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Percent of Completion Accounting in D365 F&O: An Out-of-the-Box Journey

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#accounting

Dynamics 365 Finance

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Feb 22, 2025

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  • Percent of completion accounting in Dynamics 365 Finance & Operations allows for recognizing revenue and expenses based on work completed.
  • Key formula for revenue recognized is (Total estimated revenue × % complete) – Revenue recognized to date.
  • Dynamics 365 F&O's project management module simplifies percent of completion tracking.
  • D365 F&O offers robust project accounting functionality with built-in percent of completion tracking.
  • Steps in handling percent of completion accounting include project setup, assigning project stages, cost and effort tracking, revenue recognition methods, and periodic revenue recognition.
  • Examples provided include a construction project using cost to cost method and a professional services firm using percentage of effort method.
  • Watch-outs include scope changes, overruns, and audit trails for traceability.
  • Percent of completion accounting in D365 F&O benefits industries like construction, premium home builders, professional services, and subscription services.

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