Addition Prorate Price Formula
ConnectWise calculates the prorate price for agreement additions automatically once you enable the Prorate Agreement option. This page explains the formula it uses so you can verify results or troubleshoot unexpected amounts.
Note: This page covers the math behind prorate pricing. For the steps to enable proration on an agreement, see Prorate New Agreements Using Additions.
How proration is triggered
ConnectWise only calculates a prorate price when the Prorate Agreement checkbox is selected in the agreement’s Recurring Invoicing Parameters pod.
When that checkbox is selected, ConnectWise uses three values to compute the prorate:
- Billing Cycle and Billing Start Date from the Recurring Invoicing Parameters pod
- Effective Date from the addition
The formula
Addition Prorate Price
(Addition Unit Price × Addition Effective Days) / (Period End Date − Period Start Date)Addition Effective Days
(Period End Date − Period Start Date) − (Addition Effective Date − Period Start Date)Formula variables
| Variable | What it is | Where to find it |
|---|---|---|
| Unit Price | The per-unit price of the addition | Finance > Agreements > agreement > Additions tab > select the product > Unit Price |
| Addition Effective Date | The date the addition became active | Finance > Agreements > agreement > Additions tab > select the product > Effective Date |
| Period Start Date | First day of the current billing cycle | Finance > Invoicing > Agreement Invoicing tab > Period Start Date column |
| Period End Date | Last day of the current billing cycle — derived from Billing Cycle | See billing cycle offsets below |
Period End Date by Billing Cycle
The Period End Date is not stored directly — ConnectWise calculates it from the Period Start Date based on the Billing Cycle setting:
| Billing Cycle | Add to Period Start Date |
|---|---|
| Weekly | 1 week |
| Bi-Weekly | 2 weeks |
| Monthly | 1 month |
| Bi-Monthly | 2 months |
| Quarterly | 3 months |
| Semi-Annual | 6 months |
| Annual | 1 year |
Period Start Date and Cycle Based On
By default, the Period Start Date is the first day of the month of the Billing Start Date — not the exact billing start date itself.
To make the Period Start Date match the exact billing start date, go to Manage Labs and activate Agreement Invoice Billing Start Date.
The Cycle Based On field also affects when periods begin:
- Calendar Year — the year starts January 1st.
- Contract Year — the year starts on the contract start date.
Worked example
A managed service agreement has a monthly billing cycle. A new backup service addition with a unit price of $45 is added on August 13th. The billing period runs August 1st through August 31st.
Addition Effective Days:
(8/31/2017 − 8/01/2017) − (8/13/2017 − 8/01/2017)
= 30 − 12
= 18 daysProrate Price:
(18 × $45) / 30
= $810 / 30
= $27.00ConnectWise bills $27.00 for August, then the full $45.00 for September onward.
Invoice display
To show the proration notice on the invoice, the agreement’s invoice template must be configured correctly.
In the invoice template’s Body tab, go to the Other Charges (Includes Products) pod:
- Select Display Description to show the text: “This item has been prorated with a start date of: MM/DD/YYYY.”
- Select Display Prices to show the calculated prorate price on the invoice line.