Reconciliation is an important accounting function because it is important to match up the products which are being billed from a provider to what is being billed to the customer.
Note: Work 365 is not an accounting tool; however, it can aid in the reconciliation process.
Work 365 automatically syncs the provider invoices from automatic providers. For example, provider invoices in Microsoft Partner Center are synced to Work 365, and pulls in all the license summary, and usage consumption data. See this article for a general overview of provider invoices.
Within the provider invoice record, the license summary will match every single line item from the provider invoice to an existing subscription in the system. Each license summary line item will show the data on quantities, currency, and pricing.
To complete the reconciliation process in Work 365, it is recommended to follow the eyeball method. This means users will compare the license quantity listed on the provider invoice with the subscription quantity. If the quantities match then by default the license summary record is confirmed.
Then users would compare the cost price on the provider invoice with the selling price on the subscription.
If the visual inspection of these two comparisons looks good, then the reconciliation for that item is completed.
Sometimes there will be differences between quantities on the provider invoice, and the quantity listed on the subscription.
For example, the quantity on the provider invoice is higher than the quantity listed on the subscription.
This can happen when Microsoft’s invoicing cycle is different from the invoicing cycle with the end customer. This visual inspection enables users to identify items that are out of the ordinary. When such occurrences happen, it is important to have an understanding of what happened in the system so this change in quantities can be validated.
In the example above, the quantity difference would need to be validated that between the Microsoft invoice cycle and the customer’s invoice cycle, the customer’s subscription quantity was changed. To validate this change, one would open this customer’s subscription and view the license change log history. Read this document for details on license change logs. The license change log history will show when changes were made, the provisioning status of license changes, and who initiated the license change. Furthermore, opening a specific license change log record will show a linked invoice record if the change log has already been invoiced. If the record is still active, and does not have a linked invoice, this means this license quantity change has not yet been invoiced by Work 365.
Following this process for license summary lines that do not automatically match up confirms these differences as being valid, and the reconciliation is completed.