Commitments, encumbrances, and budget edits

A commitment is a reservation of funds for requested products and services.

You can have commitments and budgets for any item in your code block. A commitment record can be created when a requisition has been entered and released, a purchase order has been entered and released, or a contract has been activated.

An encumbrance is an obligation of amounts to pay for products and services that were contracted for but not yet received.

Commitments and encumbrances create records during normal operating processes which can be used to perform budget edits. The posted transactions, commitments, and encumbrances are tracked and deducted from your budgeted funds. This results in an accurate remaining balance of your budgeted funds and helps prevent going over the budgeted amounts.

If you have commitments and budget edits set up, then these affect a requisition at the time it is created or released. For more information about commitments, encumbrances, and budgets see the Global Ledger User Guide.