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How to setup delay recoverable payment plan with sample data flow. (Doc ID 1089004.1)

Last updated on DECEMBER 05, 2019

Applies to:

Oracle Incentive Compensation - Version 12.1.0 and later
Information in this document applies to any platform.


Payment plans are an optional way to set up advance or deferred payments (sometimes referred to as draws) and to define minimum and maximum payments.

This document shows a test case scenario of the affect of applying a delay recoverable payment plan with minimum and maximum value to payrun worksheets. The data flow examples will demonstrate how the process works.

Data Scenario
Resource has a payment plan to pay an immediate recoverable minimum of $250 with a maximum of $500 each period.

System Profile Current Setting
OIC: Pay by Transaction = No
OIC: Reset Balances Each Year = Yes

Transactions Flow
1. Setup non-recoverable payment plan
2. Assign the payment plan to the resource
3. Create manual transactions, load, and calculate JUN-00 period. Total commision is $100.
4. Create payrun for JUN-00 generates payment plan adjustment for $150 so total payment is $250.
5. Commission calculated for JUL-00 period is $1200.
6. Create payrun for JUL-00. July is starting a new quarter. Even though commission calculated is $1200,
    with delay recovery, the system generate a payment plan amount for $250 so total payment is $250.
    Earning difference shows $1050 which is $1200 commission calculated for Jul-00 minus $150 payment
    plan from June-00 payrun.
7. Commission calculated for AUG-00 period is -$20 (negative).
8. Create payrun for AUG-00 . Payment plan generated $250 so total payment is $250. Because of
    delayed recovery, the earning difference now shows $780 ($1050 from Jul-00 plus -$20 commission
    from Aug-00 minus $250 payment plan from Jul-00).
9. Commission calculated for SEP-00 period is $110.
10. Create payrun for SEP-00. September is end of the quarter so payment plan amounts will be
      recovered. Total commission for 3rd quarter (Jul-Sept) is $1290 = 1200 -20 + 110. Recovery amount
      is -$650 which is total of payment plan amounts from June, Jul, Sept = -150 -250 -250. However,
      because the plan pays Maximum of $500, system generated a NEGATIVE payment plan -$140 to
      decrease the payment amount so that total payment is only $500.

     Total Commission:                  Recovery Amount:                       Payment Plan Amount:
     July-00   1200                        Jun-00     -150                            Commission             1290
     Aug-00     -20                        Jul-00      -250                            Recovery Amount     -650
     Sep-00     110                        Aug-00    -250                                            Subtotal     640
     Total       1290                       Total         -650                              Maximum Payment -500
                                                                                                                 Payment Plan -140

11. Commission calculated for OCT-00 period is $50.
12. Create payrun for OCT-00 . October is start of new quarter. Commission earned for Oct-00 is only
      $50. Payment plan generated for $250. Earning difference $190 = $140 remaining from Sep-00 + $50
      commission from Oct-00. Commission recovery is delay till end of quarter.
13. Commission calculated for NOV-00 period is -$380 (negative)
14. Create payrun for NOV-00 . Payment plan generated $250. The earning difference is negative $440 =
      190 balance from Oct-00 minus 250 payment plan from Oct-00 plus minus 380 commission from
                         Earning Difference:
                         Earning difference from Oct-00   190
                                Payment Plan from Oct-00 -250
                              Current commission Nov-00 -380
                                                                 Total -440

15. Commission calculated for DEC-00 period is -$30 (negative)
16. Create payrun for DEC-00 . December is end of the quarter. Commission is now recovered. However,
      total commission for the quarter is a negative 360. Added to that amount is the payment plan recovery
      for $360. Total payment amount would be a negative 720. However, payment plan has minimum
      payment for a positive $250 so payment plan has to be $970 (720 + 250) in order to pay a positive 250.
          Total Commission:                       Recovery Amount:                  Payment Plan Amount:
          Oct-00     50                              Jul-00     140                           Commission          -360
          Nov-00 -380                              Oct-00  -250                          Recovery Amount -360
          Dec-00    -30                              Nov-00 -250                                         Subtotal -720
          Total      -360                              Total      -360                         Minimum Payment -250
                                                                                                                     Payment Plan 970

17. Commisison calculated for JAN-01 period is $10.
18. Create payrun for JAN-01. Payment plan ended in year 2000 so not effective for the new year 2001.
      The commission calculated is only 10. There’s no effective payment plan. The system wants to recover
      the FULL amount negative 960 from 2000 instead of continuing to carry over. Payment total is negative
      $960 ( 970 from Dec-00 payment plan plus - 10 from Jan-01 commission). The resource will have to pay back $960.

Note: The net effect is with delay recovery, the payment plan will pay the minimum amount till the last month of the quarter. On the last month of the quarter, total recovery of the previous payment plan amounts will be calculated against the total commission for the quarter. The balance of commission earned will be paid on the last month of the quarter UNLESS there is a maximum amount specified in the payment plan.

View full screenshots and complete sql output data flow: 1211DelayRecoverableTestCase.pdf


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