Essentially Step 1 lets you do the IR and LC in 1 frame and removes the need to render the LC & THEN the IR with every Nth frame blah blah.
Setting Up LC/IR
Render using LC/IR
Just be aware, anything animated must be hidden for this and rendered on a seperate pass. Either render the animated objects with bruteforce/light cache... OR
FYI (not required but handy to know). Another way to render your animated objects (again render them separately so the shadows dont mess up with the ir/lc) - is keep the irradiance map/light cache on in the render settings, & in the material for the animated object - select Options > Use Irradiance Map (uncheck). This will force that particular material to be rendered with brute force regardless. This can be a little bit more labour intensive which is why I suggest rendering it as a brute force/light cache - you could use VMC to speed up the process and select all your animated objects and apply this automatically to them, up to you.