Purpose: This document aims to provide partners with a comprehensive understanding of the commission process and guidelines for interpreting commission reports.
Commission Process Overview
Timing: Most merchant billing is completed around the 10th of each month for the processing activity in the prior month. Commissions are paid one month in arrears. For example, Commissions for the merchant processing month of November are paid at the end of December.
Report Delivery: By default, commission reports are emailed via [email protected] on the last business day of the month by 4 PM CST. These default reports are provided in an Excel format and typically consist of three tabs:
- Commissions- an overall view of each commissionable product
- Adjustment Fee Description- a view of any corrections to prior commission payments
- Reseller Report- a detailed view of commissions from credit card services
Reports are emailed on the same day ISOs receive the payout
Reading the Commissions Tab
Know Your Buy Rates
Before interpreting the commission report, ensure you are familiar with your buy rates and revenue share. This information will be located on your ISO/ISV agreement.
Fee Section
There are 4 sections to each Fee, beginning at Column I, that you may receive commission on. These sections are:
- Qty - Quantity of commissionable units (ex. number of transactions)
- Sell Price - the per unit price that was collected from the merchant
- Commission - the total commission earned per unit
- Extended (Total) - the total of commission received for the product (Qty X Commission)
Example
- Consider an ACH Debit Transaction where the ISO/ISV buy rate cost is $0.20 with a revenue share of 30%
- If the merchant conducted 2 transactions at $0.50 and the ISO/ISV cost is $0.20, the calculation would be as follows:
- ISO/ISV Profit = (Sell Price-Buy Rate Cost) * Qty * Rev Share %. In this example, ($0.50-$0.20)*2*.30.
Looking at it another way:
- (Sell Price - Cost) = ($0.50 - $0.20) = $0.30 per transaction
- Commission = (Profit per transaction * % of RevShare) = ($0.30 * 30%) = $0.09 per transaction
- The final commission (extended column) is calculated as $0.09 per transaction times 2 transactions.
- Note, each row is a different merchant ID/location. The totals at the bottom of each applicable column will reflect the sum of all commissions for that product.
Reading the Adjustment Fee Description Tab
Adjustments
- If refunds are made at the merchant level, commissions will be adjusted.
- For example, if a $15.00 monthly fee is refunded to the merchant for two months, resulting in a total refund of $30.00, accounting will adjust the paid commissions accordingly.
Reading the Reseller Report Tab
Reseller Report
- The Reseller Report provides detailed information on credit card transactions only.
- Columns A-G— includes ISO ID, Location ID, Merchant Name, $ Volume (Debits/Credits), Quantity (Debits/Credits).
- Columns H-L— consist of what CSG Forte bills the merchant—Discount Billed, Item Billed, Interchange Billed, Dues & Assessments Billed and Total Billed. **If CSG Forte is billing the reseller, these columns will be blank.**
- Columns M-Q— consist of what the ISO/ISV expense is— Interchange Expense, Dues & Assessments Expense, BIN Expense, Item Expense, and Total Expense.
- Columns R-S— includes Net Profit and Commissions
- To calculate Net Profit, subtract the Total Expense (Column Q) from the Total Billed Amount (Column L).
- Commission calculation remains consistent with other transactions: Selling Price minus Cost equals Profit, and Profit multiplied by the percentage of revenue share equals Commission.
- NOTE: If a merchant is not processing, not generating anything, the merchant ID (MID) will not show up on the Commission report even as $0.
Conclusion
This training document provides partners with essential insights into the commission process and how to interpret commission reports effectively. Understanding Buy Rates, Timing, Adjustments, and the Reseller Report will ensure accurate reconciliation of commission and a clearer understanding of your earnings. If you have any further questions or need assistance, please contact partnersupport@forte.net or call 866.290.5400 Option 2.