[How to]Competence date for transactions | ITALIAN Features

Dear Microsoft Dynamics 365 Lovers,

Lets explore the functionality together for competence date bookings in ITALIAN localization.

Business Scenario

In Italy, companies must use a posting date when they post transactions. The posting date in the fiscal journal is the date when the company acknowledges the transaction.

However, adjustment and closing transactions can be done several months after the last day of the fiscal year. (Usually, these transactions occur on the date when the balance sheet is approved by the Board of Directors.) These transactions must be reported on the Italian fiscal journal on the posting date equal to acknowledgement date, but they must have a reference to their competence date, which represents the date when the transaction affects the balance amount.

Configuration 

To enable this functionality for transactions, on the General ledger parameters page, on the Ledger tab, set the Transaction date reference to competence date option to Yes.

After the competence date is enabled, you can specify Transaction date as an acknowledgement date for each journal that can be used to post the adjustments and closing/opening transactions for the fiscal year:

This functionality is covered into the below area.

• General journal
• Fixed assets journal
• Bank account reconciliation (Bank > Bank accounts > Functions > Accounts reconciliation)
• Closing sheet (General ledger > Periodic > Fiscal year close > Closing sheet)
• Opening transaction (General ledger > Periodic > Fiscal year close > Opening transactions)
• Project – Post costs (Project > Periodic > Time & Material > Post Costs > Post)
• Project – Accrue turnover (Project > Periodic > Time & Material > Accrue turnover)
• Project – Estimate post (Project > Periodic > Estimate > Post)
• Project – Estimate reverse (Project > Periodic > Estimate > Reverse)

Example  

The company's fiscal year is from January 1 through December 31. The balance sheet is approved on April 15. Therefore, adjustment and closing transactions are reported on the Italian fiscal journal in April, but they affect the balance on December 31.

Run Fiscal journal report (General ledger > Reports > External > Fiscal journal). You get this transaction reported in the fiscal journal line with Posting date April,15 and Competence date December, 31

Run Voucher transactions query and form (General ledger > Inquiries and reports > Voucher Transactions). Add column Transaction date and review that Date is December, 31 and Transaction date is April,15.

And most importantly, the trial balance will be affected by the "Competence date" only as these transactions were for previous Fiscal year.

I hope this post will add some value to you