Use Case: Mid-Period Cancellation when the Impacted Schedule Is Not Invoiced

When you execute the API for mid-period cancellation, Billing validates the amount to be canceled due to cancellation. On successful validation, it invokes the cancellation process to execute the cancellation steps on the existing billing header. 

Prerequisites

• The cancellation date is not null and is in the range of the OLI's or ALI's start and end date.
• The setting "Superseding the Schedules during Asset Management" is set to either Minimize or Always Supersede.

Contact your admin to make this functionality available in your application so that clicking a button calls the billing services API.

At the end of the cancellation process:

• Billing schedule records before the cancellation dates remain unchanged. 

• The impacted BSR is superseded and two new BSRs are created. The first BSR is created for the partial period before the cancellation date and the second BSR is created for the partial period from the date of cancellation. BSD and adjustment BSD is also superseded.
• The first BSR and its accompanying BSD are in Pending Billing status.  Any adjustments that existed in the impacted BSR are copied with the full amount and status to the first partial period BSR.
• The second BSR and its accompanying BSD are in Canceled status.
• The fee amount of the first BSR is prorated and is calculated per the proration setting defined in the billing preference, while the fee amount of the second BSR is a difference between the fee amount of the original BSR and the first BSR created due to cancellation. The fee amount of adjustment BSD is not prorated. A new adjustment BSD with the entire amount is created under the first BSR.

• All other BSRs in the cancellation period with a Pending Billing status are canceled. Accompanying BSDs are also canceled.

• The billing header shows the OLI that initiates the cancellation of the service and its status is updated to Pending Inactivation.
• The billable amount on the billing header's Current Order Line Item field shows the amount to be canceled.
• If any adjustment BSDs are canceled, the Total Adjusted Amount field is updated accordingly. For more information about the billing header fields, see Billing Header.

Example

A new sale is initiated for a service with a TCV (Sales) of USD 1,200.00. The billing frequency is monthly. The start date is 01-July-2024 and the end date is 30-June-2025. You initiate the billing to create a billing header and twelve BSRs with a fee amount of USD 100.00 each. You created three adjustment BSDs with a fee amount of USD 100.00, USD 100.00, and USD 50.00 for the period, starting 01-July-2024, 01-March-2025, and 01-June-2025 respectively. 

Suppose you invoiced the first eight BSRs (BSR-1 to BSR-8). The billing header looks like a normal billing header (BH) showing the following data:

The data of the twelve BSRs and BSDs are shown in the table:

After Cancellation

You canceled the product or service such that the cancellation goes into effect from 16-March-2025. The Current OLI and Current Order Number fields on the BH are updated to the newly activated OLI used to initiate the cancellation process. The End Date field on the BH is updated to the product or service cancellation date. The TCV (Sales) field is updated to show the sum of Invoiced and Pending Billing BSRs. The Billable Amount for Current OLI field shows the amount to be canceled. The Total Invoiced Amount field shows the roll-up of the BSRs in the Invoiced status. The Status field on the BH is updated to Pending Inactivation.

Scenario 1: Setting "Superseding the Schedules during Asset Management" is set to Minimize.

You have canceled the order such that the cancellation goes into effect from 16-March-2025. After cancellation, various fields on the BH are updated as follows:

At the end of the cancellation process, the BSRs before the cancellation date remain unchanged. The impacted BSR (here BSR-9 and its BSD) is superseded and two new BSRs are created (BSR-13 and BSR-14). The first BSR is created for the partial period before the cancellation date and the second BSR is created for the partial period from the date of cancellation. The fee amount of BSR-13 is prorated and is calculated per the proration setting defined in the billing preference. The fee amount of BSR-14 is USD 0.00 due to the roll-up amount of the actual BSD-14 and the counter BSD-14.a.

The BSRs are as follows:

The BSRs and adjustment BSDs in the Pending Billing status after the cancellation date are marked as canceled. Counter BSDs are created for records that are canceled in pending billing status. These BSDs can be used to offset the revenue forecast from the previous BSDs of the same period.

Scenario 2: Setting "Superseding the Schedules during Asset Management" is set to Always Supersede.

You have canceled the order such that the cancellation goes into effect from 16-March-2025. After cancellation, various fields on the BH are updated as follows:

At the end of the cancellation process, the BSRs before the cancellation date remain unchanged. The impacted BSR (here BSR-9 and its BSD) is superseded and two new BSRs are created (BSR-13 and BSR-14). The first BSR is created for the partial period before the cancellation date and the second BSR is created for the partial period from the date of cancellation. The fee amount of BSR-13 is prorated and is calculated per the proration setting defined in the billing preference. The fee amount of BSR-14 is a difference between the fee amounts of BSR-9 and BSR-13. The BSRs and BSDs in the Pending Billing status after the cancellation date are marked as canceled.