Issue:
In the Indian localization of Dynamics 365 Finance, TDS (Tax Deducted at Source) is often applied on advance vendor payments. In practice, this results in minor rounding differences when reconciling one-to-many or many-to-many transactions, especially during bank reconciliation or settlement processes.
Currently, the system supports basic rounding off for simple one-to-one transactions. However, it lacks support for automatic rounding off or tolerance limits when multiple transactions are settled against one or more counterparts. This limitation causes system mismatches due to negligible rounding differences (e.g., 0.01 or 0.02 INR), preventing automated or even manual reconciliation in a streamlined way.
Business Impact:
- Delays in Bank Reconciliation: Reconciliation processes become cumbersome due to unmatched transactions with only rounding differences.
- Increased Manual Effort: Users are forced to identify and clear these minor mismatches manually, which is time-consuming.
- Compliance Issue with TDS on Advances: The Indian statutory requirement to deduct TDS on advance payments causes rounding variances between the payment and final invoice.
- Low Usability of Modern Bank Reconciliation Feature: Limits the full potential of the modern bank reconciliation framework due to unmatched values within tolerable limits.
Proposed Feature:
Introduce a configurable rounding off/tolerance feature that supports:
- One-to-Many and Many-to-Many Transaction Matching:
- Allow minor differences (configurable limit, e.g., 0.05 INR) to be tolerated during settlement or reconciliation.
- Automatically match such transactions if the variance falls within the defined threshold.