How to control credits and reservations with the new invoice configuration

3 minute read
Content level: Intermediate
1

With the new Invoice Configuration feature, organizations with consolidated billing are now able to invoice subgroups of accounts independently, facilitating charging independently different customer entities. This mechanism, however, can cause conflicts to how credits and reservation discounts should apply to these groups of accounts (invoice units). This article provides more insight into this issue, and how you can prepare to avoid such impact to your invoices.

1. Scenario

Customers who use AWS Organizations to maintain their accounts under the same structure may receive credits or have reservations (Savings Plans/Reserved Instances) at the payer level, meaning that these benefits can be shared with all the linked accounts, if org-wide sharing is enabled (it is by default).

With the new Invoice Configuration feature, customers are now able to group some of the member accounts as "invoice units", so they are invoiced separately, using different payment configurations and legal entities. As a result of that, any savings from reservations or credits applied to the organization may be shared with these invoice units unintentionally.

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2. Solution

If an invoice unit should not benefit from credits or reservation savings originated from other accounts in the same organization, it's possible to avoid this scenario by disabling sharing for each of the accounts that are part of invoice units.

As a result, other accounts in your organization, which are not part of invoice units, will continue to consume the benefits, effectively separating how credits/savings are applied.

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The sharing settings for accounts can be updated on the Billing Preferences console, using your organization's payer account.

To disable credit sharing for an invoice unit:

  1. Access your Billing Preferences page
  2. Scroll down to Credit sharing preferences
  3. Select the accounts that are part of the invoice units which you want to disable credit sharing
  4. Click on the Actions drop-down and select Deactivate All
  5. In the dialog box, confirm by clicking on the Deactivate button
  6. The selected accounts should now show their sharing preference as Deactivated

To disable discount sharing from reservations, scroll down to Reserved Instances and Savings Plans discount sharing preference and perform the same steps described above.

For guidance about how to update your accounts, you can refer to this document for both the credit sharing and reservation discount sharing options.

Some important considerations:

  • This change should be made before the last day of the month, when bills are processed and invoices generated.
  • Remember to add/remove accounts as they join or leave an invoice unit.
  • In some cases, accounts with sharing options disabled may have underutilized reservations or large credits expiring without being fully consumed, if either of those are applied directly to the account rather than the organization.**

3. Conclusion

Planning and preparing before performing invoice changes to your organization is important. The new Invoice Configuration feature makes the management of invoices within an organization much more flexible, matching your business structure with more control and facilitating chargeback.

These suggestions should help you to align your credit or reservation sharing strategy with new invoice units.

If you need support for account and billing management, please contact our support teams by creating a case.

1 Comment

Wouldnt it be great if instead of this patchwork , and trying to keep everything in sync - all Billing and Cost Management services leverage the account groupings available in AWS Organizations? See https://medium.com/@s098_47930/tags-in-aws-what-are-they-why-do-you-need-them-d1da231d59c1

replied 2 months ago