Invoices are generated for each customer account on its invoice day. Even if the customer is paying automatically via a credit card on file, the invoice will be generated as the record of charges.
Invoices are all initially generated in a Draft status. While in the Draft status the invoiced amounts are not yet recorded in the financial ledgers. This allows you to review the invoice and make changes to the applied charges as necessary.
When finalized, the invoice is "Posted" to the accounting ledgers. Any further changes (like a charge reversal) will generate accounting records and auditable entries.
Most often, you'll want to automate the posting of invoices, and perhaps review only the invoices for key accounts.
To automate the posting of all invoices, use the global setting in the Settings tab.
To control the posting for a particular customer, Manage the Customer Billing Settings.