Dynamics 365 Business Central Tips and Tricks: Streamline General Journal Analysis and AR Chargebacks by Creating Alternate Posting Groups

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In this blog, we discuss how setting up posting groups in Dynamics 365 Business Central allows you to map entities (customers, vendors, items, resources, sales orders, and purchase orders) to general ledger accounts. Doing this saves time for your accounting staff and helps avoid mistakes when they post transactions.

The transaction values go to the accounts specified in the posting group for a particular entity. The only requirement is that you have a chart of accounts. The posting groups fall under three umbrellas—General, Specific and Tax. You can set them up in Dynamics 365 Business Central using the guidelines below.

General Posting Groups

This is where you define the customers you sell to, the vendors you buy from, and the items you sell and buy. As you set these groups up, consider how many groups you will need to break down sales and purchases—such as grouping customers and vendors by geographical area or by business type.

Likewise for the general product posting groups, consider the number of groups to break down sales by product (items and resources) and purchases by items. For example, you might divide these groups by raw materials, retail, resources, or capacity.

Specific Posting Groups

Consider creating specific groups for customers, vendors, inventory, bank accounts, and fixed assets. For customer and vendor posting groups, you can define the accounts to use when you post AR and AP transactions. If you use inventory with receivables, the accounts that the sales order lines post to are determined by the general business posting group assigned to your customer, and the general product posting group assigned to the inventory item.

For inventory posting groups, you can assign relevant item accounts on the inventory posting set-up page. When you post item entries, the system will post to the G/L account for the combination of inventory posting group and location that is linked to the item. The inventory posting groups also organize your inventory so you can separate items by their posting group when you generate reports.

With bank account posting groups, the general ledger accounts that bank account entries are posted to will simplify tracing transactions and reconciling bank accounts. For fixed assets posting groups, you can define accounts for different types of expenses and costs. These include acquisition costs, accumulated depreciation amounts, acquisition costs on disposal, accumulated depreciation on disposal, gains on disposal, losses on disposal, maintenance expenses, and depreciation expenses.

Tax Posting Groups

Tax posting groups allow you to define tax percentages and calculation types that apply to the customers you sell to and the vendors you buy from as well as the items you sell and buy. The number of groups might depend on local tax legislation and whether you conduct business internationally.

You can combine tax business posting groups and tax product posting groups. When you fill in a general journal line, purchase line, or sales line, we suggest looking at the combination to identify the accounts to use.

Streamline Journal Analysis and Vendor Chargebacks

In addition to saving time for your accounting staff and helping avoid transaction posting errors, the posting groups in Dynamics 365 Business Central will streamline the analysis of your general journal. For example, you can choose the customer, vendor, or item group you want to post a single document to, and then see the total on a general journal by using the <Analyze> function. 

To Learn More

Western Computer offers deep expertise across the Microsoft technology stack, particularly in Dynamics 365 Business Central. Our thought leaders can help you ensure your critical ERP application meets your business needs for today and beyond. For more information on how to set up posting groups in Business Central, or for help in designing, deploying, or supporting your Microsoft Dynamics 365 solution, contact Western Computer today.