Mar 07, 2019 - 11:19 AM
The issue is that vendors are universally rubbish at maintaining entitlement records. There are always mistakes or grey areas, particularly when entitlements have evolved or are dependent on other contract terms like Software Assurance. Don't get me started on entitlement transfers between entities, or metric conversions.
If we're going to use invoices as proof-of-entitlement then certainly we need a standard for what is recorded on them - SKUs, Product Descriptions, Quantities, Terms. These are often reseller-dependent. In my experience buying Microsoft licenses, for example, Comparex always listed the MS SKU and official product description but Insight didn't.
I hate to use the buzzword but Blockchain would be a fantastic solution to this issue. Secure, irrefutable ledger, extensible in terms of the data you can store, and crucially allows for transfers of assets.
Having said all this I have used invoices to track down potential entitlement holes. I spent literally days tracking back every PO for our historical Microsoft agreements (there were dozens of agreements, hundreds of POs with many resellers) when an MLS highlighted a potential 7-figure shortfall. That was all clawed back by cross-referencing invoices, POs, receipts, and payments. It wasn't irrefutable proof but was enough to give everyone confidence we'd be fine if we were audited.
Mar 12, 2019 - 07:47 AM
In terms of retention, I think any policy should keep Proof of Entitlement for as long as you need to show that you still own it! That is likely to outstrip any financial retention policies.
Useful answers on the original linkedin thread here:
Mar 12, 2019 - 09:50 AM
An invoice is a legal document and the law and accounting practices meant that if an invoice has been issued it has almost certainly been paid for. AJ is correct that a credit note may have been issued, but this is rare, and to be honest, in a dispute in an audit, the onus would always be on the publisher to prove the credit note existed, not you to prove it doesn't - it's impossible to prove a negative.
Far more common are issues where either the reseller or the publisher has failed to follow the correct process and so the publisher doesn't recognise the entitlement or has booked the information incorrectly. Where this has happened to me, a report showing the date of purchase, invoice number, what was purchased etc was sufficient evidence to prove that we had bought the license with the accompanying support & maintenance, and the publisher corrected the record. I suspect in that case that the publisher had made the error, which may have meant the issue was easier to resolve.
The biggest problem with invoices is that ERP systems change and it can be effectively impossible to access the data, let alone obtain a copy of the invoice, so there is a strong argument for keeping reseller consumption reports as a supplement to the data in your internal finance system.
Accounting retention periods can be an issue with publishers who regularly sell upgrades. When this was an issue in an audit, we were given the choice to either provide all the invoice details so we could build up a picture of the upgrades, or to only use base licenses that had been purchased in the past 7 years - we chose the latter option as that was the most practical for us (although in the event it turned out we mostly owned loads of FPP product so the point ended up being moot).
Regarding retention periods for invoices, the best answer is 'it depends' - on the publisher and on the licence model! Personally I wouldn't be too worried about keeping copies beyond finance's retention period if you have accurate consumption reports, whether from the vendor, reseller or from finance themselves.