Automate enforcement of audit policy rules to smoothen the flow of your business with the all new policy framework of Microsoft Dynamics AX 2012

Microsoft Dynamics AX 2012 is powerfully simple yet again. The NEXT big thing in the ERP market !!!

Microsoft dynamics AX has been offering new promising, powerful and exciting features and functionalities over the various releases which helps businesses in many different ways.

One such exciting functionality is the all new policy framework, which comes with Microsoft dynamics AX 2012. This framework helps business stakeholders to create and setup policy rules in several areas of business such as,

1. Employee expenditure controls.
2. Vendor invoices policies.
3. Procurements policies.
4. Document approval policies.
5. Organization audit policies etc…

The policy framework can be used to enforce rules for the Microsoft Dynamics AX 2012 users to help improve the business process. Below are the three key components of the robust policy framework in AX 2012.

1. Policy Types.
2. Rule types.
3. Policy rules.

A Policy type constitutes a collection of rule types which can be applicable to a particular feature area or a module of dynamics AX. For example, the Travel & Expense Management module, Procurement and Sourcing module etc.. A policy administrator role ( For e.g., the Procurement and Sourcing Manager) can be assigned with permissions to setup various policies for the procurements in the organization.

A Rule type categorizes the rules which can be that can be setup in a given module or feature area of dynamics AX 2012. For example, the Airlines and Hotel can be the rule types under the expenses management area. Different limits can be setup on these expense categories for employees in different positions of the organization. One good example of such a limit can be that the employees can incur a maximum of $1500 on airlines for their travel and they have to provide necessary justifications if their airlines expenses exceeds this limit.

The last component of this framework is the actual Policy rules which holds that essential data which defines how the policies will be enacted or evaluated. The example of limit on airlines expenses given above is a real-time example of a policy rule.

Leaving these core definitions and meanings of the policy framework, let us now take a look at a real policy rule in effect, inside Microsoft Dynamics AX 2012.

To demonstrate this, I will take an example of defining “A policy rule in the expenses management area where the employees can enter a maximum of $1500 when they submit an expense report for their airlines expenses and see how system will enforce them to enter a justification if they exceed this limit.

Follow the steps below.

1. Create and activate new policy under Travel and Expenses Management.

2. Assign the legal entities to which this newly created policies will be applicable. Please note that you need to define an organization hierarchy and then select companies or legal entities to be associated with this new policy. The beauty of this functionality is that, AX 2012 allows policies to be affected for the sister legal entities automatically when you define a proper organization hierarchy.

3. After you are done assigning the organizations, create the actual policy rule for the airlines expenses. Select Airlines on the left list and click Create policy rule button. Also note that, Microsoft Dynamics AX 2012 makes it possible for you to keep a complete audit trial of all your organization policies of the past and current and future. A policy once created can only be retired but not deleted.

Also, make a note of the various policy rule types which comes out of box with AX 2012.

4. Setup the data required for this policy rule which is as shown below.

The Policy now is created for this above scenario and make a note that the policy needs to be active for this to be in effect.

Let us now see how this policy comes into work when Ahmed Barnett, a Senior Manager in the Dynamics AX division of the organization enters his airlines expenses.

1. Ahmed logs into the Employee self-service portal and creates his expense report for the airlines expenses which he incurred when he was on site at a customers place and tries to submit it.

The policy framework’s warning icon gets activated and gives a message to the employee which we have setup back in the expense policy for airlines. (See above screen ).

Ahmed will now have to the go to the expense line again and enter a justification for this expense exceeding maximum allowed amount, for him to be able to submit the expense report.

The Microsoft Dynamics AX 2012’s policy framework is flexible enough to define any number of very simple to complex audit policies across your organization under the Expense Management, Vendor invoices, purchase orders etc. areas, there by allowing your admin staff and reviewers focus on their day-to-day work more, rather than spending time in evaluating business processes violations manually.

Please do not hesitate to contact me for any queries or comments about the policies in Dynamics AX 2012.

Till next time !!!!

Sandeep