Get to Know the New Dynamics 365 Finance and Operations Enterprise Cost Accounting Module
This article provides an overview to the new Microsoft Dynamics 365 for Finance and Operations Enterprise edition (D365FOE) cost accounting (CA) module and the underlying CA concepts by focusing on some key questions that you need to answer before making use of this module.
What is CA?
If you do a web search on the term CA you will come up with numerous hits that describe and define CA slightly differently. Despite the different terminologies, you will quickly find some common characteristics, such as
- a relationship to financial accounting,
- a need for classifying costs,
- a need for associating costs to their origin,
- a relationship to products, services or processes,
- a time relationship to the past and the future, and
- a relationship to managerial decision making.
What are the elements of a CA system?
A CA system (CAS) consists of three pillars that are illustrated in the next figure.
The foundation of a CAS
is made of the financial accounting system (FAS), which aims to present the
financial condition of the company in line with the prevalent general accepted
accounting principles (GAAP). In contrast to the FAS, the CAS aims to present the
‘true' picture of the company for internal stakeholders, such as the company's
management. Even though CA makes use of financial accounting data, it is not
restricted by GAAP regulations.
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