One of the cost management questions we hear most often from nOps customers is, “Can I use AWS cost and chargebacks to bring better accountability across business units?” The answer is yes. Chargebacks are very useful for managing financial processes and for allocating AWS costs across teams.

The nOps chargeback feature allows companies to deconstruct the cost of AWS resources and charge them back to cost centers, business units, or external-use services or products. In modern AWS cloud deployments, enforcing an accurate, consistent configuration across multiple account environments can be quite challenging. These scenarios usually end with unaccounted for non-budgeted expenses.

nOps takes the pain out of cost allocation for CFOs, VPs of Engineering, and Project Offices, by showing all active resources that are incurring charges.

In this blog post, we’ll talk about different types of chargebacks and how nOps can be used to create individual chargebacks for different teams and business units.

Common types of chargebacks

Chargebacks are about mapping cloud spend to the business. Chargebacks are initiated when the actual cost being incurred is allocated back to a budget or P&L. nOps can be used to create three types of chargebacks:

  • Cost center – Part of an organization that does not produce direct profit and adds to the cost of running a company.
  • Business unit – Can be a cost center, profit center, or investment center.
  • External-use service or product – Development costs incurred (prior to technological feasibility) for software that the organization intends to sell, lease, or market.

Creating chargebacks in nOps

To create a chargeback, three main areas need to be defined:

  1. Identify the chargeback name and the cost center, business unit, or external-use service or product. 
  2. Assign a budget. Budgets may be assigned monthly, quarterly, or yearly. Once a budget is created, different types of cost overrun or shortfall notifications may be selected. Identify and select the budgeted resources. nOps allows the creation of chargebacks by AWS account, Region, service, or tag name. 

Monthly, quarterly, and yearly review

Once all chargebacks have been created in nOps, nOps becomes your budget tracking and forecasting tool. While nOps allows you to view detailed cost information in near-real-time, the convenient nOps chargeback feature gives you the ability to review your chargebacks on a monthly, quarterly, and yearly basis. nOps will post budget notifications to your account according to your assigned categories. Of course, you can change and reassign categories as needed.

In conclusion

The nOps chargeback feature is a powerful tool for managing AWS costs, providing better accountability, and tracking/forecasting your budget. To get started with the nOps chargeback feature today, click here to sign up for a free trial of nOps (or click here to sign in to nOps if you’re already a user).

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