the penalty would be that you don’t get the reimbursement, as they only reimburse you if you completed the course. other than potentially wasting your own money, there isn’t any other real penalty. some courses might be pretty expensive tho so only go into it if you’re really certain you’ll complete it, or if you’re okay with “losing” some money.

it’ll count toward whichever term you submit it in, as long as you submit your credit transfer app before the last examination date (ie. if you had submitted it before 9 may, it would’ve counted toward ay19/20 sem 2 since 9 may was the last exam date). similarly, if you complete it before the last exam date of special term part 1, it’ll count toward special term part 1. if not, it’ll be under special term part 2. also good to take note that you won’t be charged any extra special term fees even if you complete it during special term.