Assignments can have multiple Pass, Merit and Distinction criteria and must get all at each level to get any the next. So to get a Merit you need to get all Pass and all Merit etc. If you miss any Pass criteria you get a Refer.
You can have as many items as you like at each level and it allows you to have frequently used comments that can be dragged into each submissions grading sheet. Results will appear in the gradebook as Pass Merit and Distinction.