Understand Transaction Alerts

Certain Transaction fields lock automatically during a close period, and Maxio surfaces "expired," "overlap," and "gap" alerts to help you monitor renewals and revenue accuracy. You can also run into Invoice Item mismatches, Invoice Line Item Contract mismatches, or deferred revenue and unbilled AR figures that look confusing at the Transaction level. Alerts shown on an individual Transaction don't always add up the same way as aggregate financial reports.

Transaction in close period

Certain Transaction fields lock automatically based on two separate account settings: the Transaction Lock Date and the Closing Date.

If a Transaction's Start Date is on or before the Transaction Lock Date, most of its fields lock, including Start Date, End Date, Duration, Order Date, Item, Amount, Quantity, Recognize, MRR, ARR, and Unit List Price. Deleting the Transaction is also blocked.

If a Transaction has revenue dated before the Closing Date, only its Recognize field locks. If it has an Invoice Line Item on an Invoice dated before the Closing Date, only its Item field locks. Either condition also blocks deleting the Transaction.

Important: Changing a Closing Date or the Transaction Lock Date can change historic revenue, invoicing, and other financial records. Use caution before changing either setting.

Transaction expired

A Transaction expires when it uses a recurring Item, its end date is in the past, and it has neither been renewed nor canceled. Expiration has no direct impact on financial reports. It's primarily a function of renewal management, which helps ensure you renew or cancel every recurring Transaction.

Transaction overlap

An overlap occurs when the start date of a renewal Transaction is before the end date of the Transaction it renews. Under normal circumstances, renewals don't overlap, so an overlap can lead to incorrect revenue accounting.

An initial load of historical data through importing can create overlap conditions that aren't a problem for revenue recognition. These are simply a consequence of the import engine linking Transactions.

Transaction gap

This alert occurs when a Transaction renews another Transaction, and its start date is later than one day after the end date of the Transaction it renews.

A gap between the end date of a Transaction and the start date of the one that renews it can indicate a gap in revenue schedules. Gaps are usually caused by a data entry error or a late renewal. If the gap reflects a late renewal, make sure your revenue recognition dates are entered correctly even though your Transaction dates show a gap.

Example

A Customer's subscription ends on July 14. The sales team is still negotiating, so the subscription is neither canceled nor renewed. On August 18, the Customer agrees to renew for one year starting August 18. A one-year renewal Transaction is entered with a start date of August 18, leaving a gap of more than 30 days between the end date of the previous term and the start date of the new one.

During the gap, the Customer had access to the subscription. Check with your auditor on how your company should record the revenue. Common options include daily recognition from July 15 to August 17 (13+ months), or recording the revenue from July 15 to August 18 on August 18 and recognizing daily after that.

Consider defining sales compensation rules for scenarios like this, since the effect is that the subscription is discounted (13+ months for the price of 12), even though a typical sales booking measurement records it as a 12-month subscription.

Invoice Line Item not equal to Transaction Item

This alert appears when a Transaction's Item doesn't match the Item on one or more of its associated Invoice Line Items, which can cause issues with Finance Reports.

This alert doesn't appear if the Transaction is set to allow a different Item on its Invoice Line Items.

Invoice Line Item Contract mismatch

This alert appears when one or more Invoice Line Items associated with a Transaction belong to an Invoice with a different Contract than the Transaction's own. This condition can lead to reporting errors and out-of-balance conditions.

Deferred revenue and unbilled AR on the Transaction screen

For financial reporting, deferred revenue and unbilled AR are typically calculated by Customer Contract or by Customer, not at the Transaction level.

In most cases, the numbers on the Transaction screen are valid and useful. But they can be misleading in a few situations, most commonly:

• You have Invoice Line Items associated directly with the Contract and not with a Transaction.
• You have a Contract or Transaction that's out-of-balance.

For GAAP revenue calculations, deferred revenue and unbilled AR are calculated in aggregate across all revenue and invoices for all Transactions. Adding the deferred revenue and unbilled AR totals shown for individual Transactions may not equal the deferred revenue and unbilled AR calculated across all Transactions in a Contract.

Related information

For the steps to resolve the alerts above that have a specific fix, see Troubleshoot Transaction Alerts.