The cost of the sale, spread over the benefit.
Aleq capitalizes the commission that won the deal and amortizes it across the period it benefits — not expensed in a lump the month you paid it.
Aleq derives how long the benefit runs. You confirm it.
Whether renewal commissions are commensurate — and so how long a commission's benefit really lasts — Aleq works out from the plan's two rates and holds for your confirmation. Once confirmed, three things happen automatically.
Aleq derives the amortization period from the plan on file: renewal commissions at half the new-business rate aren't commensurate, so the benefit runs past the 36-month term to the 48-month expected customer life — with that basis written down beside the asset. Change the plan and the period re-derives. From there, capitalization and monthly amortization run without a spreadsheet.
Every payout, on its own schedule.
Each commission carries its own capitalized balance and amortization, tied back to the rep and the contract that earned it. Aleq keeps the whole deferred-cost asset reconciled — what was paid, what's amortized, what remains — and writes off the balance the moment a contract churns.
| Payee · contract | Capitalized | / mo | Remaining |
|---|---|---|---|
| Allison W.C-7015 · 48 mo | $22,680 | $473 | $18,896 |
| Brent K.C-6904 · 48 mo | $31,400 | $654 | $21,582 |
| Marcus D.C-7102 · 48 mo | $15,000 | $313 | $13,750 |
| Priya N.C-6711 · 48 mo | $27,900 | $581 | $16,849 |
| These four commissions | $96,980 | $2,021 | $71,077 |
However you sell, the cost follows the deal.
New logos, renewals, channel, self-serve — what you capitalize and how long it benefits depends on the motion. Aleq runs the right treatment for each.
The cost of winning the deal — capitalized.
A commission paid to land a new contract is an incremental cost of obtaining it, so it's capitalized and amortized over the period it benefits — often longer than the initial term, because the customer relationship outlasts it.
- Incremental cost paid only because the deal closed, so it's capitalized.
- Period of benefit amortized over expected customer life.
- Loaded payroll taxes on the commission ride along.
Renewal pay turns on the commensurate test.
If a renewal commission is commensurate with the new-business commission, the relationship is already captured and the renewal cost is expensed. If it isn't, the renewal is a fresh asset. Aleq runs that test from the plan on file — a renewal rate at 90% or more of the new-business rate is commensurate — and writes the ratio and the conclusion down beside the entry.
- Commensurate a renewal rate at 90%+ of the new rate is expensed as incurred.
- Not commensurate a lower renewal rate means the renewal is capitalized separately, over the expected customer life.
- The ratio test computed by Aleq from the plan's two rates; the basis is stored with the determination.
Partner referral fees follow the same rule.
A referral fee or channel payout paid to win a deal is just as incremental as an internal commission. Aleq capitalizes it against the same contract and amortizes it over the same period of benefit — one schedule, internal and external alike.
- Referral fees incremental to the deal, so they're capitalized.
- Same period amortized over the customer's expected life.
- One schedule internal and partner costs, side by side.
Short-lived deals are expensed as incurred.
Where the amortization period would be a year or less, the ASC 340-40 practical expedient lets you expense the cost as incurred. Aleq applies it by policy — no asset to set up for a deal that won't outlive the year.
- One-year expedient applied where benefit ≤ 12 months.
- By policy elected and applied consistently.
- No micro-assets small short-life costs expensed cleanly.
What controllers and auditors ask.
Put your commissions on Aleq.
Connect payroll and your CRM. Set the period of benefit per plan and watch Aleq capitalize the cost of every deal, apply the one-year expedient where you've elected it, and write off the balance the moment a contract churns — the deferred-cost roll-forward tied out.