When the username in M365 is changed through a UPN change in Azure, the new username is able to sign in to the D365 F&O environment with the new user. However, the new user is not automatically updated in the system administration users page and a manual username change is required from the old user (which becomes an alias) to the new user (which becomes the main user).

This causes issues with changing user options in F&O because the username is not synced automatically to F&O while the Azure security feature is not enabled for this environment.