# Tracking and accounting for AI provider credits

Credits are how many AI startups pay for inference in their first year: startup programs, cloud marketplace commitments, prepaid top-ups. They're also easy to lose track of.

## Three questions to answer every month

1. **What's left?** Per provider and per grant.
2. **When does it run out?** At the rate you're using it, and when does each grant expire?
3. **What's at risk of expiring unused?** That's money left on the table.

The provider consoles show a balance, but rarely the expiry calendar across grants, and never what your product's burn means for the date you start paying cash.

## How drawdown works

Providers apply usage to credits before charging your card. A sensible model, and the one Veqen uses, is first-expiring first: each day's usage reduces the earliest-expiring active grant until it's exhausted, then the next. When a grant expires, its remainder is forfeited.

## When the credits run out

If $25,000 of promotional credits covers six months, your gross margin is overstated for six months, then drops overnight. Track usage *as if* you were paying, so pricing decisions are made on real costs. In Veqen, every call is priced at list rates (or your negotiated [custom prices](/docs/custom-prices)) whether or not credits cover it, so dashboards and budgets always show the real cost.

## In the books

- **Prepaid credits** you paid for are a prepaid expense, a current asset. Each month, usage they cover moves from the asset to expense.
- **Promotional credits** usually aren't recorded as an asset, and the usage they cover isn't an expense.
- **Expired prepaid credits** are written off when they expire.

See [How to account for AI inference costs](/guides/accounting-for-ai-costs) for the full month-end entry.

## With Veqen

Record each grant on the [Credits](/docs/credits) page. Veqen draws it down first-expiring first, from what the provider billed where a cost connection exists and from tracked spend otherwise, warns owners, admins and finance 30 and 7 days before credits with a balance expire, and books the drawdown in the monthly close.