AWS Billing and Cost Management is the service that you use to pay AWS bill, monitor your usage, and budget your costs.

AWS provides Cost Explorer tool which allows filter graphs by API operations, Availability Zones, AWS service, custom cost allocation tags, EC2 instance type, purchase options, region, usage type, usage type groups, or, if Consolidated Billing used, by linked account.

Budgets can be used to track AWS costs to see usage-to-date and current estimated charges from AWS.

Budgets use the cost visualization provided by Cost Explorer to show the status of the budgets and to provide forecasts of your estimated costs.

Budgets can be used to create CloudWatch alarms that notify when you go over your budgeted amounts, or when the estimated costs exceed budgets

Notifications can be sent to an SNS topic and to email addresses associated with your budget notification.

Tags can be used to organize AWS resources, and cost allocation tags to track the AWS costs on a detailed level.

Upon cost allocation tags activation, AWS uses the cost allocation tags to organize the resource costs on the cost allocation report making it easier to categorize and track your AWS costs.

AWS provides two types of cost allocation tags,

1. an AWS-generated tag AWS defines, creates, and applies the AWS-generated tag for you,

2. and user-defined tags that you define, create,

Both types of tags must be activated separately before they can appear in Cost Explorer or on a cost allocation report.

To enable the AWS tags: Log in to AWS console using the master account and activate the AWS generated tags in the Billing and Cost Management console. Billing -> Cost Management.

To FIlter the user Tags: In the Cost Allocation Tags console of the master account, select the Department tag in the User-Defined Cost Allocation Tags area and activate it. The tag starts appearing on the cost allocation report after it is applied but does not appear on earlier reports.

Consolidated billing enables consolidating payments from multiple AWS accounts (Linked Accounts) within the organization to a single account by designating it to be the Payer Account.

WARNING: This component was replaced with the "Organization".

Consolidate billing

1. is strictly an accounting and billing feature.

2. allows receiving a combined view of charges incurred by all the associated accounts as well as each of the accounts.

3. is not a method for controlling accounts, or provisioning resources for accounts.

Payer account is billed for all charges of the linked accounts.

Each linked account is still an independent account in every other way.

Payer account cannot access data belonging to the linked account owners, however access to the Payer account users can be granted through Cross Account Access roles.

AWS limits work on the account level only and AWS support is per account only.

Consolidated Billing Process

Owner of the paying account simply needs to send a request to the account owner from the Consolidated Billing page.

If the linked account owner accepts the request, the linked account becomes part of the consolidated bill.

Process cannot be initiated from the linked account

Consolidated Billing Scenarios

Consolidated Billing Benefits

For billing purposes, AWS treats all the accounts on the consolidated bill as if they were one account.

AWS combines the usage from all accounts to determine which volume pricing tiers to apply, giving you a lower overall price whenever possible.

Volume Discounts Example

All Linked accounts on a consolidated bill can receive the hourly cost benefit of EC2 Reserved Instances purchased by any other account.

Linked accounts receive the cost benefit from other’s Reserved Instances only if instances are launched in the same Availability Zone where the Reserved Instances were purchased.

Capacity reservation only applies to the product platform, instance type, and Availability Zone specified in the purchase.

For e.g., Bob and Susan each have an account on Bob’s consolidated bill. Susan has 5 Reserved Instances of the same type, and Bob has none. During one particular hour, Susan uses 3 instances and Bob uses 6, for a total of 9 instances used on Bob’s consolidated bill. AWS will bill 5 as Reserved Instances, and the remaining 4 as normal instances.

Paying account should be used solely for accounting and billing purposes.

Consolidated billing works best with Resource tagging, as tags are included in the detailed billing report, which enables cost to be analyzed and decomposed across multiple dimensions and aggregation levels.

Paying account owners should secure their accounts by using MFA (multi-factor authentication) and a strong password

Managing Billing