It depends on the contract, but generally, if the author worked in "Good Faith" (did the work legitimately) and the project was cancelled due to the client's strategic shift, the advance is usually non-refundable.
The advance pays for the time already spent.
If I hire a carpenter to build a table, and halfway through I say "Stop, I want a chair instead," I still have to pay for the half-table he built.
It depends on the contract, but generally, if the author worked in "Good Faith" (did the work legitimately) and the project was cancelled due to the client's strategic shift, the advance is usually non-refundable. The advance pays for the time already spent. If I hire a carpenter to build a table, and halfway through I say "Stop, I want a chair instead," I still have to pay for the half-table he built.