The worlds run with The Imperial System will invariably be populated with people beyond the players, and creatures other than humans. This part of the system covers how we handle non-player characters of all types.
Everything in TIS will be capable of challenging your players, although the aim should be to do so without making it impossible for them to achieve their goals. As such, when the players roll to do something, the roll is never against the creature, but against the situation. That's why the rolls work the way they do - it's designed to allow the players freedom to act pretty much however they'd like, and if they fail it's due to the world getting in the way, rather than a fundamental inability on the part of their character.
NPC physical manipulations, professions and so on are left to the GM to decide, based on what makes sense for the NPC. However, suggestions are given in the bestiary for each of the types of creature the players might encounter. For the player peoples, anything is possible.
This gives the suggested total HP of the creature's armour and personal hit points. The specific value is given by the type of creature and the people/species it belongs to.
Some creatures have natural armour, due to thick hide, scales or just being incredibly tough. Others may wear actual armour like the players themselves, which can be similar or thicker/thinner, depending on the creature.
Armour stats give their total resistance to weapons, and are detailed in the usual Blunt/Slashing/Piercing format.
NPCs may well be armed. Their weapons work the same way as player weapons. Note their size, level and ranges. Attacks are always melee unless stated as Ranged.
Professions & Items
These, like the detail for Physical Manipulation, are left up to the GM to decide on the fly. For example, if the players encounter a noble, you might decide as you describe him that she wears a golden torc on her left arm, which denotes status. Equally you might decide that she's particularly skilled in negotiation, and therefore give her a bump in roll targets for any negotiation-related Diplomacy checks. Make a note of these things as they come up, but don't sweat them too much.
In any adventure run with TIS (or any other RPG system), encounters should have three parts: a link to the campaign's past, to give it relevance, a foreshadowing of the future, to drive the story forward, and a simple (although not necessarily initially clear) objective. Regarding the last, the party can either succeed, partially succeed, or fail, and so you need to be able to deal with any of those. It's entirely possible that your incredible bad-ass villain is going to be taken down by a low-level party, because they came up with something incredibly clever that you just didn't consider. Don't deny them that victory. Equally, it's possible that your clear, simple objective is actually something that they just don't see, or totally subvert in some way. You need to be ready to improvise when that happens too.
So the first thing for encounters is to ground them, set an objective, and have some ideas as to what to do if things go sideways.
Setting an Encounter
When creating an encounter, firstly write down the objective in its simplest form. Things like "bring the two sides to peace", "sneak in and retrieve the item", "kill the monster" or "stop the illegal activity" all work well. There's a clear, simple aim to be achieved, and obvious conditions for success, partial success and failure.
As for pitching the difficulty, because TIS has no concept of an overall level, instead watch how the party are doing, and set it as something appropriately challenging given how they're dealing with what they're facing.
Due to the party always rolling, and the Skills system, it’s quite possible something that would be very difficult for one group will be simple for another, because a party member will have spent time gaining skills in something that makes the challenge a breeze. For example, if the task is "track down the Grazelle*", often a party will be making Knowledge and Diplomacy checks, having to talk to people who may have seen it as it travelled and so on. However, if one of the party spent time with the Grazelle as a child, and has long ties to them as an adult, then they could have a Profession of anthropology, related to Grazelle culture and habits. This would make the task far easier for that party.
Rewarding the Players
A challenging objective should always result in the story moving forward, but also in delivering growth to the characters in the story. These can come in the forms of notes about things they know about or have a particular affinity for, or loot items, such as weapons, armour, money, trinkets or possessions.
They might also gain status or favours, depending on if they’re performing a task for others, who are in a position to reward them with such.
* Not something that appears in the game - I just made that up. However, feel free to use the name and invent the Grazelle if you’d like