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Can we recognize the the invoice value over an extended period of time or out of its actual term ?

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Zuora Staff

Can we recognize the the invoice value over an extended period of time or out of its actual term ?

Example :

 

A Customer signed up in January 2019 at $1200 USD per year 
The Customer decides in May 2019 to put their account on hold (suspend)
In May, $500 have been recognized already, $700 still needs to be recognized for June - December period (7 months) 


If the customer suspends the account for 2 months, the $700 needs to be recognized over 9 months (7 original months + 2 months additional). That equals to $77.77 per months for the next 9 months which is 2 months over the actual term.

1 REPLY 1
Zuora Staff

Re: Can we recognize the the invoice value over an extended period of time or out of its actual term

Yes, we can recognize the invoice value over the actual term period provided we had enabled the setting Billing - Monthly recognition over time and had set up the charge in the rate plan as recognize monthly over time.

 

We must also ensure that we edit the revenue recognition rule under finance settings and select the option "Don't define the recogniton term, Let me manually distribute the revenue" under Invoice item adjustments. By doing this you get the control of extending the invoice value over the actual term period when you recognize revenue.