Cancellation Order Management

Understand Cancellation Orders

Let’s have a quick review on how subscription cancellation works in Salesforce CPQ. To terminate a subscription, make an amendment quote and then reduce the quantity of the related quote line to zero. When you order that amendment quote or opportunity and then contract the order, the corresponding subscription order product has a terminated date that’s one day before the amendment quote’s start date. We call this type of order product a Cancel Order Product. All Cancel Order Products have these values.

• Date selected in the Terminated Date field, which is filled after product contracting is complete.
• Contract Action field equals Cancel, which is set when the amendment quote is created.
• Revised Order Product field is complete, which occurs when the order product is created.
• Cancel Order Product contains a positive or negative Total Price field.

Note Orders can be created with or without quotes, so contracting isn’t always supported or required.

A Cancellation Order refers to any order that contains at least one Cancellation Order Product.

Canceling recurring products impacts your billings as well. For example, let’s say you cancel a 12-month subscription halfway through its billing cycle. You must track how much you’ve billed from the first six months and the number of billings that you’re no longer receiving. All order products have a collection of fields that show the number of billings at various stages in the billing process.

Pending Billing Amount (without tax)

Amount remaining to be billed, not including tax. Invoice plan order products don't populate this field.

Canceled Billing Amount (without tax)

Total that isn’t billed due to subscription cancellation or swapping, not including tax.

All order products begin with a canceled balance of zero. When you activate a related Cancel Order Product, Salesforce Billing moves an order product’s pending billings to its canceled billings based on the Cancel Order Product’s total balance. We review the logic behind this movement later in the article.

Terminated Billing Amount (without tax)

The amount that Salesforce Billing could cancel from an order product. Terminated billings equal the larger of two possible values.

• The amount billed from the termination date to the order product end date
• The amount billed from the next charge date to the order product end date

Terminated billings can be less than or equal to the order product’s pending billings, but never greater.

Terminated billings on a cancel order product are always zero.

Note To review the billing types used in the billing process, check out Billing Frequency.

Often, canceling a subscription leaves you with several order products with pending balances from earlier orders. You must make sure that an invoice run doesn’t include these pending balances on a future invoice. Salesforce Billing uses a Cancel Order Product to reduce the pending balances of your original and amendment order products by an amount equal to the Cancel Order Product’s total. This process ensures that you don’t invoice for canceled billings.

Cancel Order Scenarios

A quote can generate any number of amendments, and thus any number of orders. Order products can also be positive or negative—for example, a discount appears as a negative order product. Businesses encounter scenarios based on the number of previous orders, the positive or negative status of both original order products, and the Cancel Order Product. Let’s consider a few.

• Positive order product and negative Cancel Order Product
• Negative order product and positive Cancel Order Product
• Several positive order products and one negative Cancel Order Product
• Several negative order products and one positive Cancel Order Product
• Positive and negative order products with a negative Cancel Order Product

Regardless of the scenario, Salesforce Billing aims to reduce the pending balance to zero on all the original order products. When you activate the Cancel Order Product, Salesforce Billing checks whether it has enough pending billings to reduce the value of all prior pending billings to zero. For example, let’s say your original order product has a pending balance of $150. The amending order product has a pending balance of $75, and your Cancel Order Product has a pending balance of -$300. Salesforce Billing zeroes out the prior pending billings and reduces your Cancel Order Product by $225. It invoices the remaining -$75 the next time you run an invoice or Bill Now activation picks up your Cancel Order Product for invoicing. Each order product’s Canceled Billing Amount field lists the amount moved out of pending billings.

You find cases where both the prior order products and the Cancel Order Product end up with pending balances of zero. In this case, there’s nothing left for Salesforce Billing to invoice. If your prior order products don’t have any pending billings, Salesforce Billing doesn’t allocate anything from your Cancel Order Product. And invoices it for its full pending amount on the next invoice run or Bill Now application.

Cancellation Rule

Salesforce CPQ allows users to create multiple amendments off an order. Amending orders often creates scenarios where one order product is related to several order products through several different amendments. In this case, if you have more than one prior order product, Salesforce Billing must determine which of your prior order products have pending balances of zero and which have a pending balance remaining.

Sometimes, your Cancel Order product isn’t enough to reduce the pending balance on all prior order products to zero.

When you activate a Cancel Order Product in this scenario, Salesforce Billing checks the value of the Cancellation Rule field on the Cancel Order Product’s billing treatment.

Legacy

Salesforce Billing performs legacy cancellation allocation. You can review legacy cancellation allocation in Legacy Billing for Canceled Products.

LIFO

LIFO stands for “Last in, first out.” In this case, it means that Salesforce Billing aims to cancel pending billings on the newest order product first. The Cancellation Rule contains several LIFO options, each with a different order product date field used to prioritize cancellation, such as termination date or order product activation date.

Salesforce Billing uses this logic only when your amending order products can’t fully cancel the pending balances of the original order products. Otherwise, Salesforce Billing cancels the original order products and subtracts the sum of their pending balances from the Cancel Order Product’s pending balance.