The following diagram shows the possible lifecycle of an adjustment.
Manually created adjustments are initially created in the Incomplete state. Adjustments in this state don't have a financial transaction. This means, you can change the amount at will.
Generate the adjustment from the maintenance page causes the adjustment to become Freezable. At this point a financial transaction is created for the adjustment. The financial transaction contains the adjustment's effect on the general ledger and on the taxpayer's payoff and current balances. If the adjustment amount is calculated the algorithm on the adjustment type's Generate Adjustment event controls how the adjustment's amount and calculation details are generated. If the adjustment is calculated, you must specify the calculation date, to use for calculations that are effective dated.
In the very rare situation when the system cannot generate the financial transaction because of inconsistent setup data, the adjustment is moved to the Error state. You may regenerate the financial transaction after correcting the source of the error. You may also delete such an adjustment.
Freezing the adjustment causes the adjustment and its financial transaction to be Frozen. While in this state only a few things about an adjustment may be changed:
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The effective date of the adjustment's FT.
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Whether the adjustment appears on a taxpayer's bill, if applicable.
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The accounting date used to derive the general ledger accounting period(s) to which the financial transaction is booked.
Automated adjustments may be created as frozen. If an adjustment is generated as a result of another process, such as form creation or penalty and interest calculation, the adjustment will be created in Frozen status.
Adjustments may require approval. If the adjustment type referenced on the adjustment has an approval profile, the user is not able to freeze an adjustment but rather must submit the adjustment for approval. Refer to The Big Picture of Adjustment Approvals for more information.
An adjustment may be Canceled to remove its financial effect from the system. Canceling an adjustment causes the generation of another financial transaction. This new financial transaction reverses the financial impact of the original adjustment. For bill oriented taxes, the impact of the cancellation may appear on the taxpayer's next bill. You may view both the original financial transaction and its cancellation on the Adjustment page.