Manage calculation options

1. Recognition of churn

Objective: Determine the exact moment when Fincome removes the MRR of a subscription after a cancellation.

Options:

• At the time of cancellation request : the MRR is removed immediately after the termination request. Ideal for a forward-looking view of committed MRR.
• At the effective cancellation : the MRR is removed on the actual cut-off date (immediate or scheduled).
• At the end of the last billed period (default) : the MRR is kept until the end of the already paid period. Allows aligning churn with recognized revenue.

For more information, you can also read our article on churn recognition.

2. Application of discounts

Objective: Determine whether discounts (recurring or one-off) reduce MRR and KPIs.

Options: Calculate MRR:

• Before discount : gross contract value (no reduction).
• Permanent discounts only : only lasting concessions are deducted; one-off promotions are ignored.
• All discounts (default) : all discounts are deducted to obtain a net revenue view.

3. Consideration of credit notes (refunds)

Objective: Define if and how refunds reduce MRR.

Options:

• Include – retroactive : the period of the invoice related to the credit note is adjusted downward.
• Include – non-retroactive : the refund is recorded as an MRR decrease at the time it is issued.
• Ignore (default) : refunds do not affect MRR, past or present.

4. Time zone

Objective: Align Fincome's main clock with that of your billing tool.

5. Default display of MRR / ARR

Objective: Choose the metric displayed by default in dashboards and reports.

Options:

• MRR : monthly view of recurring revenue.
• ARR : annual projection (MRR × 12).

6. Exclusion of open invoices for canceled / unpaid subscriptions

Objective: Prevent potentially uncollectible invoices from artificially inflating metrics.

Options:

• Yes : open invoices related to canceled or unpaid subscriptions are excluded from MRR.
• No : open invoices are counted as long as they are not paid or canceled.

7. Deferred billing

Objective: Smooth MRR when the invoice is issued at or after the service period.

Options:

• Disabled : no smoothing; MRR drops at the end of the period until the next invoice is received.
• If the invoice date is closer to the end of period than to the start, Fincome keeps the last known MRR.
• If the invoice is issued ≤ 5 days before the end of period, the MRR is maintained until the next cycle.

8. Deferred billing tolerance (in days)

Objective: Set a grace period during which MRR is simulated while waiting for the next invoice.

Options: Choose the number of days to wait before considering a churn.

9. Future subscription tolerance (in days)

Objective: Set a grace period during which MRR is simulated pending an upcoming subscription whose start date is near.

Options: Choose the number of days to wait before the future subscription disappears.

10. Neutralization of period gaps and overlaps

Objective: Connect and merge lines of the same subscription if they are consecutive or complementary.

Options:

• Disabled : billing periods are taken as-is.
• Neutralize gaps : fills small voids to avoid a temporary drop in MRR.
• Neutralize overlaps : prevents double counting.
• Neutralize both.

11. Recognition of MRR after the end of the last billed period

Objective: Define how long to keep MRR if no new invoice is issued.

Options:

• Never : immediate stop after the paid period.
• Indefinitely if the subscription is not canceled : tacit renewal as long as there is no explicit cancellation.
• Indefinitely if not canceled and not unpaid : same but stops if unpaid or canceled.
• Until the cancellation date : MRR maintained until the known future date, with no retroactive effect.
• Until the end of commitment : MRR retained until the contractual term.

12. Invoice statuses taken into account in MRR / ARR

Objective: Define the invoice statuses to include in the recurring revenue calculation.

Options:

• Open + Paid (default) : commitment view: revenues are accounted for upon issuance unless canceled.
• Paid only : cash view: revenues are only counted upon receipt.
• All statuses : includes even canceled / deleted invoices.

Updated on: 01/06/2026