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Manage Revenue Recognition Rules

Revenue rules are instances of revenue rule models. These rules are associated with product rate plan charges. Rules help manage revenue recognition on subscription charges. This article explains how to manage a revenue rule, including how to associate the rule with a charge.

Revenue Rules

You can do the following when managing revenue rules:

  • View the configuration of a rule.
  • Create or update a rule. 
  • Activate or deactivate a rule so that it can be applied to charges.
  • Delete a rule from the list.

Zuora provides the following pre-configured revenue rules:

  • Recognition upon invoicing
  • Recognition daily over time

See Revenue Rule Models for descriptions of rule models and for steps on how to enable them for use.

When is a Revenue Rule In Use?

A revenue rule is in use when it is used by a subscription charge or used in a revenue schedule. A revenue rule is not in use if it is deactivated or associated with a product rate plan charge, but used by a subscription or in a revenue schedule.​ The status of a rule determines if you can update, delete, or associate the rule with a charge. 

The following table summarizes when you can change the status of a rule, edit, or delete a rule.

Rule Status Is Associated with Product Charge? Is in Use? Can Change Status? Can Update Rule? Can Delete?
Active File:Z_Media/xmark.png File:Z_Media/xmark.png Can Deactivate File:Z_Media/checkmarkGreen_xsm.png Must Deactivate First
Active File:Z_Media/checkmarkGreen_xsm.png File:Z_Media/checkmarkGreen_xsm.png Cannot Deactivate File:Z_Media/xmark.png File:Z_Media/xmark.png
Active File:Z_Media/checkmarkGreen_xsm.png File:Z_Media/xmark.png Cannot Deactivate File:Z_Media/xmark.png File:Z_Media/xmark.png
Deactivated File:Z_Media/xmark.png File:Z_Media/xmark.png Can Activate File:Z_Media/checkmarkGreen_xsm.png File:Z_Media/checkmarkGreen_xsm.png

Manage a Revenue Rule

You can create revenue rules, change rule configurations, activate, deactivate, or delete revenue rule.

Navigation: Click Finance > Revenue Recognition Rules.

Manage Revenue Rules

The following table describes options available when managing rules:

Column Description

Revenue Recognition Rule

The rule name.

Recognition Model

A rule model is a template with recognition logic.

The following rule models are supported:

Billing

  • Daily recognition over time
  • Full recognition on a specific date
  • Full recognition upon invoicing
  • Manual recognition
  • Monthly recognition over time

Custom

The following rule mode is supported:

  • Unlimited recognition

Active

Status of the rule.

checkmark A check mark indicates the rule is activated.

 x-mark An x-mark indicates that the rule is deactivated and must be activated in order to associate with a product rate charge. 

Actions

Click edit to change the rule configuration. See Components and Configuration Options for configuration option details.

Click activate or deactivate to change the status.

Click delete to delete the rule. You can only delete a deactivated rule.

Create a Revenue Rule

You can create up to 200 unique revenue rules in Zuora

From the Manage Revenue Recognition Rules page:

  1. Select a revenue rule model from the drop-down list.
  2. Click create new revenue recognition rule.
  3. Configure the rule. See Components and Configuration Options for configuration option details.
  4. Click update rule to save changes.

Activate, Deactivate, and Delete a Revenue Rule

You can view the status of a revenue the Manage Revenue Recognition Rules page. The status of a revenue determines whether you can change the status, update the rule, or delete the rule.

  • Click activate or deactivate in the actions column to change the status. You can deactivate a rule when it is not in use.
  • Click delete from the actions column. You can delete a revenue rule that is deactivated. 

Associate a Revenue Rule with a Charge in your Product Catalog

You can apply a revenue rule to each product rate plan charge by editing the charge. By default, all product rate plan changes are associated with the Recognize upon invoicing rule.

Associate a rule with a product rate plan charge

The revenue rule that you associate with the product rate plan charge dictates the revenue recognition method, and is tracked and managed by a revenue schedule.

The revenue rule must be active to associate with a product rate plan charge.  

  1. Navigate to  Products > Product Catalog, and select a rate plan. 
  2. Click edit next to the charge you want to associate with a recognition rule.
  3. In the Finance section, select a rule from the drop-down list. 
  4. Assign accounting codes for recognized revenue and deferred revenue. 

See product catalog for more information on how to access and create products, product rate plans, and charges in your product catalog. See accounting codes for more information on how to create accounting codes in your chart of accounts.

See Revenue Schedules for more information on how revenue rules can assist with creating revenue schedules and distributing revenue.

Override the Revenue Rule on a Subscription Charge

You can override the revenue rule applied to the product rate plan charge when creating the subscription. A subscription charge is the charge for a product rate plan.

For example, if you have two rate plans in a subscription, and each rate plan has three charges. This subscription has six charges (2 rate plans multiplied by 3 charges). You can override any of the six subscription charges while creating the subscription.

To override the revenue rule on a subscription charge through the SOAP API, you can use the RevenueRecognitionRuleName field on the RatePlanCharge object.

To override the revenue rule from the Zuora UI, click the charge name in the Products & Charges section. Scroll to the Finance section and select the revenue rule from the drop-down, as shown in the following figure.

Overriding the revenue rule when creating a new subscription

Last modified
22:10, 20 Mar 2017

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