Reservations Bill Breakdown for Linked Account

Hi there,

Thank you for reaching out to us. Let me address each of your questions separately :

1. Will reserved instance costs appear in Cost Explorer in the account they were purchased or in the account where they were applied.?

• The Reserved Instance costs comprises of different charge types. If your reserved instance purchase is a 'Partial Upfront' (or) a 'No Upfront' purchase - there will be a monthly recurring charge. This will get reflected in the linked account. You can see this --> If you use Group by option as 'Charge type` in your Cost Explorer service.

• With respect to the Billing benefit application of the reserved instance --> If there are one - to- one attribute matches with an instance ; it will get applied to the same account. Now, if your organization has RI and SP discount sharing enabled at the payer account level and your account doesn't have the same set of Instances/attributes you purchased for --> it will get applied to the same attribute usage in Linked accounts.

• In short - You can see the Billing benefit of the reserved instance usage by using Filter : 'Reservation applies usage' and Recurring fee using Monthly Recurring fee under section Charge type . Please ensure to use the Group by option Linked account in cost explorer.

• See (i). How Reserved Instances are applied (ii). https://aws.amazon.com/premiumsupport/knowledge-center/reserved-instance-applying-why/

2. 'I have an Management Account and two sub accounts B and C. If the reservations I bought in the Management Account are applied to EC2 instances in account B are they billed to the Management Account or B when I break out costs by linked accounts?'

• Yes, you're right. The Billing benefit of RI's purchased in management account are being utilized by the linked accounts; if the RI and SP discount sharing in enabled on the Payer account's Billing preferences section in their billing console.
• The recurring charges are rolled back to payer account ; as they all are part of an organization.
• The Owner of the RI - any account ; shows the recurring charge.

3. 'When I look at my cost explorer by linked account do I see all the costs generated in that account including the reserved instances that were consumed by the account or are reserved instances billed in the account they were purchased in?`

• You see both. You just have to group it by Charge type in the cost explorer feature to understand which is the monthly recurring charge and which is the Reservation applied usage.
• See Filtering the data that you want to view - Filter and group options

Please let us know if you face any issues, We'd be glad to be of help!

Check out the links to documentation that @Nithin Chandran R provided, as there's some useful info in regards to how RIs apply to accounts in Organization. But in short, here are quick responses to your questions specifically:

I'm having a hard time figuring out if reserved instance costs appear in Cost Explorer in the account they were purchased or in the account where they were applied.

The fee for the RI itself (either an upfront fee, or the recurring monthly fee, depending on the purchase option you chose) will always go to the account that purchased the RI. So, if you buy your RI on the Management Payer account - that account will receive the charges for the RI itself. If it was purchased on the linked account, that linked account will be charges for the RI (EVEN if that account is not using the discount from the RI it purchased).

For example I have an Management Account and two sub accounts B and C. If the reservations I bought in the Management Account are applied to EC2 instances in account B are they billed to the Management Account or B when I break out costs by linked accounts?

In Cost Explorer you have an option to view charges either as "unblended" or "amortized" (see advanced options in the bottom right corner of Cost Explorer console). In case of unblended, any fees you pay for the RIs are allocated to the accounts that actually purchased the RIs. "Unblended cost" is what appears on your monthly AWS invoice. When you look at "amortized cost" - this is where you can see the RI discount is actually applying (to which linked accounts). Essentially, on your monthly AWS invoice, you would normally see RI fees on the account that purchased the RI, and you would see $0 charges for usage on linked accounts that benefited from the RIs. But if you want to see which accounts benefited from the RIs, you can group your Cost Explorer graph by linked account, and use amortized view for checking this.

Put another way. Do reserved instances get applied to the Management Account as a lump sum at the beginning of the month or are they reflected as EC2 costs (billed at a lower rate) accrued inside of the linked account? When I look at my cost explorer by linked account do I see all the costs generated in that account including the reserved instances that were consumed by the account or are reserved instances billed in the account they were purchased in?

It's both :) depending on whether you look at the unblended of amortized cost. And depending which one you need. From AWS monthly invoice perspective, the RI fees are charged to the account that purchased the RI. When you look at Cost Explorer grouped by linked account, and if you use amortized cost, you will see the EFFECTIVE cost of your RI applied to the account that benefited from the discount (because on the invoice, the on-demand cost will be $0 for resources that benefited from the RI discount).