Establishing Commitment Control

The PeopleSoft commitment control feature enables you to check expenditures against a predefined budget. In PeopleSoft Cost Management, these expenditures typically occur when you expense inventory material to the department or to an expense account. Commitment control considers actual expenditures and imminent future obligations (encumbrances and pre-encumbrances). To use commitment control, select the commitment control option at both the installation options level and ledger group (product) level. Set up ChartField combinations as budgetary accounts for commitment control. There is a predefined source transaction definition, CM_TRNXTN, for PeopleSoft Cost Management. For further information on setting up PeopleSoft Cost Management to use commitment control, see the PeopleSoft Commitment Control.

See PeopleSoft Commitment Control Business Processes.

If you select the commitment control option, then the Accounting Line Creation process page includes the check box for running the Commitment Control (Budget Checking) process (FSPKBDP3) against accounting lines prior to posting them to the general ledger. Any transaction using a ChartField combination setup as a budgetary account for commitment control will be processed through the Budget Checking process.

Commitment control can be used in PeopleSoft Cost Management by:

• A requisition or purchase order is entered in PeopleSoft Purchasing using commitment control and a pre-encumbrance or encumbrance is established. If the purchase order is sourced from PeopleSoft Inventory, then the encumbrance is relieved and replaced with a expenditure against the budget when the Accounting Line Creation process is run with the Budget Check Accounting Lines check box selected to run the Commitment Control Budget Processor.

• A material stock request is created and stock is issued from PeopleSoft Inventory using a ChartField combination set up as a budgetary account for commitment control. The deduction to the budget occurs when you run Accounting Line Creation, no pre-encumbrance or encumbrance is created or relieved.