If you are using commitment control, you can specify partial or final liquidation of a requisition when it is sourced to a purchase order. When you create or modify a purchase order, you can designate that the purchase order is final, prompting the system to liquidate the preceding requisition. You can make your purchase order the final document to be affected by the preceding requisition, for less money than you originally authorized. You can also reverse the finalization of the document.
Here is a high-level overview of the procurement life cycle in commitment control:
- When you generate a requisition, a pre-encumbrance is created in your budget records by the budget-checking process
- When a requisition is sourced to a purchase order, commitment control liquidates the pre-encumbrance from the requisition and establishes an encumbrance for the purchase order
- When the purchased goods or services are delivered and the purchase order references a voucher, commitment control liquidates the encumbrance and records an expenditure
Partial Encumbrances
If you are using commitment control, you can specify partial or final liquidation of a requisition when it is sourced to a purchase order. When you create or modify a purchase order, you can designate that the purchase order is final, prompting the system to liquidate the preceding requisition. You can make your purchase order the final document to be affected by the preceding requisition, for less money than you originally authorized. You can also reverse the finalization of the document.
Example:
Question: The spending authority for the whole contract is say two million dollars, but I only want to encumber a portion ($500k for example?).
How do I do that?
Answer: This would be done by generating a purchase order, from the Requisition, for the $500K portion against the $2M contract. The purchase order would need to be approved and budget checked – at which point the funds are encumbered. The contract itself does not create an encumbrance.