Terraform: pass variable as a parameter in azure policy initiative - terraform

Question

I have a custom policy initiative I would like to assign using terraform, one of the policies does have parameters.
I know that for single policy assignment, we could use something like this, and pass variable as parameter.
parameters = jsonencode({
"operationName": {
"value": var.allowed_values,
}
})
however, I tried this with initiative, this doesn't seem to like it keeps complaining parameter is missing.
Infact, I tried to hardcode parameter into the body of azurerm_policy_assignment, I don't think even this is working.
resource "azurerm_policy_assignment" "example" {
name = "mcs_governance_policy_assignment"
scope = var.scopes
policy_definition_id = azurerm_policy_set_definition.iam.id
description = "example"
display_name = "Governance Policy"
metadata = <<METADATA
{
"category": "General"
}
METADATA
parameters = <<PARAMETERS
{
"operationName": {
"value": "Microsoft.Authorization/policyAssignments/write"
}
}
PARAMETERS
}
the policy initiative definition policy is as following, it uses built in policy, I have not included all the policies in this initiative, just for the one that complaining about the parameter
resource "azurerm_policy_set_definition" "iam" {
name = "mcs_iam"
policy_type = "Custom"
display_name = "MCS IAM Governance Policy Set"
description = "Contains MCS Governance policies"
metadata = <<METADATA
{
"category": "General"
}
METADATA
policy_definition_reference {
# An activity log alert should exist for specific Policy operations
policy_definition_id = "/providers/Microsoft.Authorization/policyDefinitions/c5447c04-a4d7-4ba8-a263-c9ee321a6858"
reference_id = "MCS IAM 3.1"
}

Answer 1

As I see, the azurerm_policy_set_definition iam only reference the policy definition, but it does not set the parameters in the policy_definition_reference block for the property parameter_values. You don't show how the policy definition configured, so you need to check how do the parameters setting in the policy definition and then add the parameter setting in the policy set definition.