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Dynamics 365 Community / Forums / Finance | Project Operations, Human Resources, ... / Automate managing IT m...
Finance | Project Operations, Human Resources, ...
Answered

Automate managing IT maintenance and software license contracts expense recognition

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Posted on by CU17101105-0 33

Looking for advice on the best D365 F&O solution for managing IT maintenance and software licence contracts
We are currently reviewing options within D365 F&O to automate the management and accounting of IT maintenance agreements and software licence contracts, which are currently tracked using Excel spreadsheets.
Current Process
A typical example is a 12-month IT support contract:

  • A Purchase Order is raised for the full contract value.
  • The supplier invoices the full amount upfront.
  • The invoice is paid according to the agreed terms.
  • Finance then manually posts monthly prepayment journals to spread the cost over the 12-month contract period.
As we have a growing number of these contracts, we are looking to automate the expense recognition process and reduce manual month-end journals.
Questions
  1. Has anyone implemented Subscription Billing (Revenue and Expense Deferrals) for this type of vendor contract?
  2. If so, how is the deferral schedule linked to the transaction?
    • On the Purchase Order?
    • On the Vendor Invoice?
    • Through a Vendor Contract record?
  3. Is Subscription Billing considered the best practice approach for managing prepaid IT support and software licence costs?
  4. Alternatively, would you recommend using:
    • Purchase Agreements
    • Standard Prepayment functionality
    • Recurring journals
    • Another D365 F&O feature or process?


Are there any setup guides, implementation tips, or lessons learned that you would recommend before enabling Subscription Billing?
 

Our objective is to maintain the existing procurement process (PO → Invoice → Payment) while automating the monthly expense recognition over the contract term.
 

Any advice, examples, or best practice recommendations would be greatly appreciated.

Looking for advice on the best D365 F&O solution for managing IT maintenance and software licence contracts

Categories:
Dynamics 365 Finance
I have the same question (0)
  • André Arnaud de Calavon Profile Picture
    André Arnaud de Cal... 306,651 Super User 2026 Season 2 on at
    Hi,
     
    I haven't used subscription billing for the expenses myself. You can read more about subscription billing and configuration on purchase orders on Microsoft Learn. You can start here: Revenue and expense deferrals in Subscription billing - Finance | Dynamics 365 | Microsoft Learn
  • CU17101105-0 Profile Picture
    CU17101105-0 33 on at
    Hi Andre, 
     
    Thank you for the link, i was able to successfully set-up the expense deferrals for a supplier invoice associated  to a purchase order.
     
    Regards
    Helen
  • Verified answer
    André Arnaud de Calavon Profile Picture
    André Arnaud de Cal... 306,651 Super User 2026 Season 2 on at
    Hi Helen,
     
    Thanks for your update. Would you mind to mark the tickbox Does this answer your question on the replies that helped you? That will change the status of the question to Answered which is helpful for other community members with the same question.

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