# PercentOfAnnualized

When you create a `PercentOfAnnualized` action, you must specify a percentage. When setting up a benefit of this type, you must specify one or more based-on benefits. The calculations are done by applying the percentage to the annualized sum of the periodic values of the based-on benefits. The sum is annualized by dividing it by the phasing factor.

## Calculation formulas

The `PercentOfAnnualized` type uses this formula:

``Period that contains the action start date = Percentage x (Sum of periodic values of the based-on benefits for this period / Phasing factor for this period)``

This calculation type is not prorated to avoid double proration in the case that the based-on benefit is prorated.

## Example 1: PercentOfAnnualized calculation

This example shows how to calculate a `PercentOfAnnualized` action for a position with an even phasing method and the phasing factor of 1/12.

Starting on April 8, 2017, the action percentage is 10%.

This table shows the based-on benefits, Benefit A and Benefit B, and their values for periods from February through June:

Benefit type Feb Mar Apr May Jun
Benefit A \$1,000 \$1,000 \$1,000 \$1,000 \$1,000
Benefit B 0 \$1,000 \$2,000 \$3,000 \$4,000

This table shows the calculation result for this action:

Month Calculation Result
Apr 10% x ( (\$1,000 + \$2,000) / (1/12) ) \$3,600
Note: The action starts in April. Therefore, the resulting value for this action is calculated for April.