Encumbrances

Encumbrances within NetSuite for Government

An encumbrance is a set amount of money committed to a payment for good or services ahead of the actual purchase. When a requisition is placed, an encumbrance is automatically created per each line of the transaction. This commits the funds to be used for the specific purpose designated on the requisition. As items are received against a requisition, we disencumber the amount against the encumbrance balance. Items can be partially or fully received and directly impact the total encumbrance balance. A Budget to Actual report can be run to showcase the commits or encumbrances balance. Encumbrance information can also be shown on dashboard portlets.