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End-to-end D365 F&O implementation replacing legacy Dynamics AX

D365 F&O implementation project for a not-for-profit organisation in London that runs sport and leisure facilities on behalf of local authorities across the UK.

Solutions Architect•August 2024 - June 2025
Infographic showing key strategic drivers, scope and technologies used
High-level infographic showing key strategic drivers, scope and technologies used

Technologies Used

Dynamics 365 F&ODynamics 365 Finance & OperationsD365SSRSSQL Server Reporting ServicesBIBusiness IntelligenceDMFData Management FrameworkX++LogicAppsAX2012Project Management & AccountingAzure

Key Outcomes

  • •Replaced legacy end-of-support ERP with complete removal of previous heavy customisations, gaining significant system performance and trustworthy reporting
  • •Removed the high manual effort previously required for preparing daily journals through real-time General Ledger integration
  • •Improved tax accounting and VAT reporting, which was particularly challenging in the legacy system due to complicated exemption rules

Overview

This project involved the strategic migration of a large UK-based not-for-profit organisation from an end-of-life Dynamics AX2012 system to a modern Dynamics 365 (D365) Finance cloud platform. The project was not a classic upgrade project, but was organised and delivered as a full re-implementation, and it was part of a multi-year digital transformation programme designed to enhance operational efficiency, improve financial management, and support the organisation's mission.

Technical Approach

The solution leveraged the full Microsoft stack and selected third-party integrations:

  • Globalization Studio and Tax Calculation Service to address complex partial exemption and non-recoverable VAT requirements.

  • Power Platform: Using Power BI for self-service dashboards, Power Apps for mobile tasks like stock counts, and Power Automate for workflow extensions.

  • Azure Integration Services (AIS): A strategic integration platform using Logic Apps and Service Bus to connect D365 to external systems like the Flow leisure management system, Spektrix (bookings), and CoreHR.

  • ISV Solutions: Implementation of ExFlow for OCR invoice capture and LaserNet (FormPipe) for document management.

  • Data Strategy: Utilising an Azure Data Lake via Synapse Link for organisation-wide analytics and historical reporting.

Key Components

Key functional areas included:

  • General Ledger: Journal processing, period-end control, and multi-currency management.

  • Budgeting & Forecasting: Including budget control and cash flow forecasting. Note that a decision on using D365 Finance Premium or an external tool like Solver is pending.

  • Credit Management: Customer invoicing, collection activities, and revenue management.

  • Procurement: Vendor invoice management, payments, and the implementation of an Encumbrance process for better commitment accounting.

  • Fixed Assets: Managing asset acquisitions, depreciation, and tax management.

  • Project Management and Accounting (PMA): Tracking costs for Capital Projects for eventual capitalisation, as well as various Show & Event Projects, including management of complex VAT rules and income-sharing arrangements.

Challenges & Solutions

Challenge: High manual effort in financial processing. Staff spent excessive time on data entry — preparing journals, updating records, and building datasets for reports. Solution: Implemented automation via Azure Integration Services (AIS) and Power Automate to handle repetitive tasks.

Challenge: The organisation operates with a complex VAT profile including fully exempt, partially exempt, and non-recoverable tax scenarios. Solution: Adoption of the Globalization Studio and Tax Calculation Service to automate the VAT applicability matrix.

Challenge: Lack of real-time budget visibility for procurement. For example, it was difficult for procurement approvers to see the remaining project budget when they approve Purchase Requisitions (PRs), leading to a lack of real-time spend control and monitoring. Solution: Implemented the Encumbrance process (Commitment Accounting) to track financial obligations across years without recreating POs. The solution linked PRs directly to project budgets, triggering alerts to users and approvers about the remaining funds at the point of request.

Challenge: Fragmented reporting and data silos. The organisation suffered from a lack of self-service capability and difficulty accessing project and fixed asset data. Solution: By using Synapse Link to export data into Power BI, the project provided a "single version of the truth" and enabled staff to self-serve through interactive dashboards.

Results

  • Automation: Reduced the high manual effort previously spent on preparing journals, updating records, and building datasets for reports.

  • Flexibility & Scalability: Enabled process changes without extensive custom coding, ensuring the system can support organisational growth.

  • Data Access & Self-Service: Moved away from finance-controlled data to allow non-finance staff to self-serve real-time reports and dashboards.

  • Performance: Replaced an end-of-life, unsupported, cumbersome and slow legacy system with a performant, cloud-based platform.

  • Customisation: Removed legacy customisations and adopted a "standard-first" approach to leverage out-of-the-box Microsoft features rather than bespoke code.

Tags

enterpriseintegrationazuredynamics-365