Outlier correction with the median method, tolerance lane

[Former Member]

Hello,

I was reading the SAP documentation regarding the Outlier correction with the median method and this question came in my mind. There was a formula for expected value:

and there was also a formula for the tolerance lane: Sigma * Expected value. So does this mean that

1. if a historical value is outside the range: ex-post forecast ± Sigma * Expected value, where ex-post forecast is the Expected value because ex-post forecast is calculated with median method, then it corrects the value

or does it mean that

2. if a historical value is outside the range: historical value ± Sigma * Expected value then it corrects the value?

or is it something else?