The Total Value field may be used instead of the Rate field when setting up a Subscription Item. When employed, the amounts of all Fixed Charges on the Subscription Item will be calculated. The sum of all Fixed Charges will equal the Total Value.

Before you begin

• Total Value is used when you have the full value of an Item sold, and a Rate is not available.
• Review this example for considerations when deciding a Rate Type and whether to use Rate or Total Value.
• Total Value is compatible with the following Rate Types:
  • One Time Charges
  • Fixed (Recurring)
  • Fixed (Recurring) & Usage (Variable) - only applies to fixed Charges
  • Prepaid Amount - only applies to fixed Charges
  • Prepaid Item Quantity - only applies to fixed Charges

Key Characteristics

• You must choose either Rate and Total Value for a Subscription Item - you cannot use both.
• Total Value handles scenarios in which the amount should be equally distributed amongst all Charges for the Subscription Item to back into a per-Charge Rate.
• It is recommended to populate the Per Term field. If a Term value is not set on the Subscription Item, all Charges will receive an equal Amount value (whether a full or partial period).
• Quantity represents the number of Items sold for the listed Total Value amount, and is used in calculating the Charge Rate. The Total Value will always be the sum of all Charges, regardless of the Quantity entered.
  • Quantity does not impact the final Charge Amount, but can change the Term Rate for each Charge. The Term Rate adjusts according to the Quantity, decreasing its value to ensure fixed Charge Amounts continue to sum to the Total Value.
• If the Start or End Dates of a Subscription Item are updated, it is expected that Total Value will also be updated at this time in most scenarios. Otherwise the Amount per Charge will change.

Total Value Charge Calculations

Charge amounts are determined by means of the Term Multiplier, if a Per Term value (e.g months, quarters, years) is set on the Subscription Item (recommended).

The calculated Term Multiplier value across all Fixed Charges will be summed; then, the Total Value will be divided by the Term Multiplier sum in order to arrive at a Per Term value.

• Individual Charge Amounts will be weighted based on their Term Multiplier values (effectively prorating the Amount by Term Multiplier).
• If a Per Term value is not set on the Subscription Item, all Charges will receive an equal Amount value, regardless of the time period covered by each Charge.

Total Value and Discounts

The Total Value is representative of the net value of Charges after discounting. If a Discount Percentage or Discount Amount is entered on the Subscription Item, the pre-discounted Total Value is calculated, so that the Charge is inclusive of the Discount, but the sum of all Charges still equals the Total Value.

Example

Fixed Recurring Subscription Item with a Total Value of $13,000, 'Monthly' Term and Monthly (Non-calendar based) Charge Schedule. An additional discount of 50% is entered on the Subscription Item.

Outcome:

Total Value and Amendments

If the Total Value is changed and no Charges have been billed for the Subscription Item, the new Total Value is calculated across all Charges.

If some Charges (but not all) have been billed and the Total Value is changed, the system evaluates the new Total Value against the original Total Value, less what has already been billed, and the remaining amount is distributed across all open Charges.

If the Subscription Item Total Value is amended after Charges have been billed and the Amount Billed exceeds the new Total Value, the negative offset will be distributed across the remaining Charge Periods.

Example

A Fixed (Recurring) Subscription Item is set up for a one year license with a monthly Charge Schedule and a Term of ‘Months.’ The Total Value is set to $12,000. Initially, all Charges are $1000/each. The first three Charge periods are Billed.

Mid Contract, the Total Value is changed to $24,000. The unbilled remainder of $21,000 will be distributed across the remaining 9 (open) Charges, resulting in 8 Charges of $2,333.33 each and a final Charge of $2,333.36.

 

 

Alternatively, the Total Value is changed to $2,100. The gap to Total Value, -$900, will be distributed across the remaining 9 Charges, which will be -$100/each.

 

 

Note: The Override Bill Date feature may be used to bill these 9 Charges on a single Transaction.