 Accounts Payable Australia Balance Sheet AP73200 Accounts Payable Foreign Balance Sheet AP73999 Total Accounts Payable Total (73100-73200).1-3474000 GST Reporting Header74100 GST Sales Balance Sheet TAXPAY74200 GST Purchases Balance Sheet TAXEXP74300 GST Settlement Balance Sheet TAXPAY74999 GST Total Total 74100-7430079999 Total Liabilities Total 71000-74300.1-35Close the formPress Control F5 to refresh the Main Accounts form. The accounts will be displayed.If you are not familiar with these terms it is not of consequence for this unit. However,nearly all ERP implementations, above 95%, will have a financial element and baseknowledge of accounting is very useful..1-36Generally the organisation that is implementing the software will inform the consultantsof the Chart of Accounts structure. Be sure to leave gaps in your numbers (notconsecutive numbers) so additional accounts can be entered at a later date.Setup Systems PostingsWhen an ERP makes automatic postings to the General Ledger small rounding andsettlement differences due to exchange rates, etc., may occur. Also, if the system is notsetup properly some postings may still operate, but the system will have to post them to adummy account. The system needs to know where to post these anomalies and uses theSystems Accounts to manage them.Go to the Systems Account form – General ledger -> Setup -> Posting -> Accounts forautomatic transactionsPress the Create Default Types button – the descriptions may vary, Order rather thanSales for instance but ignore the differences. Set the accounts shown below to 36000 –the Error/Variance account except Year-end result which should be 71100. Select NEWand add Bank set account to 65100..1-37Press ClosePosting Setup.Open the Ledger form: General Ledger->Setup->Ledger ParametersSet the posting parameters for batch Transfer as follows..1-38Close the form.Create an Account StructureOpen form Configure account structure: General ledger‐>Setup‐>Chart of Accounts‐> Configureaccount structureChoose New Account Structure and add your COMPANY ID plus the word structure. Press OK..1-39Choose Activate.Close the form.Open form Ledger: General Leger‐>Setup‐>LedgerEnsure the Chart of Accounts is set to the account you created that is similar to your CompanyId. See below in yellow.Set the default exchange rate types as below.Set the default accounts to the error variance account of 36000. This will post system variancesto these accounts. Your Chart of accounts should show your company name..1-40Add the Account Structure YOU (Your Company Id plus word “Structure”) created by pressingthe Add button and selecting the account structure..1-41Close the form.Setup exchange ratesWhen a company trades with overseas suppliers it generally has to use more than onecurrency. Therefore, the system must maintain exchange rates. We will establish threecurrencies: Australian dollars as AUS. UK Sterling as GBP and US Dollars as USD.Open the exchange rate form: General Ledger -> Setup -> Currency-> CurrenciesAX has all currency codes established.As exchange rates alter on a day-to-day basis exchange rates generally have a dateassociated with them. The current or most recent date is used by the system to identifythe relevant exchange rate. To reduce setup leave the Start Date field blank.If the entry does not exist. Enter the GB Pound (£) sign add the symbol using InsertSymbol in a Word Document and copy and paste.Exchange rates might need to be rounded when calculated. Use the following settings forGBP and USD..1-42Close the formOpen form: General Ledger -> Setup -> Currency-> Currency Exchange RatesSet the system to be the “average” exchange rate – because the same currency can haveseveral rates, the posting date determines the rate applied.For example:An exchange rate is entered on January 1, and another exchange rate is enteredon February 1. If a sales order is invoiced on January 15, the exchange rate fromJanuary 1 is used to calculate the invoice amount. If an exchange adjustment isrun on February 2, the rate from February is used as an adjustment.Use the New function to enter exchange rates as follows..1-43Note: the currency look up has two tabs. If you cannot locate the currency use the All tab.Enter Euro exchange rate.1-44Enter USD exchangeEnter GBP exchange rateClose the exchange rate form.Setup Company Info.You need to provide a name for your company.Go to the Company Information form: Organization administration/Setup->Organizational Administration-> Legal entitiesChange the language to EN-AU (English Australian)..1-45The base financial setup is now complete.