Financial instructions for benefit and liabilities are created when the Generate Instructions batch process runs as part of the Generate Instruments batch process. The financial instructions for a single benefit case can also be created as part of generating payments online.
Payment and liability financial instructions are created when one or more instruction line items are rolled up into a single financial instruction. Note that only instruction line items with the same category, nominee, delivery pattern, and currency can be rolled up together. For example, two payment instruction line items generated from the same financial component over two processing dates may be rolled up into a payment instruction. Or, a payment instruction line item may be rolled up with a deduction or tax adjustment line item (see Processing Deductions and Adjustments). However, if the Agency does not wish to roll up all the payment instruction line items from different programs into a single instruction, they can do so by adding programs/products to a payment group. This will ensure that only payment instruction line items belonging to a payment group will be rolled up into a single instruction.
For example, a nominee is paid $50, $75 and $100 from three different programs. If a payment group has not been defined, all the payment instruction line items will be rolled up into a single payment instruction of $225. However if it is required that the payment of $50 from a particular program should not be rolled up with payments from the other programs, this can be achieved by creating a payment group and adding the program/product whose payment should not be rolled up with payments from other programs. By doing so, the system will generate two payment instructions - one for $50 and another for $175.
A payment or liability instruction is created when the first instruction line item to be rolled up into the instruction is processed. Depending on the type of the remaining instruction line items, the amount of the instruction is then added to or subtracted from. For example, if a payment instruction line item is rolled up into a payment instruction, the amount of the payment instruction would be lessened when a related deduction instruction line item is rolled up into the same payment instruction.
When a payment instruction line item is rolled up, its outstanding amount is updated to zero and its status is changed to processed. These changes represent the fact that the instruction line item has been processed into a payment instruction and that a payment has been issued to the case nominee.
When a liability instruction line item is rolled up, its status is also changed to processed. Note, however, that its outstanding amount remains equal to the full amount of the liability. This indicates that the liability is still outstanding and that the amount is still owed to the organization. The outstanding amount will only be reduced or cleared when the liability is written off, reversed, or allocated against (see Maintaining Payments and Liabilities).