When to use nested commitments

Use nested commitments when you need to track related minimum-spend obligations at more than one level.

For example, a customer might commit to:

• A $100,000 minimum spend on SMS products

• A $150,000 minimum spend across all products

The SMS charges contribute to both commitments. The $100,000 product-level commitment forms part of the $150,000 account-level commitment, so the customer needs an additional $50,000 in qualifying spend to meet the account-level commitment.

Create a nested commitment

You can create a nested commitment by associating one or more child commitments with a parent commitment.

In the Child Commitments section, you can add:

• An existing commitment

• A commitment created in the same order, by reference

Add a commitment in the same order

1. In the order, configure the parent and child commitments.

2. In the parent commitment's Child Commitments section, click inside the field. The commitments being created in the same order are displayed.

3. To filter the list, enter the first few characters of the child commitment name or number, and then select the commitment from the list.

4. Review the parent-child relationship before activating the order.

Add an existing commitment

1. Open or create the order for the parent commitment.

2. In the parent commitment's Child Commitments section, click inside the field.

3. Enter the first few characters of child commitment name or number, and then select the commitment from the list.

4. Review the parent-child relationship before activating the order.

Edit a nested commitment

You can update the parent-child relationship only when the relationship is eligible for update. In particular, the child commitment must not have drawdown activity or an evaluated period that prevents the relationship from changing.

When eligible, you can:

• Add a child commitment to a parent commitment.

• Remove a child commitment from a parent commitment.

• Move a child commitment from one parent commitment to another.

You cannot remove a child commitment when unreversed child-to-parent true-up roll-up activity exists between the child and parent commitments.

View nested commitments

On the commitment detail page, view the related parent commitment or child commitments to understand how the nested hierarchy is configured. The detail page shows the parent-child relationship for commitments that participate in a nested hierarchy.

How charge contribution and true-up work

A qualifying charge that applies to both the child and parent commitments contributes to both commitments. The child commitment is evaluated first. If the child commitment has a shortfall, its true-up amount contributes to the parent commitment before the parent commitment is evaluated.

Example: order through invoicing

Suppose an order creates the following commitments with the same applicable charge, C1:

• Parent commitment CMT1: $10,000

• Child commitment CMT2: $1,000

The child commitment is evaluated first, and the child true-up rolls up to the parent commitment.

The resulting true-up amounts are generated during the applicable billing and evaluation process.

Validation rules

When you create or edit a nested commitment, Zuora validates that:

• A child commitment has no more than one parent commitment.

• A cyclic parent-child relationship is not created.

• The duration of a parent commitment period must contain the duration of the child commitment period.

• The amount of a parent commitment period must be greater than or equal to the amount of the overlapping child commitment period.

• One parent commitment period can overlap with one child commitment period. The overlap cannot span multiple periods between the parent and child commitments.

• A child commitment is not removed when unreversed child-to-parent true-up roll-up activity exists.

If a validation prevents the requested relationship change, correct the relationship or commitment state and retry the operation.