Billing Reconciliation
Billing reconciliation is the process of comparing and verifying that the amounts billed to customers match the contracted terms, the services delivered, and the payments actually collected.
In subscription businesses, billing reconciliation verifies that each customer is charged the correct amount based on their plan, usage, discounts, and contract terms. Discrepancies indicate revenue leakage — either overbilling (compliance risk) or underbilling (revenue loss).
A thorough reconciliation process compares: contracted price vs. invoiced price, invoiced amount vs. collected amount, usage vs. billed usage, and discount terms vs. applied discounts. Most companies perform this monthly or quarterly; AI-powered tools enable continuous reconciliation.
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