This article describes the cases that require a reconciliation process when using Orders for revenue recognition.
In some scenarios, ensuring that Order TCB metrics match the actual amount billed will be important. This is, in particular, likely to arise in cases where Order Metrics are used for revenue recognition. If that applies to your business, you should be aware of certain settings changes that may cause differences between the Order TCB values that were originally calculated and the actual amount that is billed.
Before making these types of setting changes, you should take any steps that are necessary to account for those differences.
Below we describe the types of changes that may have this effect, and the steps you may wish to take in order to address any differences that result.
Change of taxation rates after any order has been created might lead to differences between your order metrics and the actual billing amount. Taxation rate changes do not trigger past order metrics (tax amount) to be recalculated. To resolve the differences, reconcile the tax amount from the past orders.
Changing the below Billing Settings after any order has been created might lead to differences between the contracted billing metrics for the order and the actual billing amounts. Changing one of these settings might, therefore, require a reconciliation process (e.g., using billing preview) to account for these differences.
- Define Billing Rules
- Enable credit back for removing or canceling one time charges?
Prorate recurring charges for a partial period?
Bill recurring charges for a partial month (with monthly based billing periods)?
- Bill recurring charges for a partial week (with weekly based billing periods)?
- Bill usage charges for a partial month (with monthly based billing periods)?
- Bill usage charges for a partial week (with weekly based billing periods)?
- When prorating a month, assume 30 days in a month or use actual days?
- When prorating periods greater than a month, prorate by month first, or by day?
- Include usage from child accounts when billing?
- Round and determine a price for usage records individually when rating usage charges?
- Calculate taxes using information from Customer Account of
Determining Billing Differences
The Billing Preview Run API will show expected billings for future periods. If you do need to change one of the settings described above, you can use the Billing Preview Run API to get the expected billing amounts before and then after your settings change. This will show how much, and where specifically, your settings change will impact actual billing amounts.