1. Implementing Subscription Management
  2. Use Milestone Billing

Use Milestone Billing

Use a milestone billing template when you want to bill customers when an event happens or when using an ad-hoc date.

You can only associate an MBBRR template with a one-time charge of a subscription product in a subscription. You can select the template and edit it, according to the requirements of the subscription. The MBBRR template assigned to a one-time charge in a subscription product is called an "MBBRR template instance" or a "milestone template instance". Any changes to an MBBRR instance won't modify the MBBRR template that's been established in the Subscription Configuration screens. If you have multiple one-time charges, then you can assign the same or a different MBBRR template to each of them.

Steps to Use Milestone Billing in a Subscription

  1. Create a subscription and select a subscription product (not a coverage) with a one-time charge. See Create Subscriptions.
  2. In the Template field, select a milestone billing template.

    The check boxes Enable milestone based billing and Enable milestone based revenue recognition reflect the values of the MBBRR template selected. These values are set by your administrator.

  3. In the Comments field, capture any comments as you update an event or enter a completion date. For instance, you can capture who approved the milestone or add document references.
  4. Delete lines as needed.
    Note: The Delete icon is enabled only when the subscription is in Draft status.
  5. In the Expected Completion Date field, enter the date of the milestone. The date should be within the subscription product start and end dates.
  6. Enter a Completion Date for the milestone, which also should be within the subscription product start and end dates.
    • The completion date for revenue recognition becomes satisfaction date for the revenue event. This is date the completion of a specific event, when the completion date is captured. At this point, the milestone row is made non-editable. For example, if you have created that row by mistake and don't want it, then you have to enter another row with the same completion date and a negative percentage and save it. This will nullify the impact in Revenue Management.
    • The completion date for a billing milestone date, plus the billing offset value in days, is the interface date in the billing schedule lines. You can't change the completion date after it's entered and saved.
  7. Enter a Billing Offset for billing milestones. Use the billing offset to indicate the number of days before or after the completion date on which the interface date lies.
  8. You can alter Percentages and add new events when an MBBRR template is used. The total of the percentages should be 100. You can use percentages to reverse revenue (see the example later in this topic). See the next section, Considerations When Using Percentage, for concepts around using percentage.
  9. You can update Source Reference, as needed, with subscriptions in any status.
  10. Save and activate the subscription.

If you change the milestone template while working on that milestone template instance, then the data of the previous milestone template is discarded.

Note: You can't reverse revenue for more than what has been recognised, until that milestone completes.

Considerations When Using Percentage

Keep in mind these considerations when using percentage:

  • The percentage for reversing a completed revenue milestone is always a negative value. The new line that reverses the event should have the same event name, completion date, and negative percentage. It should also have the same absolute value as the positive percentage entered earlier. You then need to enter new rows with new events and completion dates, and ensure that the total percentage is 100.
  • Percentage is the field that's used to split a charge amount after the charge discounts corresponding to the milestone event.
  • Percentage values should be between 0 and 100 for billing milestones.
  • Percentage values should be between -100 and 100 for revenue milestones.

Examples of Reversing Revenue

Here's an example of reversing revenue using a percentage:

Let's say you have a subscription product with a start date of 1-Jan-2021 and an end date of 30-Oct-2022. The line has three milestones: SIT, UAT, and GOLIVE. You can't enter a negative percentage of 70 on 1-Jul-2021 as ABS(-70) is > 33 + 34.

For all rows, the type is Revenue and the source is Manual.

This table shows more details of this example:

Name Percentage Completion Date
SIT 33 10-Jan-21
UAT 34 30-Jun-21
GOLIVE 33
UAT -70 1-Jul-21
UAT1 70

In this example, the revenue reversal is allowed on 1-Jul-2021:

Name Percentage Completion Date
SIT 33 10-Jan-21
UAT 34 30-Jun-21
GOLIVE 33
UAT -60 1-Jul-21
UAT1 60

In this example, the revenue reversal isn't allowed on 10-Jul-2021, since as ABS (-60) > 33+34-20+10:

Name Percentage Completion Date
SIT 33 10-Jan-21
UAT 34 30-Jun-21
GOLIVE 33
UAT -20 1-Jul-21
UAT1 10 2-Jul-21
UAT2 10 30-Jul-21
UAT1 -60 10-Jul-21
CUTOVER 60