Billing rules when no blocks or purchases are available

When no block purchase is available, the overage is billed to the customer following a set of billing rules. If a block hour purchase is available but does not have sufficient hours to cover the hours billed, the labor is split between the remaining block hours and an overage charge.

When hours are posted against a block hour contract, the following billing logic is applied:

1. If there are hours remaining on the block, the contract block hour multiplier set up for the role selected on the time entry is applied, and multiplies the number of hours deducted from the block. If no contract block hour multiplier was set up for a role, but a block hour multiplier was set up in > Admin > Features & Settings > Finance, Accounting & Invoicing > Roles, that block hour multiplier is used.
2. If there is no active block available, the overage labor will be billed to the customer and the following billing rules go into effect, in this order:

• If an overage rate was set up for the contract, this rate will be used for all time entries for all roles.
• If no overage rate was set up, the contract hourly billing rate will be used, if one was set up for the role. On the contract menu, click the Rates & Multipliers link. Refer to Rates and Multipliers.
• If no contract hourly billing rate was set up (which is common for Block Hour contracts), the default role rate set up in > Admin > Features & Settings > Finance, Accounting & Invoicing > Roles is applied. Refer to Adding billing roles.

IMPORTANT  Contract rates and Block Hour overage rates may be impacted by the following system setting: Apply Contract Role Block Hour Multiplier to block hour overages, or apply Admin Role Block Hour Multiplier to block hour overages if there is no Contract Multiplier. When off, a multiplier will not be applied to overages. Make sure you take this into consideration when setting contract and overage rates.

IMPORTANT  If the labor entry uses a work type that is configured to multiply the role rate, both the block hour multiplier and the work type multiplier will be applied!

Known limitation for split transactions

If approving and posting a labor entry will result in a split transaction (part of the labor is deducted from a block and part is treated as overage), the number of hours to bill will take the block hour multiplier into account.

Consider the following scenario:

• A contract has 1 hour remaining on a block where the Hourly Rate for each block hour is $100.00
• 1 hour of labor is worked using the Senior Analyst role
• The Senior Analyst role has a Contract Block Hour Multiplier of 2 and a Contract Hourly Billing Rate of $200.00
• No general overage rate was set up

When this labor entry is approved and posted, it will count as two hours (1 hour x block hour multiplier of 2). One hour will be deducted from the block, and the second hour will be billed to the customer according to the rules above. Since there was no general overage set up for this contract, the Contract Hourly Billing Rate for a Senior Analyst ($200.00) is applied.

This means that the customer is charged $300.00 for one hour of labor ($100 for the block hour and $200.00 for the overage). The correct amount would have been $200.00.

NOTE  There is currently no way to prevent this. The only workaround is unposting the second hour and changing the rate applied to the second hour in Contracts > Approve and Post > Labor.

You can add additional retainer purchases at any time. If items are billed and for some reason sufficient retainer funds are not available, the customer is simply billed at the contract role rate or, if none was configured, the standard role rate.

NOTE  Pre-paid contract notifications and repurchase arrangements can ensure that there are always sufficient retainer purchases available. Refer to Notification Rules.

IMPORTANT  Tickets are deducted from ticket purchases based on their Create Date, not their Complete Date.

When a ticket is associated with a per ticket contract and there are no available tickets, a single ticket purchase will be created. The purchase will have the following attributes:

• One Ticket Purchase radio button: selected
• Roll-over check box: not selected
• Start Date of First Purchase: Ticket Create Date
• End Date of Last Purchase: Ticket Create Date
• Partial First Month: not selected
• Tickets (per Purchase): 1
• Per Ticket Rate: contract's Overage Per Ticket Rate
• Status: Active

A contract charge will also be created to correspond to the purchase. This contract charge will behave like a contract charge that is created when a ticket purchase is manually created. Refer to Adding block, retainer, or ticket purchases.