An Adjustment in AR is an amount added or subtracted from the amount due of an Invoice, Debit Memo, Chargeback, Deposit, or Guarantee.
Oracle AR lets you create Automatic or Manual Adjustments.
Receivables lets you make either Positive or Negative Adjustments to your Invoices, Debit Memos, Chargebacks, On–account Credits, Deposits, and Guarantees.
You can approve Adjustments that are within your approval limits and give pending statuses to Adjustments that are outside your approval limits.
You can also automatically write off debit items that meet your selection criteria.
Business need for Adjustment
Its very similar to write-off. If there is any unapplied balance in invoice after application of receipt in small value for rounding off purpose , that will be adjusted while making receipt application.
Or sometime, when Invoice amount is wrongly entered you can also add a line by adding or reducing amount.
These are very common across all industry.Telecom, Health care and retail sectors the need is very high for such functionality.