Happy Business Starts Here

Highlighted
Zuora Support

Impact of changing the rev rec rule on Product Rate plan Charge

We plan to update the Rev Rec rule on our Recurring rate plan charges. 
In this regard we would like to know the impact of this change in the following scenarios -

1. Existing Subscriptions but new invoices after that change. Will the new invoices going forward show the revenue as per the new rule?

2. Existing subscriptions that have invoices already generated. For eg. if the invoice was generated in April and it is an annual service period, will the revenue distribution be impacted ?

3. New Subscriptions - I believe any new subscription that uses the updated product charge, and invoices generated in future will use the new rev rule.

Please let me know if there is any other impact that the scenarios listed above. Or other best practices that Zuora recommends us to take when we update the charges to use a different rev rec rule.

 






If you found my answer helpful, please give me a kudo ↑
Help others find answers faster by accepting my post as a solution √

1 REPLY 1
Zuora Support

Re: Impact of changing the rev rec rule on Product Rate plan Charge

The revenue recognition rule when updated at product rate plan charge level will have impact on existing and new subscriptions, the rule auto-updated at the subscription level.

 

Please find the below for the clarifications raised:
1. Existing Subscriptions but new invoices after that change. Will the new invoices going forward show the revenue as per the new rule?
Yes, the rate plan charge on the existing subscription will be updated to new rule so that new invoices being generated will have the revenue as per new rule.

2. Existing subscriptions that have invoices already generated. For eg. if the invoice was generated in April and it is an annual service period, will the revenue distribution be impacted?
No, invoice already generated through existing subscriptions won't get impacted since revenue schedule has been already done. 

3. New Subscriptions - I believe any new subscription that uses the updated product charge, and invoices generated in future will use the new rev rule.
Yes, new subscription and new invoices will use the new rule. 

Please refer the supportive knowledge center article.







If you found my answer helpful, please give me a kudo ↑
Help others find answers faster by accepting my post as a solution √