SSM Accounting Control
Like most other service functions, contract billing can be approached in more than one way. SSM Accounting Control (36.9.10) contains a number of settings that affect contract billing and enable you to tailor it to the needs of your own business organization.
How you bill for service depends on how you have designed your service contracts. Questions that must be considered are:
• How often do you need to bill your customers for service contracts? Do you bill quarterly? Monthly? Annually?
• Do you want to bill in advance of service or in arrears?
The trend in aftermarket sales support is to pay in advance of service. This is true because companies typically like to receive revenue before committing to service. Often the sale of the service contract coincides with the sale of a product. However, customer relationships may dictate another approach where the bill is issued at the completion of the billing cycle, rather than at the beginning.
