Understanding MRR anomaly

This article guides you step by step to identify the origin of an MRR that seems abnormally high or too low, understand what causes it and how to correct it directly in Fincome.

Why does my MRR seem “abnormal”?

In the vast majority of cases, an MRR that appears inconsistent is not due to a Fincome calculation error, but to:

• incorrect billing data (dates, line type, amount, discount),

• a duplicate customer or subscription,

• or a specific configuration of calculation options.

The objective is therefore to trace methodically back to the source of the figure, before any correction.

Here is a video that shows the procedure on an example of an MRR spike.

Step 1 – Identify the origin of an MRR spike or dip

The first step is always to precisely locate the origin of the observed variation observed. The method differs slightly depending on whether it is an MRR spike or a abnormal decrease.

Case #1 – An MRR spike

1. Go to Analytics > Revenue > MRR.

2. Click on the chart to display the underlying view.

3. Sort the rows by decreasing MRR.

This allows you to quickly identify the customers who contribute most to the observed spike, and to spot an MRR disproportionate relative to reality.

Case #2 – An abnormal drop in MRR

When an MRR drop seems unexplained, two complementary analyses are recommended.

Option A – Analyze MRR by customer

1. Go to Analytics > Revenue > MRR.

2. Open the underlying view.

3. Sort the rows by increasing MRR.

This view allows you to identify customers whose MRR is:

• abnormally low,

• partially missing.

We often speak here of customers “deprived” of MRR, because for example of a wrong billing period, an incorrect line type or a misinterpreted discount.

Option B – Analyze churns directly

1. Go to Analytics > Growth > MRR – ARR Movements.

2. Filter on the movement type Churn (or Attrition) and Downsell (or Contraction).

3. Display the underlying view.

4. Sort by decreasing MRR amount.

The goal is to identify the largest churns over the period, then to check whether they are:

• normal and expected (actual contract end),

• or related to a data or settings issue

Step 2 – Check the customer page and duplicates

Once a customer is identified, click on them to access their customer page.

Points to check:

• Is the customer's MRR curve consistent?

• Is there more than one customer with the same name ?

To check the second point:

1. Go to Data > Customers.

2. Search for the customer's name.

3. Check whether it appears once or multiple times.

In case of a duplicate, compare the invoices and subscriptions: it may be a customer coming from multiple sources or a subscription incorrectly attached, which can create artificial MRR. In that case, you may need to consider a customer merge, or subscription.

Step 3 – Analyze invoices and invoice lines

Returning to the customer page, open the invoices associated.

For each invoice line, always check:

• The amount : does it match the contract?

• The revenue type :

  • subscription → generates MRR,

  • one-off → excluded from MRR.

• The billing period (period_start / period_end) :

  • the period must reflect the actual duration of the contract,

  • a period that is too short or incorrect can artificially inflate or reduce MRR.

Very common case

A subscription line with a large amount spread over only a few days can create a huge MRR spike.

Correcting the period (for example to 12 months for an annual contract) is usually enough to resolve the issue.

Step 4 – Check Fincome calculation options

If:

• the line types are correct,

• the periods are consistent,

• the amounts and discounts are compliant,

then the discrepancy observed probably comes from the way Fincome interprets this data. You should then analyze the calculation options.

Go to Settings > Calculation options.

Common case #1 – MRR continues after the end of the invoiced period

Symptom: An invoice whose period ended several weeks ago continues to produce MRR.

To check:

• the option "Recognize MRR after the end of the last billed period".

Depending on the chosen rule, Fincome can:

• stop the MRR at the end of the paid period,

• or continue to recognize MRR as long as the subscription is not in canceled status.

In that case, check the actual subscription status and the possible presence of a cancellation date.

Common case No. 2 – Artificial maintenance or drop of MRR between two invoices

Symptom:

• a churn followed by a reactivation,

• or an MRR maintained despite a billing gap.

To check:

• the option to neutralize invoice disjunctions and overlaps.

This option smooths MRR in case of a slight shift between two billing periods, to avoid spurious movements.

Common case No. 3 – MRR affected by discounts or credit notes

Symptom:

• an MRR lower than the expected contractual amount.

To check:

• if discounts are all included,

• only permanent discounts,

• or totally excluded from the calculation.

A temporary discount can temporarily reduce MRR, or even create a contraction depending on the configuration.

Common case No. 4 – A churn recognized too early or too late

Symptom:

• a drop in MRR at an unexpected date.

To check:

• the churn recognition rule:

  • at the cancellation request,

  • at the effective date,

  • or at the end of the last billed period.

Summary – The checklist to follow

When your MRR seems abnormal:

1. Analyze the variation via the underlying MRR or Movements view

2. Identify the responsible customers

3. Check the customer page and absence of duplicates

4. Inspect invoices and lines (amount, type, periods)

5. Analyze calculation options and subscription statuses

In most cases, this method allows you to understand and correct a discrepancy in a few minutes, directly in Fincome.

FAQ – Frequently asked questions

→ Why does my MRR seem too high over a given period? In most cases, this comes from an invoice line with an incorrect period (too short) or a large amount spread over a short time. Another frequent cause is a duplicate customer or subscription, which generates additional MRR.

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→ Why is my MRR decreasing without obvious churn? An MRR decrease can come from:

• a churn or contraction on a high-MRR customer,

• a discount taken into account in the calculation,

• or a change related to calculation options (recognition of churn, end of billed period, neutralization of disjunctions).

The analysis of MRR Movements generally makes it possible to identify the cause.

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→ Why don't I see certain churns or reactivations depending on the selected period? Because Fincome nets MRR movements within the chosen period (monthly, quarterly, or annual). If a churn and a reactivation occur in the same period, they can offset each other. Fincome then displays only the net impact on MRR at the end of the period, for example in the form of a contraction.

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→ Why does a customer continue to generate MRR even though their invoice is finished? It depends on the rule of recognition of MRR after the end of the last billed period. If the option is configured to maintain MRR as long as the subscription is not canceled, Fincome will continue to recognize MRR. It is then necessary to check the subscription status.

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→ Does abnormal MRR necessarily mean an error in my data? No. Very often, the data is correct but interpreted differently depending on the calculation options. That is why verifying Fincome settings is a key step once the invoices have been audited.