“No business would mind having an internal auditor who never sleeps, who never forgets, who never misses an error, and who never gets weary of checking figures.” If you are using Microsoft Dynamics 365 Business Central, you already have a silent internal auditor. 

Business Central has its eye on all the transactions, confirming all the entries, monitoring all the changes, and ensuring that all the financial and business information remains accurate, compliant, and traceable. It doesn’t attend meetings, but it doesn’t have to write reports either, because there’s something even better: protecting the business from mistakes, from fraud, from bad data. 

Let’s go through the details of how Business Central functions in the background as the silent internal auditor. 

1. All Transactions Are Fully Traceable 

Each sales invoice, each purchase receipt, each inventory adjustment, and each journal entry generates a sequence of records, like: 

  • G/L Entries 
  • Item Ledger Entries 
  • Commodity Values 
  • Customer Ledger Entries 
  • Vendor Ledger Entries 
  • Detailed Ledger Entries 

Each one connects to: 

  • The person posting i.e. user 
  • The date and time 
  • The document number 
  • The original document 
  • The Applied entries 
2. Permission Sets Enforce Segregation of Duties 

One of the basic auditing concepts is the segregation of duties, where the person responsible for recording the transaction should not be the same person who approved it. Business Central ensures this with: 

  • Permission Sets  
  • User groups 
  • Approval Workflows 
  • Posting restrictions 

So, you can control who, 

  • Creates Vendors, Customer, Items 
  • Enter invoices 
  • Approves transactions 
  • Post Payments 

This ensures that neither forgery nor errors occur. 

3. Posting Groups Prevent Accounting Errors 

Posting groups are the financial ruling engine for BC. They determine which G/L accounts to debit/credit on: 

  • Selling an article 
  • Purchasing inventory 
  • Recording COGS 
  • Paying a vendor 
  • Receiving cash 

“If it is incorrectly configured, it will result in posting being blocked by BC.”

It means that the user cannot accidently post the inventory to the wrong balance sheet account or accidently post revenue to the wrong line item. 

4. Change Logs: What and Who made the changes. 

Ever wonder who: 

  • Altered the customer’s payment terms 
  • Modified this item cost 
  • Updated the G/L account 

It is all answered in the Change Log. It monitors: 

  • Old value 
  • New value 
  • User ID 
  • Date and Time 
5. The Posting Preview lets you See the Impact of the Transaction Before It Occurs 

The Posting Preview facility will allow you to post your content before posting. That is: 

  • What G/L accounts will be affected 
  • Debits and credits will be generated 
  • What will the generated entries include 

This enables accounting teams to examine and approve any transactions before they are recorded. Auditors appreciate this feature. So do CFOs. 

6. Corrections Are Never Hidden 

In Business Central, you never delete financial history. If something is wrong, you: 

  • Reverse it 
  • Correct it 
  • Made a new posting 

This leaves an observable trace of: 

  • Original entry 
  • Reversal entry 

Correction Exactly as the auditors wanted it. 

7. All Inventory Movements Are Fully Logged 

Every item movement creates: 

  • Item Ledger Entries 
  • Value Entries 
  • Reservation Entries 
  • Tracking entries (lot/serial) 

This enables tracing for: 

  • From where the inventory came from 
  • Where it went 
  • Who was the customer 
  • Which vendor sold it 
  • What it cost 

It becomes easier to detect shrinkage, write-offs, and discrepancies. 

8. Dimensions Unveil Financial Transparency 

Dimensions guarantee the following tags on each transaction: 

  • Department 
  • Project 
  • Location 
  • Channel 
  • Cost centre 

Thus, costs and revenues cannot hide in the wrong bucket, and accountants have complete visibility regarding the movement of funds within the business. 

9. System Validations: Protect against Bad Data 

Business Central prevents transactions from happening if they violate certain rules: 

  • Missing posting groups 
  • Invalid VAT/Tax setup 
  • Incorrect dimensions 
  • Closed periods 
  • Wrong document status 

It’s like what an internal auditor might say: 

“This doesn’t meet policy, you can’t proceed.” 

10. Reports Are Always Reproducible 

Since everything is recorded as ledger entries, you can always: 

  • Prepare a trial balance 
  • Recreates inventory valuation 
  • Recalculate COGS 
  • Reproduce any financial statement 

Nothing hinges on the manual spreadsheet. This would be an audit and compliance professional’s dream come true. 

Conclusion: The Always-On Finance Protector 

You may not notice it, but Business Central is always working in the background: 

  • Enforcing controls 
  • Data validation 
  • Tracking changes 
  • Preventing errors 
  • Protecting Financial Integrity 

Business Central never forgets. It never misses a check. “That’s why it is largely your silent internal auditor.”