What does encumbered mean in government?

encumbrances
An encumbrance is a restriction placed on the use of funds. The concept is most commonly used in governmental accounting, where encumbrances are used to ensure that there will be sufficient cash available to pay for specific obligations.

What does it mean when funds are encumbered?

Encumbered securities (or encumbered assets) are securities that are owned by one entity, but which are at the same time subject to a legal claim by another. A lien is a common example of a en encumbrance placed on a property that still has outstanding debts owed to creditors, such a an unpaid mortgage.

What is YTD encumbrance?

Encumbrances and Encumbered Budget: General Ledger calculates the year-to-date encumbrance balance as of the end of the year and carries forward that balance, plus an equivalent budget amount, into the beginning balance of the first period of the next fiscal year.

What does encumbered mean in a contract?

Encumbered means to reserve, set aside, or otherwise earmark the impact fees in order to pay for commitments, contractual obligations, or other liabilities incurred for public facilities.

How does a pre encumbrance request work in accounting?

A pre-encumbrance request asks management to set up an encumbrance. For example, the IT department wants to make a purchase of $30,000 in new computer equipment. It makes a pre-encumbrance request to approve the purchase. If management agrees, IT writes a purchase order, which creates the encumbrance. [ref4]

What does it mean to be in an encumbered position?

Encumbered jobs mean that there is someone who has taken a temporary re-assignment (most likely an overseas job) and has return rights to the job. If he comes back, you are most likely out of a job. But the activity is obligated to either (a) find him another job that he is qualiified for in that activity,…

What is the legal definition of an encumbrance?

Legal Definition of encumbrance : a claim (as a lien) against property specifically : an interest or right (as an easement or a lease) in real property that may diminish the value of the estate but does not prevent the conveyance of the estate that these premises are free from all encumbrances

When is an encumbrance created on the general ledger?

An Encumbrance is a type of transaction created on the General Ledger when a Purchase Order (PO), Travel Authorization (TA), or Pre-Encumbrance (PE) document is finalized. The encumbrance transaction shows an outstanding commitment by an organization.

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