To add specification price adjustment rules to a contract go to Trading and then to the Physical-> Specifications tab.

Multiple specifications can be specified. Specifications entered at the contract level will automatically be copied to Operations -> Specification Adjustment.

Adding Contract Specifications

To add a specification to a Contract:

1. Click on to create a new line.
2. In Specification select the applicable Specification name.

*Specifications are setup in Reference Data -> Specifications.*

3. In Lower Include Rule enter the applicable lower include rule. This is used to set the lower limit of the specification adjustment rule.
4. In Lower Contractual Value enter the applicable lower contractual value. This is used to set the lower limit value of the specification adjustment rule.
5. In Contractual Value enter the contractual value of the specification.
6. In Upper Include Rule enter the applicable upper include rule. This is used to set the upper limit of the specification adjustment rule.
7. In Upper Contractual Value enter the applicable upper contractual value. This is used to set the upper limit value of the specification adjustment rule.
8. In Adjustment Type,

Range: Refer to Range Example.

Ratio: Refer to Ratio Example.

Amount: Refer to Amount Example.

Unit Rate(Vessel Option): Refer to Unit Rate(Vessel Option) Example.

9. In Adjustment Range Amount enter the range amount of the specification.
10. In Adjustment Range Amount enter the adjustment amount to be used.
11. In Adjustment Unit select the unit for the adjustment amount.
12. In Prorate Adjustment tick the box if the specification adjustment should be calculated on a prorated basis.
13. In Vessel Type enter applicable vessel type code. This is used when Adjustment Type is "Unit Rate (Vessel option)".
14. In Adjustment Rounding select the applicable adjustment rounding for the calculated adjustment amount.
15. Click to confirm creation.
16. To edit specification details after creation click to edit.

Example of Specification Adjustment Type: Range

For Range, indicate Adjustment Type: Range, Contractual Value and / or Lower/Upper Include Rule/Value, Adjustment Range Amount and Adjustment Amount.

For example, Contractual value = 34, Lower Contractual value = 32, Upper Contractual value = 36 Adjustment Range Amount = $0.50, Adjustment Amount = $1.00, Actual = 37.

The adjustment calculation is for every 0.50 the adjustment to the price will be $1. In this case there is an Upper Contractual Value. So the difference between the Actual and the Upper is 1 so $2.00 will be added to the physical price.

Example of Specification Adjustment Type: Ratio

For Ratio, indicate Adjustment Type: Ratio, Contractual value and / or Lower/Upper Include Rule/Value. If lower/upper rules are specified and the Actual value is above or below the upper/lower rules, the adjustment will be calculated using the contractual value, if present, and the actual value.

For example, Contractual Value = 4500, lower contractual value less than equal 4400, Actual value = 4300.

The adjustment amount will be (4500-4300 = 200) / 4500 * Physical Price

Example of Specification Adjustment Type: Amount

For Amount, indicate Adjustment Type: Amount, optionally Lower/Upper Include Rule/Value and Adjustment Amount.

For example, Adjustment Amount = $2.00 Lower Rule is less than equal 85 and Contract Value is 95.

The adjustment amount will be $2.00 if the actual value is 83.

Example of Specification Adjustment Type: Unit Rate(Vessel Option)

For Unit Rate(Vessel Option), indicate Adjustment Type: Unit Rate(Vessel Option), Adjustment Amount and Vessel Type. If the contractual Vessel Type is the same as the Actual Vessel Type, the adjustment calculated will be the Adjustment Amount.

For example, Adjustment Amount = $0.05/BBL, Contractual Vessel Type = LR and Actual Vessel Type = LR.

The adjustment amount will be $0.05.