Recurring Billing- Enhanced billing capabilities in R12.2.

6 EBS Order Management

Kishor Genikala
Oracle India Private limited

Abstract
Recurring Billing enables business to bill its clients in multiple invoices over a period of time as per the agreed billing plan. Such
schedule of amounts & dates is generally known as Billing Plan, and is often pre-decided but it can be changed in due course of
time. This feature addresses recurring billing requirements of customers who sell subscriptions and rental, and send multiple
invoices to their clients over certain period of time depending on acceptance letter from customer or as per the agreed date. Each
such invoice contains certain part of total sales proceeds or an agreed value. This paper provides an insight into business
requirements, Solution overview, Key features which includes capturing fixed/flexible billing plans to bill order lines in multiple
invoices, capabilities to terminate the billing with options to refund via RMAs or without refund, Key Setups, Process Flow, Data
Flow.

Scope
Business Need
Solution Overview
Process & Data flows
Key Setups
Solution Details
Solution constraints and limitations
Common Setup Issues

I. Business Need
There was a requirement from various customers to enhance Order Management billing capabilities so that invoicing can be done
over a period of time based on business events/dates.
For example, in some industries (e.g. Oil & Exploration, or Infrastructure & Constructions) deep drilling or other heavy industrial
equipments are maintained and given for a rent for a specified period or without a pre-specified period i.e. till clients return the
equipments. Rent/payment amount is predetermined and can be increased during the contract period. This is unlike traditional
flow of shipping and immediately invoicing the customer.
Another example, in cloud-computing or SaaS business, subscriptions are sold for a specified amount per user and payments are
received monthly/weekly. Subscription amounts can be increased or decreased, and similarly subscription quantity (number of
users) can be increased /decreased as per clients requirements.

II. Solution Overview

Recurring Billing enables business to bill its clients in multiple invoices over a period of time as per the agreed billing plan. Such
schedule of amounts & dates is generally known as Billing Plan, and is often pre-decided but it can be changed in due course of
time.
In recurring billing, there will be only one shipment/fulfillment line (source order line), and customer is invoiced for this line
through different bill-only lines (billing lines). The sum total of amounts on billing lines may or may not match the amount
(extended price) on source order line depending upon category of billing plan. Example, in case of rental flow, the sum total of
amounts on billing lines may exceed the line amount on source order line. This is like client is billed $100 for next twelve months
for using drill machines, and at end of twelve months, the client may ask for extension of three more months. And in another
example of Pay in Installments flow, the sum total of amounts on billing lines will match the line amount on source order line
e.g. product is sold for $1000 and client is allowed to pay in two installments of $600 and $400.

III. Process Flow & Data flow

System will capture billing information as billing plan for source order lines by using Actions > Billing Plan on sales order Lines
screen. User will specify amount and date for each billing plan lines. Against each billing plan line defined in billing plan, system
will automatically create billing lines through concurrent program Create Billing Lines.
Below mentioned diagram represents overall process flow:

Steps Order Management Suite Accounts Receivable (AR)

Source Define Fulfill & Generate

#1
Order Billing Invoice Invoice
Line Plan / Order line document
Installment
s
Run Create Billing
#2 Lines Conc Prog

Invoice Generate Invoice

Order Lines
#3 Order Lines documents
(Billing Lines)

Data Model Changes:

New Tables Added:
OE_BILLING_PLAN_HEADERS_ALL To define and store Billing Plan Header
OE_BILLING_PLAN_LINES_ALL To define and store Billing Plan Lines
Tables Modified:
OE_ORDER_LINES_ALL Additional columns added like 1. Require_Billing_Validation, 2. Billing_plan_header_id and 3.
Source_order_line_id

Below mentioned diagram represents the data flow:

IV. Key Setups
Operating Unit level system parameter Enable Recurring Billing controls this feature. This system parameter takes
Yes or No values. Null/blank will be the default value and it means No.
Add form function "OM HTML UI : Recurring Billing" to the responsibilitys menu, to provide access to the OAF
page for Billing Plan definition.
Schedule Create Billing Lines concurrent program. This program reads billing plan associated with source order lines,
and create billing lines against eligible billing plan lines
Setup a Defaulting Rule, for defaulting Line Transaction Type (Bill Only Line type) for the billing lines.
Users are expected to create specific header and line transaction types for each kind of rental/subscription/installment
financing flows. Default Line Transaction Type can be specified on header transaction type or through defaulting rules,
so that system can default the same while creating billing lines.

V. Solution Details
Under this solution, user is provided with the capabilities to bill order lines in multiple invoices for the subscriptions and rental
scenarios. This solution provides capabilities to terminate the billing with options to refund via RMAs or without refund. This
design leverages most of the native R12 standard functionality of EBS Order Management. Below mentioned are the key entities
of the solution.
Billing Plan: Capture billing plan information on Action> Billing Plan window. This is an OAF page which can be launched
from both Forms & HTML UI. Billing Plan can be attached to each sales order line. For each Billing Plan, there is an option to
bill indefinitely until termination or generate a fixed/pre-defined number of bills. If the number of billing plan lines is certain or
known when creating billing plan, then it is a case of Fixed Number of Billing Plan Lines (for exp. Pay in Installments flow). If
the number of billing plan lines is unknown when creating billing plan, then it is a case of Indefinite Number of Billing Plan
Lines (for exp. rental flow). For Fixed Number of Billing Plan Lines option, the billing amount for each billing plan line can be
identical or not. For Indefinite Number of Billing Plan Lines option, the billing amount for each billing plan line has to be
identical. A billing plan can be quickly defined by entering Billing Period (e.g. weekly, or monthly), Billing Frequency (e.g. 3,
or 25), Start Date, Billing Amount etc.
A new attribute, Billing Validation has been added to the sales order line. This determines whether or not the sum of the bill
amounts on the Billing Plan should equal the sales order line amount.
There is an option to generate the first bill with the source order line to which the Billing Plan is attached.
Billing Plan Statuses:
There are different statuses a billing plan can go through.
Open means billing has not started yet as per the billing plan. In this status, Billing Plan window is always editable.
Billing in Progress means billing has started as per the associated billing plan. For this status, at least one line on billing plan
should get billed. In this status, Billing Plan window is still editable.
Closed means billing is complete for all lines in the billing plan window. In this status, Billing Plan window is non-editable.
Terminated means user has manually terminated the billing plan to stop further billing, or an RMA (with full qty) has been
created against the source order line. This status is as good as Closed. Billing Plan window is read-only in this status.
Review required means user is expected to review the billing plan because changes on source order line with respect to qty &
amount has happened, or RMA with partial qty has been created when billing is in progress. This gives user an opportunity to
review & update the billing plan with respect to bill dates, amounts etc.
Billing Plan is editable till its status is set to Closed or Terminated.
Modifying the Billing Plan:
For Fixed Number of Billing Plan Lines option,
The billing plan parameters of Billing Period, Billing Frequency, Start Date, Billing Amount and Number of Billing
Plan Lines are not saved and are used for defaulting billing plan lines only.
If billing has not started, users can enter new values in these parameters and re-default in new billing plan lines and
delete existing billing plan lines
Regardless of whether billing has started or not, users can always directly update billing plan lines
If billing has already started, users can never update billing plan lines that have already been billed
For Indefinite Number of Billing Plan Lines option,
 The billing plan parameters of Billing Period, Billing Frequency, Start Date and Billing Amount are saved
These parameters can always be changed and the new values will be applicable to billing plan lines to be created in the
future
Users can never update billing plan lines that have already been created
Billing Lines:
Billing lines will be created, once the source sales order line is closed. A new concurrent program Create Billing Lines
generates bill-only sales order lines (Billing Lines) on the due date of each bill as specified on the Billing Plan. The bill-only
sales order lines are created in the same sales order as that of the source order line to which the Billing Plan is attached.
Billing Amount of any billing plan line, which is marked as Bill First Billing Plan Line with Source Order Line, will be stored
in Service First Period Bill Amount column on source order line. For source order line, it is the "Service First Period Bill
Amount" column that is invoice interfaced to AR, not the Extended Price (USP * Qty) column. If Bill First Billing Plan Line
with Source Order Line is not selected, then null/zero is stored in this field. The same column is used to store the billing amount
for all the other Billing lines, which will be interfaced to AR. Freight Charges & Taxes on source order line, will be invoiced as
per the existing standard functionality in R12.
Billing lines will have the same ordered quantity as that of source order line, and is not allowed to change. Billing lines will have
zero (0) value in USP and ULP fields and is not allowed to change, which means line amount (Extended Price) will also be
zero for such lines.
System defaults the Line Transaction Type for Billing lines, as per standard product functionality. In general business scenario,
customers create header and line transaction types for each required business flow. This helps in specifying defaulting attributes
for required flows. For Recurring Billing flow also, customers can create separate header- & line-workflows and transaction
types for each type of business flow. Default Line Transaction Type can be specified on header transaction type or through
defaulting rules.
Source Order Line:
If source order line is open (i.e. not fulfilled), then user can cancel the source order line as per standard R12 functionality. In this
case the associated billing plan is purged. Modification of Line Amount on source order line is allowed as per the workflow
attached to the source order line. In other words, modification till re-pricing at fulfillment is supported.
At invoicing/closing point, irrespective of Billing Validation, if there is a change in the order line amount since the billing plan
was last updated, then system sets the status of the billing plan to Review Required. This is to attract attention of the user so
that they can modify billing plan if need be. In addition, the system routes the source order line workflow to Invoice Interface
Eligible incomplete data workflow activity. At invoicing/closing point, onus is on user to resolve the mismatch. Once user
completes the review, billing plan status can be set back to Open by clicking on Review Complete button. User can
immediately push the line through invoicing and close workflow activities by using standard Progress Order feature from SO
pad > Action button. Alternatively, the line will be pushed by Workflow Background concurrent program.
After billing has commenced, billing can be manually terminated by the user. After billing has commenced, a referenced RMA
for the full quantity on the source order line will automatically terminate further billing. After billing has commenced, a
referenced RMA for part of the quantity on the source order line will automatically place the Billing Plan on Review
Required status. The future billing amount should be adjusted to account for the partial return and confirmed by the user before
billing can be recommenced.

