FaceTime HD camera not working with Lync

I finally managed to convince IT to get me a Mac instead of the standard (cringe) Dell laptop , but we can't make the enterprise MS Office 365 / Lync video work. This is frustrating for all concerned and threatens to hinder our efforts to expand the Mac pool. There are other bugs in Lync (2011 version is most recent apparently). Skype and Photobooth seem to recognize the FaceTime HD camera without a problem.
There is no System Preferences pane for video (seems a bit strange) and the FaceTime HD camera doesn't appear in the options on the main Lync panel. No video pane or selection for Lync prefs either (see below - seems to be the latest version). Nobody at MS seems to care enough to fix this problem that must be at least 2 years old given the release date. Any help from the Mac community?

Same Issue in MB Air. I have Lync 14.0.7, but no video at all.

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