Each of the virtual components that we have at this stage is then further split up based on how its cover period matches with the frequency of the nominee delivery pattern. For each virtual component up to three financial components may be created. Each financial component will apply for a specific interval during the period to which the virtual component applies.
If the virtual component does not begin on a day that can initiate a complete delivery period, a financial component is created to cover the period between the virtual component start date and the beginning of the first complete delivery period. This is known as a ramp-up financial component.
A second financial component may be generated to cover all complete cycles of the delivery frequency that can be achieved within the virtual component cover period. This is known as a recurring financial component.
A final financial component may be created to cover the period between the end of the last complete delivery period and the virtual component end date. This is known as a ramp-down financial component.
For example, the virtual component for nominee Linda covers the period from Wednesday 6th of July 2011 to Friday 29th of July 2011 and uses the delivery frequency Weekly by Check on Monday. Using the frequency of this nominee delivery pattern to split up the virtual component means that a separate financial component is generated to cover each of the periods listed below: