Recurring Services Escrow Report


Many of our customers use various services with recurring per-month costs. These services include generally automated services such as Barracuda Email filtering, Website Hosting, Offsite Backup, and Email hosting.

(A complete list can be found here.) While the cost of these services per unit is fixed, your usage of them can be somewhat variable, but the variance generally occurs only in small quantities. These variances are usually small enough that they do not warrant a new invoice just for a few dollars of changes. So, all of these services are managed in a Recurring Services Escrow account, which works very much like your Taxes and Insurance escrow account on your home mortgage: the bank guesses at your upcoming year’s taxes and insurance costs, adds 1/12th of that cost to your mortgage note, then at the end of the year they make an adjustment based on what the actual taxes and insurance were versus the estimates. That way, you and the bank can both deal with the whole issue just once a year.




Your Recurring Services Escrow account is managed on a monthly, quarterly, semi-annual, or annual basis. The determination of which one you are on is determined mostly by the expected monthly cost of your services. For example, if all you use is Barracuda Email filtering for 6 people, you are incurring a $6 monthly charge, so you are on an annual charge basis. In this case, there is just one $72 charge that covers the whole year. That $72 charge shows up on one invoice. At the opposite extreme, if you use a large qty of Offsite Backup, fro example, you may be using several hundred dollars per month in services, in which case you are on a monthly billing plan. (If you would like to change your periodic plan, we are of course happy to discuss that.)



No matter which of the four periodic plans you are on, you will receive a Recurring Services Escrow Statement at some point during that period, which describes your anticipated monthly uses for that period, and adjustments for actual usage for past months. The resulting balance in the GREEN box at the bottom of the statement will be reflected as a single line item on the invoice that the statement is attached to. The balance may be positive (new amount owed to Goodwin PC) or it may be negative (amount over paid and credited back to customer. For example, if you are using Barracuda Email filtering with annual billing, you may have 10 users on that service at the beginning of the year, but you may add 2 users at some point in the year. By the end of the year, your usage will have gone up by $2 per month. At some point during the year, you will receive a new statement that reflects a “catch-up” amount for the months in the year in which the extra 2 units are used. That “catch-up” amount will be computed to make you current through the end of that year.



Note that there is also a list of historical list called “Previous Related Invoice Summary”, provided as a point of reference for your convenience. This list does not include the invoice number that is related to the particular statement you are reading, because that invoice number is not yet known at the time that the statement is created..



Please note that we do not try to use these services as a profit center; that is, the pricing of it is generally set to amounts that cover our cost of providing the services. As such, it is necessary and fair to bill these services partially in advance.



If you have any questions about your company’s service usage, of course let us know.


Ed Goodwin

(901) 550-2142