Files with Dynamics 365 ERP MCP (preview)

[This article is prerelease documentation and is subject to change.]

File support in the Dynamics 365 ERP MCP server enables powerful process automation and agentic experiences for document-centric business processes in Dynamics 365 finance and operations apps. The MCP server lets an AI agent exchange files with the application in two directions: it can return large query results, exported reports, and existing attachments as embedded resources to the language model client, and it can accept file content from the client and attach it to a record in the application.

The MCP server supports two categories of file and attachment operations:

• Output scenarios - the server returns file content or large result sets to the LLM client as an MCP embedded resource.
• Input scenarios - the server accepts file content from the client and attaches it to a finance and operations business record through Dataverse custom APIs.

Together, these operations let an agent read reports, download exported files, and programmatically attach documents to finance and operations records without manual user interaction.

This article describes the supported scenarios, the tools and APIs that back them, the size and timeout limits that apply, and the validation performed on each request.

Output scenarios

Output scenarios occur when the MCP server sends binary or large-text content back to the LLM as an MCP embedded resource. There are three triggers:

• data query tools
• an action execution tool
• form interaction tools

Prerequisites

The following prerequisites must be met to enable output scenarios for files with the Dynamics 365 ERP MCP server:

• Finance and operations apps must be version 10.0.48 or later.
• Enable the Dynamics 365 ERP MCP server in your environment. For more information, see Use Model Context Protocol for finance and operations apps.
• In Feature management, enable the Enable output menu items for MCP feature.

SQL and OData data query tools

Both data_find_entities_sql and data_find_entities accept an optional Boolean parameter, returnAsResource. When you set this parameter to true, the query result JSON is returned as an MCP embedded resource instead of inline text. This change raises the allowed response size from roughly 160 KB to 5 MB, enabling agents to work with greater response sizes.

The MCP response with the file resource comes in the following shape:

Constraints

• Inline responses are capped at 160,000 characters (~160 KB). Exceeding this limit returns a ResponseTooLarge error.
• Resource responses are limited to 5 MB.
• When a query returns an error, the response is always returned inline regardless of returnAsResource.

Typical flow

1. The agent calls data_find_entities_sql with a SELECT statement and returnAsResource=true.
2. The MCP server executes a query and serializes rows to JSON, formatting it to be readable to the agent.
3. The agent receives a summary text block followed by a resource block containing the full JSON.
4. The agent reads the resource to extract individual records.

API action tool

The api_invoke_action tool also accepts returnAsResource. When you set this parameter to true, the action response is returned as an embedded resource, mirroring the query-tool pattern, and raising the allowed response size to 5 MB. The same size limits and error-handling rules apply as for the query tools. If the inline limit is exceeded, the error's fix field suggests setting returnAsResource=true.

Form tools with SSRS reports and output menu items

When using form tools in the MCP server, the agent has the ability to select a button that prints a report as an output menu item. The MCP server can run these actions, receiving the output file, appending it to the tool response as an embedded resource alongside the updated form state.

When the agent opens a form with FormStyle = "Report" for SSRS reports, the MCP server detects the McpReportForm pattern and injects guidance instructing the agent to use the report's export buttons. Clicking an export button triggers the download path described in the previous section.

The MCP response has the following shape:

For example, an agent can run the vendor aging report with a prompt like "Run the vendor aging report, aging as of today's date." The agent then uses form tools to find the form and run the report, creating a PDF file. The MCP tool response then includes a file reference for the document, similar to the below response. The agent then summarizes the results of the file, and includes a link to download the PDF file.

[
  {
    "text": "Button __TimerForAsyncTaskPolling was clicked. File 'VendorAgingReport_04242026.pdf' was downloaded.",
    "type": "text"
  },
  {
    "text": "{\"SessionId\":\"6493e93a-a079-41eb-b53f-986fef39286e\",\"Result\":\"Button __TimerForAsyncTaskPolling was clicked.\",\"Messages\":[],\"FormState\":{\"Name\":\"No form is open\",\"Summary\":\"No form is open\",\"Form\":{},\"Buttons\":[],\"Links\":[],\"Guidance\":[\"No form is currently open. To open a new form, use the $form_open_menu_item tool.\"]},\"MCPActivityId\":\"f5de2c35-d182-0004-0051-acf682d1dc01\",\"DeepLinks\":[]}",
    "type": "text"
  },
  {
    "file": {
      "$kind": "FileDataValue",
      "value": {
        "$kind": "ConversationFileReference",
        "value": "5a0c74a9-c4aa-4189-a6e7-8cfa08293ec4"
      }
    }
  }
]

Input scenarios: files attached to records

Input scenarios involve the agent obtaining file content, from the user or from a prior output scenario, and attaching it to the ERP business record through custom APIs. The custom APIs are added to the agent through a flow in Microsoft Copilot Studio. With this feature, you can upload files referenced in your agent as attachments to records in the ERP system. For example, uploading PDF documents of orders to attach them to the related record. You can do this using Copilot Studio capabilities for working with files in your agent.

The action to perform the upload isn't built directly into the MCP server. A flow connecting the record to the finance and operations environment is used for the file upload, and needs to be added as a tool in the Copilot Studio Agent. However, use of the flow assumes the Dynamics 365 ERP MCP server is added as a tool in the agent to get details of the record to which the file will be attached.

Configure attachment inputs

1. On the Tools tab of the agent, select Add a tool.
2. In the Add tool dialog, select the Flow filter. Search for and add the Add an attachment to a record in ERP flow.
3. In the Inputs section, add the contentBytes input:
   • Select the Add input action.
   • Select the contentBytes input.
   • In the Fill using field, select Custom value.
   • In the Value field, select the ellipses button.
   • In the Choose a variable dialog, select the Formula tab, and enter the following formula: First(System.Activity.Attachments).Content.
   • Select Insert.
4. Add the name input:
   • Select the Add input action.
   • Select the name input.
   • In the Fill using field, select Custom value.
   • Select the ellipses button on the Value field.
   • In the Choose a variable dialog, select the Formula tab, and enter the following formula: First(System.Activity.Attachments).Name.
   • Select Insert.
5. Save the tool.
6. If you didn't already, add the Dynamics 365 ERP MCP server as a tool in your agent by following the steps outlined in Build an agent with Dynamics 365 ERP MCP.

You can then begin prompting the agent to attach files you add to your agent to records in the ERP.

Known limitations