Chargeback that adds up: license and cost reporting per client tenant

There is a routine in almost every MSP that nobody defends but everyone has: the monthly reconciliation. License counts are exported from the M365 admin center per client, Azure consumption is pulled from Cost Management, changes since last time are picked out of the ticketing system, and a spreadsheet translates it all into invoicing data. The routine is fragile on both edges: bill too little and you lose the margin; bill too much and you lose the trust. And the source of error is structural — the numbers are produced in systems that do not know about each other.

The root problem is that the license and the identity behind it live apart. A license is a cost in one system and an assignment in another, and the mapping "which client, which company, which user" has to be maintained by hand. Every hire, departure and reorganisation at the client is an opportunity for the two pictures to drift apart.

Entra Logic keeps them in the same system. The sync service already maintains the complete picture per tenant — users, license assignments, cost data — and cost and license reporting is allocated to company and client in the same surface that manages the identities behind the cost. When an order assigns a license, the cost consequence is registered against the right client in the same moment, because it is the same event. There are no two pictures to reconcile.

Be precise about the scope, because precision builds credibility: this covers Microsoft licenses, Azure consumption and applications connected via SSO through Entra ID. Shadow IT bought outside SSO on a company card is not captured — and we do not claim it is.

Two gains follow that MSPs routinely underestimate.

The first is unused licenses as a systematic finding rather than an accidental discovery. When the license picture and the identity picture are the same picture, "paid licenses assigned to disabled or vanished users" is a running lookup per client. That is money you can choose to hand back to the client — as loyalty — or use to fund your own delivery in the business case the client sees.

The second is negotiating power. At the renewal of a Microsoft agreement or within a CSP programme, consolidated, accurate insight into actual license usage across all client tenants is a real starting position — you negotiate on numbers, not on estimates. The product provides the data; the negotiating is still yours to do.

The same applies to acquisitions and growth. When you take on a new client — or your client acquires a company — the first question is always "what do they have, and what does it cost?" With continuous sync, the answer is days, not months of mapping.

Start by measuring today's state: how many hours go into invoice reconciliation per month, and when did you last find a license discrepancy by accident? Both numbers should be zero. One of them can be.