REFUND PROCESS WITH AUTOINVOICE

Hi,

Could anyone explain exactly as to how the Auto Invoice Program works? As, I am trying to Import transactions from a SAP system into R12 AR and have automated Refunds processed on those. Here the Import file has Debit memo's on Customer's, and have to have Credit Memo's created for 100% refund and the Payment's to be processed in AP.  NO NEED OF RECEIPTS.

I understand the basic setup steps, like defining the receivable activities, transaction source and types.

However, I would like to know how AR transfers the Refund amounts on Customers to AP. What program exactly does that and how would we know when Invoices on AP side are created.