Billing licences into contracts

Tenvara keeps a recurring line on the customer's contract for each mapped subscription, and changes it when the subscription changes. Because each month's invoice run bills from the contract, licence changes reach your invoices (and your Xero or QuickBooks ledger, if it is connected) without anyone retyping them. See Invoice runs.

What gets billed#

A subscription is billed when it is:

• mapped to a customer,
• not marked Do not bill this,
• in force (Active or Suspended), and
• recurring.

A subscription on Trial or Pending is current, so it shows in the lists, but it is not billed and its seats are not counted as billable units until it is active. Cancelled and expired subscriptions are never billed: a cancelled one's line ends after the day it was cancelled.

It goes on the customer's contract in force today. If there is none, it goes on a contract starting later, and failing that on a draft contract. Tenvara never creates a contract by itself: a customer with no contract at all shows as Cannot bill and raises an alert.

The line bills seats x price:

• Price is the mapped catalogue item's price for the subscription's own commitment term and billing (a month-to-month subscription takes the monthly price, an annual one billed monthly the annual billed monthly price, an annual paid upfront one the yearly price), converted only when the item has no price for that combination. When the product is not mapped to an item, it is the source's price. See The catalogue.
• Frequency follows the billing term: monthly terms bill monthly, and annual, two year and three year terms bill annually. The contract line keeps the term, and a line on another term is reported as differing, for example "Annual commitment (should be Monthly commitment)".
• The VAT rate, item code and account code come from the catalogue item.

Cost comes from the source, else the catalogue item. When neither gives one, the cost is shown as not known, never as free, and totals leave it out and say how many they skipped. When the catalogue cost for the subscription's own term differs from what the source charges, the subscription says so: annual is compared with annual, so a month-to-month subscription is never flagged against an annual price.

Who bills a subscription#

Not every subscription goes on your invoices. Some distributors, Pax8 among them, can invoice your customer directly at their own sell price, and some licences are included in a contract's fee. Billed by says which:

• Us, on our invoices: on the customer's contract, as described above.
• The distributor, on its invoices: nothing goes on your contract. The row shows By and the source's name, Billed is the distributor's price a seat times the seats a month, and Margin is that less your cost.
• Included in a contract: within a contract's fee, not billed on its own. It shows In a contract, with no Billed or Margin, and never counts as not billed.

Set it on the licence source (Settings > Integrations, the source's Edit, Billed by). A new Pax8 source starts as the distributor, every other source as you. A customer can say otherwise with the picker beside Update billing automatically on its licences, and one subscription with Billed by in its panel: the subscription's choice wins, then the customer's, then the source's. A source set to the distributor bills only the subscriptions it gives a price for; the rest stay yours.

Changing who bills a source, customer or subscription moves lines on or off contracts straight away (as the customer's automatic updates allow) and is recorded on the activity timeline.

Billing states#

Each subscription shows its billing state in the list's Billing column and in its panel:

How changes are charged#

Changes are billed from the day they happened, not the day someone noticed:

• Monthly lines: the old line ends the day before the change and a new line starts that day. The part month is charged pro rata on each, and the invoice shows both lines.
• Quarterly and annual lines: these are charged in full at the start of each period, so the change starts at the next period. The old line ends the day before.
• Cancellations end the line after the day of cancellation.
• Do not bill this ends the line the day before.
• A line that has not started yet is updated in place, or removed.

Only one line per subscription is kept in step at a time. The lines it replaced keep their dates as billing history. If the contract already has a matching line (for example from an accepted quote, for the same catalogue item or with the same description), Tenvara takes it over rather than billing the seats twice.

Note: Distributors often charge their own pro rata amount for seats added part way through an annual term. Tenvara leaves that to the person billing; the change log shows the date and seats so you can add a one-off charge.

Automatic or by approval#

Each customer has an Update billing automatically switch, on by default.

• On (Automatic): changes go on the contract by themselves, as soon as a sync or seat change records them.
• Off (By approval): changes wait. They are logged as Waiting, the subscription shows Differs, the unbilled alert is raised, and the contract is not touched until someone applies the change.

Use approval for customers who sign off licence changes, or where you want to check each change before it reaches an invoice.

Apply waiting changes#

For one subscription:

1. Open it on the Subscriptions tab of Sales and billing > Licences (the Unbilled view lists every one that needs it).
2. Select Apply to billing in the panel.

For every waiting subscription of a customer:

1. Open the customer, choose Commercial, then Contracts and time.
2. In the Licences section, the banner says how many subscriptions are not billed as the distributor says, and why.
3. Select Apply to billing in the banner.

Applying replays the waiting changes in the order they happened, each from its own day with the seats it left. For example, going from 10 seats to 5 on the 5th and back to 10 on the 20th bills 5 seats in between.

Turning Update billing automatically back on applies everything waiting.

Licences on the customer#

The customer's Contracts and time tab (under Commercial) has a Licences section: "Subscriptions from your distributors, and how they reach this customer's contract."

It shows:

• Billed a month (licence lines on the contract, before VAT), Cost a month, Margin a month and Unused (the monthly cost of seats not assigned in Microsoft 365);
• the Update billing automatically switch, Add by hand for a manual subscription, and All licences;
• banners for subscriptions waiting or unable to bill;
• every subscription, with Seats, Assigned, Unused, Cost, Billed, Margin, Commitment and Billing. Click one to open its panel.

Every figure is a month. An annual charge shows a twelfth, with "Billed annually" and the yearly amount beside it. Totals add up what you bill and what distributors bill, say how much of it the distributor bills, and count as "cost not billed yet" only subscriptions in force that nobody bills.

Licences by customer#

The By customer tab of Sales and billing > Licences puts every customer side by side: "£4,072.67 billed, £3,566.20 cost and £506.47 margin a month (12.4%) across 10 customers."

If Billing or Updates is not shown, add it from Columns. Filter by Billing updates to list the customers who approve changes.

A negative margin usually means a customer with no contract or no price, such as a subscription showing Cannot bill.