Understand NAV Based Rules Used to Adjust Existing NAVs

You can use a NAV based adjusted NAV expense rule to create an exception rule that subtracts an exception amount from the underlying NAV component defined in a variable expense. 

You can set up an adjusted NAV based expense rule with exclusion rule criteria based on a ledger account range, security ID, long/short indicator, security type, processing security type, and sub security type. For example, when the system processes a variable expense with a NAV Component based on Prior Day Total Net Assets, you can exclude expenses for all short positions of a security for the income statement ledger account range (3001000000 through 5999999999).

If you plan to use adjusted NAV expenses that adjust the variable expense's dollar based NAV component:

1. Set up an adjusted NAV expense rule where the Adjusted NAV Expense Rule Type is set to NAV.
   The rule excludes various components of fund activity. For more information, see Create a NAV Based Adjusted NAV Expense Rule.

2. Assign the rule to a variable expense or assign the rule to a group variable expense with a NAV Component of Prior Day Total Net Assets, Adjusted Net Assets, or Average Net Assets.
   You can assign the rule to a variable expense defined at the TF share class level that has a dollar based NAV Component of Prior Day Total Net Assets, Adjusted Net Assets, Average Net Assets.

3. Process the expense accruals.

For an example how the system uses the variable expense's tier rule and adjusted NAV expense rule to calculate the variable expense, see NAV Based Expense Rule Calculation Example.