The terms “soul” and “spirit” are often used interchangeably in modern English, and also to some extent in the Scriptures. They are synonymous, in the sense that they are not describing two separate realities. The human spirit is not some third part of the human person, separate from the soul. Rather, as an aspect of the soul, the human spirit (as distinct from the Holy Spirit), is that aspect of our soul that opens us to God. Some theologians speak of this openness of our spirit as giving us capax Dei (a capacity for God). That is to say, since our souls are spiritual and rational, we have the capacity to know and interact with God. And thus, the spirit is that aspect of our soul which most distinguishes us from the animals. 
 
In this distinction of soul and spirit, the Catechism says the following: Sometimes the soul is distinguished from the spirit: St. Paul for instance prays that God may sanctify his people "wholly" with "spirit and soul and body" kept sound and blameless at the Lord's coming (cf 1 Thess 5:23). The church teaches that this distinction does not introduce a duality into the soul. "Spirit" signifies that from creation man is ordered to a supernatural end, and that his soul can gratuitously be raised beyond all it deserves to communion with God. (Catechism #367).

Generally, the penance should be performed on Friday, though exceptions can be made due to other obligations such as attending family or civic celebrations. Strictly speaking, one can work out deferrals or dispensations in regard to Friday observances with their pastor, but practically, most simply work through this on their own. 
 
The thinking back in the 1970s when “meatless Fridays” were substituted with a day of penance was to offer other observances to people on Friday. Simply giving up meat and going to Red Lobster was hardly a penance for most, though the law was being observed technically. Hence it was thought to permit any range of penances, from giving up other things, to taking on special prayers or works of charity. 
 
But as your question implies, it is difficult to follow an uncertain trumpet, and many Catholics simply drifted from any Friday observance with such wide-open parameters. Psychologically it would seem that having a clear focus is necessary to assist in such practices. Hence, some Bishop’s conferences are going back to meatless Fridays. 
 
Here in America, that is not the case, though there has been some discussion. For now, you are largely free to determine how to observe Friday, presuming it has a penitential character. It could be to abstain from something good, or to take on some pious or charitable work.