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Inactive Users not consuming Licenses (M365 Connection)

Hey everyone,

We've connected FNMS with the M365 tenant and receive all user/license/consumption data successfully. Users are been mapped with existing AD user objects.


Unfortunately, allocated users with the status "inactive" are not consuming license entitlements. For most on-prem products this is good, but for allocated M365 users this is wrong. Any user that is assigned with a license in M365 portal, needs to be reflected as a license-consuming user.


Where can I change the setting, that allocated and inactive users are consuming the license?


Thank you and best regards


Softline Group is Europes leading independent expert for SAM and ITAM.
(3) Replies

Why do you have licenses assigned to Inactive users? Inactive Users cannot consume a license.  That is one of the great features of Flexera. We don't have to remove the licenses from users who are no longer active, those licenses are removed automatically.

Erick Hacking, CSAM, CHAMP
IT Software Asset Manager, Lead Sr.

Hi Erick,


Totally agree that these users should be removed from license consumption. Nevertheless, the source of the license allocation is the M365 portal. Once a user is assigned with an M365 subscription, this license is not free anymore. You have to pay for and you cannot use it for anybody else.

Hence, from transparency perspective these users need to be allocated and counted as consumed - even though they are inactive.

From optimization perspective, they should be deallocated or removed from subscription. Thats right.


For optimization purpose we've created a report to reflect license allocation from inactive users. In the license within management section, the goal is to reflect transparency.

Softline Group is Europes leading independent expert for SAM and ITAM.


This is one of the SaaS management use cases that we touched on as part of a recent webinar: Technology Value Optimization for SaaS Applications 

The SaaS management capabilities facilitate the reclamation of off-boarded employees by combining the information from the HR roster and the Microsoft 365 API data sources: