The client Regional settings affect date and time
interpretations within Dynamics NAV. The Region is easily set when
using the Classic or Role Tailored Client (RTC). When using a Web
Service its also easy, if you know how (like most things in
life).
I have an application that takes Point-of-sale (POS)
transactions from Advance Retail and passes them into Dynamics NAV.
A problem arose where transactions for early one morning (say
6:00am 21st Jan 2011) where appearing in NAV with a
Posting Date of the day before (20th Jan 2011). The
problem was the client date time was based upon GMT +10 but the Web
Service was working in UTC time.
The default Time Zone is UTC. -not very helpful when I live in
Sydney Australia.
Settings within the client application making the Web Service
call have no effect on the web service.
Within the CustomSettings.config file you'll find

In my case I want to use Australian Eastern Standard time.

Restart the web service and the Date and Time is now correctly
interpreted.
Oh, and if you need the middle-tier (NST) to operate in
different Time Zones, just run up another Web service. (see another
post on how to do this)