Recurring Arrears Services
Overview
Recurring Arrears services allow billing customers for recurring services used during the prior billing period. This method of billing after consumption of service is called billing in arrears, and is also how Aria bills for Usage services. Recurring Arrears services differ from Usage services in that Recurring Arrears pricing is based on a subscription billed on a recurring interval and not on the amount of consumption of that service.
Recurring Arrears Services vs. Recurring Services
While Recurring Arrears services are closely related to Recurring services, there are some noteworthy differences in billing behavior aside from being billed at the end, rather than at the beginning, of the billing period. These differences are related to price changes, plan changes, proration, and invoice line item data.
| Scenario | Recurring Billing | Recurring Arrears Billing |
|---|---|---|
NormalCustomer subscribes to monthly Recurring or Recurring Arrears service on May 1 for $100/month. |
A $100 charge is calculated on May 1 for the billing period of May 1 through May 31. Customer is billed $100 on May 1 Billing Anniversary. | A $100 charge is calculated on May 31 for the billing period of May 1 through May 31. Customer is billed $100 on June 1 Billing Anniversary. |
Price ChangeCustomer subscribes to monthly Recurring or Recurring Arrears service on May 1 for $100/month. On May 15, you change the price of that service to $110/month. |
A $100 charge is calculated on May 1 for the billing period of May 1 through May 31. Customer is billed $100 on May 1 Billing Anniversary. | A $110 charge is calculated on May 31 for the billing period of May 1 through May 31. Customer is billed $110 on June 1 Billing Anniversary. |
Plan Change/CancellationCustomer subscribes to monthly Recurring or Recurring Arrears service on May 1 for $100/month. Customer cancels Recurring or Recurring Arrears service on May 15. |
A $100 charge is calculated on May 1 for the billing period of May 1 through May 31. Customer is billed $100 on May 1 Billing Anniversary. A $50 credit is calculated on May 15 and consumed either on the June 1 Billing Anniversary invoice OR in case of a plan change, the credit is consumed on the immediate or Billing Anniversary invoice that includes the charge for the new plan. |
A prorated charge of $50 is calculated on May 15 for the billing period of May 1 through May 15. Customer is billed $50 either on May 15 (immediately), or on June 1 Billing Anniversary. In case of a plan change, the new plan will be billed along with the old Recurring Arrears plan. |
Purchase Order UpdateCustomer has Recurring or Recurring Arrears service and is in the middle of the May 1 through May 31 billing period. The customer updates the purchase order number of that service from 123 to 456 on May 15. |
The customer's May 1 invoice for May 1 through May 31 reflects a PO number of 123. | The customer's June 1 invoice for May 1 through May 31 reflects a PO number of 456. |