I tried to set the Alert function and I am using AX 4.0 sp1. But that is not working. Someone help me how can I use Alerts function in ax 4.0. what are the steps for that.

Alerts are generated as part of a notification system that helps users track critical events in Microsoft Dynamics AX.

The setup prerequisites for Alerts depend on what features you want to apply.  Number sequences and the Alerts batch processing must be set up in the Basic module before you can start using Alerts. Apart from these mandatory setup requirements you can enable e-mail alerts, which is an optional feature.

Prerequisites
Number sequences must be set up in the Number sequences form before you can start using Alerts.

Batch processing
Batch processing must be set up for alerts to be delivered.
1. Configure the Due date alerts form to batch process all events caused by due dates. The batch process generates an alert when an event matches the rule conditions.
2. Configure the Change based alerts form to batch process all change-based events (field updates, records deleted, or records created) that have occurred since batch processing was executed the last time. The batch process generates an alert when an event matches the rule conditions.

When setting up batch processing, consider whether you want to set up a batch-processing window. The batch-processing window is optional, and you can set up the batch process without applying the batch-processing window.

E-mail alerts
The e-mail alerts functionality enable users to receive alerts as e-mail messages. The e-mail functionality is optional, so you can use the Alerts feature without applying the e-mail alerts functionality. If you do not set up the e-mail functionality, users can receive their alert as pop-ups only.

1. Configure the parameters that Microsoft Dynamics AX needs to communicate with an SMTP server on the E-mail parameters form.
2. Define a valid recipient e-mail address on the Options... form.
3. Set up an e-mail identification for Alerts, a sender e-mail address and an e-mail template on the E-mail templates form.

Drill-down links and the drill-down target for e-mail alerts
If you want to use the e-mail functionality, consider whether you want to enable drill-down links and the retry schedule. These features are optional, and you can use the alert e-mail functionality without adding drill-down links in the e-mail template and without setting up a retry schedule for the e-mail messages.

Drill down links can be applied in the e-mail template on the Alert parameters form to enable users to drill down to alerts, alert rules or the alert origin from an alert e-mail message.

Drill-down links in e-mail alerts are optional and you can set up an e-mail template and use the e-mail alert functionality without using drill-down links. When you insert drill-down links into the e-mail template, you should also choose a drill-down target value for the links. The primary purpose of the drill-down target is to prevent users from drilling down to a wrong Microsoft Dynamics AX database in situations where they can receive alerts from two different databases. The drill-down link in alert e-mails must drill down to the database where the event occurred and the drill-down target value identifies the database.
If users only receive alerts from one database, you need not change the default setting of the drill-down target (= 0).

Retry schedule for e-mail alerts
In the retry schedule on the Retry Schedule form, you can define how many times the system should try to send an e-mail message that has failed to be sent and the time period between the retries.
The retry schedule setup is optional and you can use the e-mail alert functionality without setting up a retry schedule.