When to use this
Use usage-based revenue when revenue depends on milestones, units consumed, or percentage completion rather than calendar time. Set up a usage-based account once, then each month enter the usage manually or connect a spreadsheet that syncs automatically. ScaleXP recognizes each invoice in that account from the usage you supply, rather than from its line item dates.
For a simpler "spread everything in this account the same way" pattern, use How to set rule based revenue allocations. For a line that mixes a fixed and a time-based element, see How to set up a complex, multi-tiered revenue allocation rule.
Step 1: Open the usage-based recognition rules
- On the Journals tab, open Month-End Close and click Open on Usage revenue under Revenue.
- Click the cog at the top right of the Usage Revenue page. You can also open it from the cog on the Customers tab, then Usage Based Recognition.
The Configure Usage Based Recognition Rules window opens.
Step 2: Choose your usage data source
Under I will input my data from, choose how you will enter usage each month:
- Manual entry: enter amounts or percentages on the Usage Revenue page. See Usage-based revenue: Update.
- Google Sheet: connect a template sheet that syncs daily. See Usage-based revenue: Connect Google Sheets.
- Microsoft Excel: connect an Excel Online template through Microsoft 365. See Usage-based revenue: Connect Microsoft Excel.
All usage-based accounts use the same source. You can't mix manual entry with a spreadsheet across accounts.
Changing the source later deletes any usage entries made to date, and every invoice in the account goes back to unallocated. ScaleXP asks you to confirm first.
Step 3: Choose the currency
Under Show amounts in, choose the currency you enter and view usage in:
- Home currency (for example USD): matches the rest of ScaleXP. Amounts are converted at the exchange rate recorded on each invoice in your accounting system, not today's rate.
- Invoice currency: each invoice's own currency.
If a spreadsheet is connected, changing this also converts the amounts on the sheet, using the same rate for each invoice.
Step 4: Select the GL account
Select the revenue account you want to flag as usage-based. Every invoice posted to that account is recognized from the usage you supply, rather than ScaleXP's text recognition.
Step 5: Add or remove usage-based accounts
- Add: click Add Usage Based Account and select the next account.
- Remove: click the bin icon next to the account. ScaleXP returns that account to standard recognition from that month forward; earlier postings stay as they were.
Step 6: Enter your usage
If you chose a spreadsheet, follow Connect Google Sheets or Connect Microsoft Excel to create and connect your template. For manual entry and the monthly flow, see Usage-based revenue: Update.
Example: fixed-fee project with milestone billing
A $40,000 fixed-fee project is invoiced upfront to a Project Revenue account flagged as usage-based. Revenue should be recognized as milestones close: 30% at design sign-off, 40% at build completion, and 30% at go-live.
- Month 1: enter 30% (design sign-off). ScaleXP recognizes $12,000.
- Month 3: enter 70% cumulative (build complete). ScaleXP recognizes another $16,000.
- Month 5: enter 100% cumulative (go-live). ScaleXP recognizes the remaining $12,000.
The full $40,000 is recognized in the months the work is delivered, whenever the invoice was raised.