The solution for Capital Groups
The app enables Microsoft Dynamics 365 Business Central (former Dynamics NAV) users from multiple companies to trade between other (mainly by exchanging the sales and purchase documents in real time). The solution combines the benefits of a typical EDI system with specific functionality requirements related to intercompany i.e. tracking quantities and values of in-transit items.
Managing transactions with the Advanced Intercompany module
The document synchronization process is triggered as soon as a new sales or purchase order is released (the document must contain the information that the vendor/customer is the intercompany partner). Then, the sales/purchase order is automatically sent to a partner company, where it is kept on hold until it is verified. The verification process can include such data as agreed delivery dates, quantities and prices. After the order is approved, the system creates a target document and sends a confirmation of the order receipt to the customer. This way, both companies verify and agree upon essential elements of the document before it is processed.
The system also sends a notification after the order is sent. This way, it keeps the user updated on the status of each intercompany transaction that is processed. After the items are received in the warehouse, the invoice is posted automatically which closes the settlement of the transaction.
In addition, it is also possible to send single documents e.g. service invoices that are not managed within the logistic process.
Despite the fact that the main assumptions for the app have been developed for capital groups, it can also be used in other organizations successfully, for example in a group of business partners that collaborate closely.
A complementary solution to the Master Data Management System module
The Advanced Intercompany module is usually implemented with another app called Master Data Management System that enables the standardization of master data (e.g. item) in all subsidiaries which facilitates the setup and functioning of the Advanced Intercompany app. However, the Advanced Intercompany app can be implemented as a standalone solution, provided that companies maintain data exchanged in standardized formats.
The D365 Business Central Intercompany module compared to the Advanced Intercompany add-on
¹ The assumption is that the intercompany partners manage their dimensions separately.
² Information – the document received contains the lines that have been mapped. Sample configuration: item numbers mapped, G/L accounts mapped, etc. ³ Warning – the document received contains a value that requires attention/verification. Sample configuration: the delivery date earlier than 3 days; the price different from the price for the intercompany partner, etc.
⁴ Error – the document received contains an error. Examples: the item has not been found, the G/L account does not exist, etc.
⁵ Buffer - if the document does not meet all of the required conditions, it will not be uploaded automatically to the target table (for example, to the Sales Header table), but it will be stored in the buffer. Sample conditions: the documents contain Warnings and Errors.
⁶ Negotiations – the intercompany partners agree upon the conditions of a transaction by exchanging the documents multiple times and adding their adjustments regarding the price, availability, discounts, delivery dates, etc. ⁷ Pre-Invoice process – goods shipped from one company are automatically received at a virtual location by the other company. This way, when the goods are in transit from one company to another, the value of the goods does not disappear from the books from the group perspective.
⁸ Both Standard (Dynamics 365 Business Central) Intercompany and Advanced Intercompany provide initial setup including the fields that will be exchanged between the companies. If it is required to add a new field that will be exchanged, the Standard Intercompany module requires object modifications by a partner (e.g. XML ports, codeunits, etc.). In Advanced Intercompany such a change is configurable and does not require any Dynamics 365 Business Central (Dynamics NAV) objects adjustments.
Benefits of implementing Advanced Intercompany
In addition to the benefits related to the reduced risk of making an error when entering an order into an ERP system, the Advanced Intercompany enables companies to monitor value streams for the inventory moved between subsidiaries within their capital group.
If the process is handled manually, it is difficult to calculate the value of items that have been sent but have not been received at a target location. With the Advanced Intercompany app, when items are sent from a source business entity/subsidiary, the system in the target subsidiary automatically posts the document as a receipt in an “in-transit” location and creates a transfer order between this location and the actual warehouse location.
The use of the Advanced Intercompany module enables business partners to: