Create an Extended Warranty Contract with Monthly Billing From Order Management

In releases prior to 12.2.2, when an Extended Warranty is invoiced through Order Management, the invoice amount is for the entire duration of the Extended Warranty. Hence, Flexible billing schedules are not possible in the prior releases.

As from release 12.2.2, additional billing options have been introduced for Extended Warranties which allow flexibility as to how billing is done.  The options are as follows:

• Retain the existing behavior of generating an invoice for the entire duration from Order Management.
• Generate the invoice for the first installment from Order Management and for the subsequent installments from Service Contracts.
• Generate invoices for all installments from Service Contracts. In this scenario, Order Management does not generate any invoices.

For orders that are billed in multiple installments over the duration of the service contract, the billing schedule can be specified in the Billing Profile, which is a new field on the order line. To support this enhancement, several new fields have been added to the order line. 

The following attributes are managed in Order Management and interfaced to Service Contracts:

Service Billing Option:

A list of values (LOV) field and the values are maintained in Service Contracts.The following values are available:

Full Billing from Order Management:  When a contract (Extended Warranty or Service Agreement or Subscription Agreement) is created from OM; the contract is billed completely from OM. This doesn’t allow users to have multiple billing periods.

Full Billing from Service Contracts:When a contract (Extended Warranty or Service Agreement or Subscription Agreement) is created from OM, the contract is billed completely from OKS.This allow users to have multiple billing periods.

First Period Billing from OM, subsequent from Contracts: First period is billed from OM and the rest from OKS.  Periodic Billing Amounts are calculated and maintained based on the amount billed in OM. This allow users to have multiple billing periods.

Service Billing Profile:

The Service Billing Profiles are templates used to specify
- Simple periodic billing schedules
- Accounting rules
- Invoicing rules.
Service Billing Profile information is specified for the subscription or service item in the Sales Order line.

Service Coverage Template:

 Optional, A list of values (LOV) field and the values are maintained in Service Contracts.

Optionally, select from the list of values that displays all active templates. Service Contracts uses this value for creating the contract. The field is enabled only for Extended Warranty lines. We cannot edit or update the coverage template details in Order Management. If we do not specify a template in Order Management, then Oracle Service Contracts populates the value (taken from the Item Master).  We can update the coverage template on the order line when line status is either 'Entered', 'Booked' or 'Awaiting Fulfillment' and it is yet to be interfaced to Service Contracts.
Ensure to define service coverage templates in Oracle Service Contracts.

Contract Effectivity: 

Service Start Date (e.g. 01-JAN-2014), 

Service End Date (e.g. 31-DEC-2014), 

Service Duration (e.g. 12) , 

Service Period (e.g. Months);
First Period Bill Amount (calculated and displayed);
First Period End Date (calculated and displayed).

Posted in: Functional,Oracle Notebook,Oracle Service Contracts