Designing Your Membership Types

This section discusses the options to consider when designing your service credit membership types.

First consider the type of unit that your membership's service credit events represent.

• Is it related to a currency? If so, ensure that your currency is correctly defined on the currency page.
• Is it a non-currency unit, such as movies, points or miles? If so, you need to define the unit on the credit unit page.

Next, consider other behavior that your membership may exhibit.

• Should your membership calculate an overall balance ?
• Will miscellaneous financial transactions be created for you membership over its lifetime? If so you may need to link a service agreement to your membership.
• Should events linked to your membership reference a fiscal year ?

The table below illustrates three types of memberships: one for capital credits, one for frequent flier miles and one for free pay-per-view movies.

The following points explain the settings for each membership above:

• The capital credit membership uses a currency of US dollars for its units. Over time, capital credits are allocated and retired. The overall balance of the credits and debits should be calculated and displayed for information purposes. It is common for the allocation and retirement of capital credits to affect the GL, and as a result, a membership SA is required for posting these financial effects. Finally, in a capital credit situation, the allocation is typically related to a specific fiscal year. When calculating and displaying balances, the balance for each fiscal year must also be available. As a result, the fiscal year must be set to required.
• For the frequent flier membership type, a separate membership type must be created for each different airline. This is because a separate membership must exist for each separate airline in order to keep track of the accumulated miles correctly. The membership type does not have a balance because the accumulated miles are interfaced to the airline and the airline keeps track of the balance. In this example, no SA is required because an assumption is being made that the creation of frequent flier miles does not affect the GL. (Accumulating miles is no liability or expense for the company. The miles are simply accumulated on behalf of a third party.) Finally, the frequent flier miles do not need to indicate a fiscal year.
• For the free pay-per-view movies membership, we assume that the credits are redeemed from within the system. For example, perhaps a calculation rule calculation algorithm or pre-processing calculation rule redeems the free pay-per-view movies over time as customers are billed for the movies. As a result, the membership should have a balance. In this example, no SA is required because an assumption is being made that any affect on the GL is posted at the time the free movies are redeemed (i.e., when calculating a bill). (This is just an example. It's possible that you may want to post to the GL when free movies are accumulated to mark a payable for the company.) Finally, free pay-per-view movies do not need to indicate a fiscal year.

More options must be considered for each membership type.