Accruals Overview, FAQ &

Examples
The terminology ‘Accruals’ in Envizi refers to system-generated estimates
for missing consumption and/or cost data in Accounts. The missing gaps
generally represent holes in a historical data set due to reasons such as
missing invoices, or because the latest invoice is not yet available.

Envizi has the capability to accrue consumption data (derived using average
historical consumption or linked interval meter data), and / or cost data
(derived using historical cost data or latest received invoice). Accruals
generated are stored in the platform alongside monthly actual data, and can
be used for consumption, emission, energy and cost reporting just per
actual data.

Accrual Calculation Methodology - Organization

wide
Envizi provides several out-of-box accrual calculation methodologies for
consumption and cost accruals. The principle is to generate the accruals
based off data from a chosen historical period. Accruals are generated
based on the daily average value of a pre-defined historical period,
multiplies by the number of missing days in a month.

Accrual = Historical Daily Average * Number of Missing Days

Methodologies for calculating consumption accruals based on a predefined

window of historical period:

• Last 12 months*
• Last 18 months*
• Last 24 months*
• Entire data set
• Last Available Month
• Same Month Last Year
• Weighted Average
• Using linked interval meter data

Methodologies for calculating cost accruals:

• Same as consumption's methodology above

• Not Required
 • Last Invoice

* Months are counted from current month (inclusive), regardless of the last actual data point loaded in the Account, period is not
relative to any missing data gaps

Accrual Methodology by Account Style

Generally, a chosen Accrual Methodology will be applied to all data set
within the organization. However, in some cases you may want to have
different data type to use different accrual methodologies. For example,
Natural Gas consumption for heating could be quite seasonal and normally
peaks in winter, so method such as 'Same Month Last Year' would make
sense. While Electricity consumption for lighting may exhibit a similar
pattern throughout the year, so the 'Last 12 months' method would be more
suitable in such situation.

To achieve this, you can set up different Accrual Methodology per Account
Style as one of the following:

Tag Type or Tag Details

• Inherit Associate Settings (default)
• Last 12 months
• Last 18 months
• Last 24 months
• Entire data set
• Last Available Month
• Same Month Last Year
• Weighted Average

Cost Accruals by Account Style

• Inherit Associate Settings (default)
• Not Required
• Same as consumption's methodology
• Last Invoice

Account using linked Meter for Accruals

If the organization has been set up to use interval meter data to
generate Account accruals, then the interval meter data prevails of
the Account is linked to a physical Meter – regardless of the
methodology set up on its Account Style.

Additional notes
• Once actual data is entered into a period containing accrued data,
the accrued data will be cleared and the actual data will be reported
instead
 • Accruals are generated on Account data only. Accruals are not
generated for filling missing gaps in interval metering data in Meters
• Envizi has the option to 'lock down' data before a predefined date. If
this option is enabled, calculated accrued data will also be stored
and locked in the platform.

Accruals FAQ
When and How Accurals are calculated?
• Accruals are calculated in monthly block only (for any missing days
in the month)
• Accruals are calculated and refreshed instantly after any data file
loading, new data capture, or manual update of any exsiting record
in the account
• Accruals are also re-calculated and refreshed on the first or second
day of each calendar month. This is mainly to fill in possible data
gaps in the previous month which has just passed
• Cost accruals is not a standalone feature and can only be used
together with consumption accruals
• Cost accruals are an indicative estimation only and should not be
used to replace any financial grade reporting

How is a data gap determined?

Envizi will determine gaps by looking at the total consumption and / or cost
for the month and the number of days covered. A gap is found if there is no
consumption / cost captured for the entire month or data captured does not
cover the whole month.

Which fields are accrued within a Data Type?

Each Data Type / Account style configured in Envizi captures multiple varied
fields based on each client's individual requirements.

Envizi will generate accruals for the Primary Consumption Measure field
and Total Cost field only.
• Using Electricity as an example:
o Accrued: Total kWh consumed and Total Cost
o Not Accrued: Other fields such as peak kWh consumption,
tax charges, etc.

When does data start to accrue?

• Envizi can commence accruals for accounts based on one of the
following 2 settings:
o Accruals to commence on the first observation of data in the
relevant account in Envizi
o Accruals to commence from the date the account opened
(by default if no account open date is configured, it will
accrue from the first observation of data).
 Figure 1: Data accrue from the first observation of data

When does data stop accruing?

By default data is accrued until the end of the previous calendar month, or
up to the account closing date if the account is being marked as closed. You
can also choose to configure a different accrual ending calendar month,
available options are:

• Accrue to Previous Month (default)

• Accrue to Current Month
• Accrue to 1 Month into the future
• Accrue to 2 Months into the future
• Accrue to 3 Months into the future
• Accrue to 4 Months into the future
• Accrue to 5 Months into the future
• Accrue to 6 Months into the future
• Accrue to 12 Months into the future
• Accrue to 18 Months into the future
• Accrue to 24 Months into the future

How do I stop my data from accruing?

• Accruals will not be calculated for any period after the 'Replaced On'
date of the account, thus it is crucial to set the 'Replaced On' date
for historical data accounts to avoid the accruals process running on
them. This is also referred to as 'closing an account'.
• Accruals will only run on accounts with data - if the account is empty
(without any account data items - no records) then no data will be
accrued.
• Users can suppress Accruals on individual records by explicitly
entering a '0' value into the cost or consumption field.
Do different Data Types accrue differently?
Yes. Data Types (Account styles) in Envizi can be configured as one of the
following and each of them has different accrual behaviour:
• Contiguous Data - Contiguous data relates to a continual data
stream (e.g electricity data) where gaps generally indicate a missing
bill
• Contiguous No Accruals - Same as 'Contiguous Data' but no accruals
will be generated for the account
• Event Data - Event data relates to sporadic data points recorded as
discrete points (e.g., fuel or flight data) where gaps do not generally
indicate missing data
• Event Data No Accruals - Same as 'Event Data' but no accruals will
be generated for the account
• Extrapolation - KPI data such as floor space, operating hours, etc.
which do not accumulate over time

It is crucial that Data Types are configured correctly in Envizi.

