Retreating...What happens?

[Irish2]

If you choose the retreat option before the battle starts (when you have the option of controlling the battle yourself or let the battle be simulated), what happens to the retreating forces. They vanished on me and I saw my soldier on the strategic map crumple and whither away. Is there any advantage to retreating?

[Queeg]

Sometimes they escape unharmed. Sometimes they retreat with damage.