Depending on the projection you use to define a custom coordinate system, you must provide certain information. For example, if you use the Transverse Mercator projection, you must specify a longitude value called the central meridian.
When defining a custom coordinate system, you may want to enter a false origin, with northing and easting values. For example, if you are using the Transverse Mercator projection, and the central meridian bisects the mapping region, half of the X coordinates are negative values. Coordinate system definitions usually include an offset called the false origin that is added to all coordinates to make them positive. The X coordinate of this offset is called the false origin easting. The Y coordinate of this offset is called the false origin northing.
To produce the smallest possible distance between the projection surface and any point in the region you are mapping, you must specify a scale reduction factor. This is particularly important when you are mapping large regions. For the Transverse Mercator projection, you enter this value in the Scale Reduction Factor At The Central Meridian edit box.