Last updated on June 18th, 2021 at 04:06 pm
Although rescheduling financial interest payments is possible only by special arrangement, or in bankruptcy, we can often defer or advance MICs on technical debt by rescheduling work that might incur them. For some kinds of technical debt, MICs accumulate only if we perform engineering work that involves that debt. This property is especially useful when we plan to retire an asset that bears technical debt. When we remove the asset from service, the technical debt it carries vanishes.
For most conventional financial debts, interest charges accumulate until we retire the debt. Interest charges might be zero for some time periods, but they’re never negative. Failure to meet the contractual payment schedule can result in penalties and additional interest charges.
MICs are different from financial interest charges
For technical debt, we can sometimes defer or advance MICs without penalty. We can arrange to temporarily nullify the MICs on a particular class of technical debt, or particular instances of that class. To do so, we need only reschedule a project or projects. This is possible when MICs accrue only if there is a need to perform work on the assets that carry the debt. In a given fiscal period, if we perform no work on those assets, the MICs can be zero. By scheduling projects accordingly, we can arrange for MICs to be zero.
There is one caveat. As I mentioned in “Debt contagion: how technical debt can create more technical debt,” as long as a particular class of technical debt remains in place, its associated MPrin might increase. Deferring retirement of a class of technical debt can be wise only if we can control its associated MPrin or if changes in its MPrin are acceptable.