Invoicing of new licenses between two quarterly bills.
Have you added new licenses during an ongoing quarterly subscription period and noticed that the number of licenses or the invoice amount does not match the number of licenses ordered? This is usually because the licenses are billed proportionally based on the time remaining in the current subscription period. In these situations, Expense uses Pro Rata invoicing, meaning you only pay for the portion of the subscription period during which the licenses are actually active.
What Is Pro Rata Invoicing?
Pro Rata means that the cost is adjusted according to the remaining time in the current billing period.
If new licenses are added halfway through a quarter:
- ✅ You only pay for the remaining portion of the subscription period
- ✅ Billing is fair and time-based
- ✅ You are not charged for time when the licenses were not active
On the invoice, this is typically displayed as:
Adjusted Pro Rata to the Subscription Period
Why Does the Number of Licenses Differ on the Invoice?
When licenses are added during an active billing period, they are converted into a proportional value based on the remaining time in the subscription period.
As a result, the invoice may show a different quantity than the actual number of licenses added.
👉 This is completely normal and is only used to calculate the correct cost.
Example
Assume the following:
- 📅 Billing Period: January to March
- 👥 New Licenses Added: 5
- 📅 Licenses Added In: February
Since the licenses are not active for the entire quarter, the cost is prorated.
The invoice may therefore show:
- Licenses: 3.30
- Description: Adjusted Pro Rata to the Subscription Period
✅ In this example, the customer only pays for the portion of the quarter during which the licenses were available.
How Does This Affect the Next Invoice?
During the next regular billing period:
- 👥 All active licenses will be invoiced at their full value
- 📅 The entire subscription period will be charged
- ✅ No prorating will be applied
Pro Rata invoicing is only used when licenses are activated during an ongoing subscription period.
Benefits of Pro Rata Invoicing
✅ Fair Billing
You only pay for the period during which the licenses are actually available and in use.
📊 Transparent Cost Allocation
License increases can take effect immediately without waiting for the next billing period.
⚙️ Automatic Calculation
Expense automatically calculates the correct cost based on the remaining subscription period.
Frequently Asked Questions (FAQ)
Why doesn't the invoice show the exact number of licenses we ordered?
Licenses added during an active billing period are converted into a proportional value to calculate the correct cost for the remaining period.
What does "Adjusted Pro Rata to the Subscription Period" mean?
It means the subscription cost has been adjusted according to the remaining time in the current billing period.
Have we received fewer licenses than we ordered?
No. You have access to all licenses that were purchased. The proportional value only affects how the invoice is calculated.
Will the next invoice show the full number of licenses?
Yes. The next regular invoice will be based on the actual number of active licenses and will cover the entire billing period.
Summary
- 👥 New licenses added during a billing period are invoiced proportionally
- 📅 You only pay for the remaining part of the subscription period
- 💰 Costs are adjusted using the Pro Rata billing model
- 📄 The invoice displays this as "Adjusted Pro Rata to the Subscription Period"
- ✅ The next regular invoice will show the full number of active licenses and full-period billing