VI. Solution Constraints and Limitations

ISO flow is not supported with this feature.
Other fulfillment flows like drop-ship and back-to-back are not impacted by this feature.
Models (Kit, ATO, PTO, or Hybrid) are not supported in this release.
RMAs (whether referenced or non-referenced) cannot have billing plan associated with them
Versioning of Billing Plan is not supported
HVOP is not supported with this feature
Copy: Users are not be given the ability to select "Billing Plan" as an option in Copy Order/Copy Line flows in both
Forms and HTML UIs
Note: These limitations are listed as per the current design of R12.2.6 enhancement.

VI. Common Setup Issues

Issue#1:
Not able to see billing plan in Actions in Sales Order form even though system parameter Recurring Billing is set to Yes.
Probable Cause: The form function of the Billing Plan OAF page "OM HTML UI : Recurring Billing" is not added to the
corresponding responsibilitys menu.
Resolution: Add the form function "OM HTML UI : Recurring Billing" to the corresponding responsibilitys menu.

Issue#2:
Billing Line created in Sales Order with a different line type instead of Bill-only.
Probable Cause: The defaulting rule setup for line type might be missing.
Resolution: Modify the defaulting rule setup for attribute Line Type to default bill-only line type for Billing lines

Issue#3:
Even though Billing Validation check box is not selected, At invoice of Source Order line, Source Order line is set to Awaiting
Invoice Interface Incomplete Data and Billing plan goes to Review Required status if Extended price is not equal to billing
amount total.
Probable Cause: This is expected behavior, so that user can review Billing Plan amounts if the extended price on source order
line is updated after creating the Billing plan.
Resolution:
Progress Order on Source Order Line.

Conclusions
It is our desire that this paper has helped you to enable Recurring Billing functionality (Enhancement in R12.2.6) in Oracle Order
Management. We hope that you are now better equipped to create necessary setups, understanding of key entities, Defining
Billing plans and execution of associated flows in Recurring Billing. In addition, if you encounter a problem that requires
assistance, please remember to call Oracle Support. They may have seen the issue before and may already have a solution for the
issue!

About the Author

Kishor Genikala is a Principal Software Engineer, EBS Mfg. COE at Oracle India Private Limited. He has 15 years of Techno
functional Experience in EBS applications and 3 years of Domain Experience in Manufacturing Industry.