"Apply penalties and bonuses in the most beneficial order"
This little innocuous statement has me baffled. I've seen it repeated over and over on these boards and others like them. It's been used for philosophical rules games and cheese factory character building alike.
...But where is this rule?
I've searched every copy of every book I own for this statement, even back into my 3.5 and 3.0 books. I've even looked online and I mostly find people using this "rule" for some build or such, posting it as gospel yet citing no source.
The closest things I've found that remotely look like a source are a Sage ruleing about poison and death attacks that I believe to have been written by Skip Williams and a question about the Practiced Spellcaster feat in the 3.5 FAQ (last updated 2008).
Where did this little gem come from? Why does it seem everyone knows it? Does it exist anywhere in pathfinder?
Inquiring minds (mostly mine) want to know!
Well, thanks to stacking rules, it doesn't really apply to bonuses and penalties: the place you'll see it crop up most is with energy resistance.
A creature with Fire Resistance 20 is hit with a fireball for (lucky roll!) 50 points of damage.
We're all going to agree that if it fails the Reflex save it takes 30 points of damage.
How much does it take on a successful save?
At this point, the order of the alterations matter.
If it's resistance, then save, it will take 15 points of damage.
If it's save, then resistance, it will take 5.
Accepted wisdom is that effects like this are treated to the defender's advantage, but I don't think it's covered anywhere in the rules as such, it's just how it works: a creature that saves is taking 25 points of damage, not "50, but modified". Since that's the case, the more general case to the rule becomes "apply effects to defender's advantage", which is where I've even seen Paizo staff say the same thing.