Adjustments and Updating P&I

The base product provides adjustment type plug-ins to bring P&I up to date when an adjustment is frozen or canceled. Implementers should carefully consider which adjustment types require these algorithms.

• Certain adjustments are created from the P&I calculation, for example the penalty and interest charges and waiver charges. For these types of adjustments, the algorithms to recalculate penalty and interest when freezing or cancelling should not be plugged in on the adjustment type.

• Certain adjustments where P&I should be brought up to date are part of a business scenario where several adjustments are created for various charges. For example, when a tax form is processed, adjustments may be created for the tax assessment due and for the withholding credit and for refundable tax credits. The system should wait until all the adjustments are created before bringing P&I up to date, otherwise a lot of unnecessary calculations will occur. These types of adjustments should not reference the algorithms to recalculate penalty and interest when the adjustment freezes or is canceled.

The algorithms should be used for adjustments like manual penalties where penalty and interest is affected and the adjustment is not created as part of a greater process. The assumption is that an adjustment type would either have both algorithms or neither algorithm. In other words, if the creation of a given kind of adjustment affects penalty and interest, then cancelling that type of an adjustment should also affect penalty and interest.

Also note that when an assessment adjustment is canceled, all related penalty and interest adjustments should be canceled as well. The P&I calculation does not cater for cleaning up penalty and interest for canceled assessments.