Overview of the Discount and Fee Feature

sribatsapatra1
Feb 24
3 min read

This article provides an overview of the setup of the Discount and Fee feature in Microsoft Dynamics 365 Project Operations. Organizations may apply discounts to contracts with customers or charge additional fees, such as administrative fees. Project Operations allows defining discount and fee percentages at the project quotation or contract line level. Upon transaction generation and approval, the system applies the appropriate discounts or fees based on the contract line setup and updates the actuals accordingly. This feature is applicable to Time and Material business processes. Once enabled, the Discount and Fee feature cannot be disabled, as transactions may have been processed based on the applied percentages.

Prerequisites

To use discounts and fees in Project Operations, enable the Discount and Fee feature in the system.

Project Quotations

Project quotations can be created and shared with customers, including one or more tailored quotation lines. For Time and Material type project quotation lines, the Discount percentage and Fee percentage fields are available for editing. The extended amount on the project quotation line reflects the discounts and fees based on the entered percentages.

Steps to Apply Discounts and Fees for Project Quotations

Navigate to Sales > Sales > Quotes.
Select New to create a project quotation.
Create a new quote
Fill in the Name, Prospect or Customer, and Contracting unit fields along with other mandatory details.
On the Quote lines tab, select Add New Quote line.
Set the Name field.
In the Billing method field, select Time and Material.
The Discount percentage and Fee percentage fields will appear.
Enter a value in the Quoted amount field or create quotation line details on the Quote Line Details tab.
Set the Discount percentage field and/or the Fee percentage field.
The system calculates the Discount amount, Fee amount, and Extended amount based on the specified percentages.
Select Save and Close to finalize the quotation line page.
The Profitability Analysis and Total Revenue fields are updated to reflect the discount and fee amounts.

Create Project Contracts from Quote

Project contracts can be created manually or from project quotations, including tailored contract lines.

Steps to Apply Discounts and Fees to Project Contracts

Navigate to Sales > Sales > Sales Quote.
Select the quote record created above and click on Activate Quote. Mark the quote Closed as won.
Once the quote is Closes as won, a Project Contracts gets automatically created.
Open the Contract record. Navigate to Contract Lines > Open Contract Line record
The Discount percentage and Fee percentage fields will appear automatically inherited from Project Quote.
The Contract performance and Total Amount fields are updated to reflect the discount and fee amounts.

Note: If your organization creates Project Contract directly instead of going through Project Quote process, follow the same steps mentioned in section "Steps to Apply Discounts and Fees for Project Quotations".

Actuals

Actuals capture results from all transactions performed or generated in Project Operations. They can be updated through timesheets, expenses, material usage, journals, or project invoice processes. When approved, the system generates actuals of the Unbilled Sales type for contracts with applicable discounts and/or fees, adjusting the extended amount accordingly.

Project Invoices

Project invoices are used to bill customers and can include multiple invoice lines. When creating an invoice for Time and Material transactions, if Unbilled Sales transactions with discounts and fees are selected, the system generates an invoice reflecting these amounts. Invoice lines include separate fields for discount and fee amounts. If quantity changes are made, the discount and fee amounts adjust accordingly. After confirmation by the project manager, Unbilled Sales actuals are reversed, and new Billed Sales actuals are generated to reflect the updated discounts and fees.