Contiguous Data Explained

For Contiguous data, gaps indicate that data is missing. By definition the
data should be continuous:

Figure 2: Contiguous Data - as of May

Figure 3: As soon as new data point (Jun) is recorded, previously accrued contiguous data is still valid
and preserved.

If the Account Style is set to ‘Contiguous Data No Accruals’ then no

accruals will be generated for the account. This option allows the
disabling of the accrual function for certain accounts, if they do not
require accruals.
Event Data Explained
For Event data the accruals functionality does not fill gaps as it cannot be
known with certainty if the gap relates to missing data or a period of non-
consumption. Data is only accrued for complete months forward from the
last month containing actual data:

Figure 4 - Event data is accrued from the last observation of actual data

Figure 5: - As soon as new data point (Jun) is recorded, previously accrued event data is no longer valid
and cleared from the system.

If the Account Style is set to ‘Event Data No Accruals’ then no

accruals will be generated for the account. This option allows the
disabling of the accrual function for certain accounts, if they do not
require accruals.

Extrapolation explained:
For Extrapolation data the accruals functionality fills in all historical gaps by
using the value of the most recent data point prior to the missing period:

Figure 6: Extrapolation data with missing gaps filled in

Accruals for Extrapolation data will always be generated regardless

of Accruals function being turned on/off in Envizi
The method of using historical window period to derive a daily
average does NOT apply to extrapolation data – the gap is filled by
using the value of the most recent data point prior to the missing
period.
When does accruals data refresh?
There are a few events that will trigger the calculation or re-calculation of
accruals in Envizi:
• After account items (records) are updated - including any addition,
modification or deletion of Account Items, either via manual data
entry or through automated connector file loading
• After account 'Opened On' or 'Replaced On' dates are applied
• Automatically at the beginning of each calendar month

Why accrual values keep changing every month even if there is no data
activity happening in the account?
This is an expected behaviour based on how accruals are generated and
accrual method it uses. Envizi accruals are dynamically generated and are
refreshed on the 1st day of each month. This approach ensures the accruals
are able to represent the latest data pattern in the account and aims to
provide an up-to-date estimation each month.

This also depends on the accrual methodology being used. For example, for
the 'Last 12 Months' method, it means at the beginning of each month, data
from the last 12 months (including the month that has just passed) are
used to generate the new accruals for the account. The accrual values will
likely to change every month to reflect the latest 12 months data pattern.
On the other side, accrual method such as 'Last Available Month' will always
use the last month's data, and if there is no new data gets entered into the
account, the accrual values will remain unchanged every month under this
method.

Accruals – Examples
Example 1 – Contiguous Consumption Data
Below is a worked example showing how 3 missing months of data would
be populated with accrued data using historical data.

Month No. of days in the month Consumption Units

Jan-15 31 200.0 kWh
Feb-15 28 200.0 kWh
Mar-15 31 150.0 kWh
Apr-15 30 200.0 kWh
May-15 31 200.0 kWh
Jun-15 30 200.0 kWh
Jul-15 31 200.0 kWh
Aug-15 31 200.0 kWh
Sep-15 30 200.0 kWh
Oct-15 31 kWh
Nov-15 30 kWh
Dec-15 31 kWh
For the period where we have data (1-Jan-2015 to 30-Sep-2015) the daily
average is calculated as follows:
• Total number of days of data = 273 days
• Total consumption = 1750 kWh
• Daily average = 1750/273 = 6.41 kWh/day

When the system fills in Oct, Nov, and Dec with accrued data it multiplies
the daily average by the number of days missing in the period.

Therefore:
• The Oct-2015 accrual = 6.41 kWh/day * 31 days = 198.7 kWh
• The Nov-2015 accrual = 6.41 kWh/day * 30 days = 192.3 kWh
• The Dec-2015 accrual = 6.41 kWh/day * 31 days = 198.7 kWh

Month No. of days in the month Consumption Units

Jan-15 31 200.0 kWh
Feb-15 28 200.0 kWh
Mar-15 31 150.0 kWh
Apr-15 30 200.0 kWh
May-15 31 200.0 kWh
Jun-15 30 200.0 kWh
Jul-15 31 200.0 kWh
Aug-15 31 200.0 kWh
Sep-15 30 200.0 kWh
Oct-15 31 198.7 kWh
Nov-15 30 192.3 kWh
Dec-15 31 198.7 kWh

Example 2 – Cost Accruals Example Using Last Invoice

An Electricity Account has the following cost data. The last bill has a start
date of 16-Mar-2016 and an end date of 15-Apr-2016 with $310 as the
cost. Assuming today is 1-Jun-2016.

To calculate the cost accruals:

• Cost Daily Average = Total cost of latest bill(s) / Total number of
days of latest bill(s) = $310 / 31 = $10 / day
• Cost Accruals for missing days in Apr-2016 = Total number of
missing days in the month * Cost Daily Average = 15 days * $10 /
day = $150
• Cost Accruals for May-2016 = Total number of missing days in the
month * Cost Daily Average = 31 days * $10 / day = $310