To implement the use of encumbrance:

• Options > Purchase Order > General. “Use Encumbrance” (optional setting). If box is checked, the encumbrance column on G/L account file will be updated when a PO is posted. When this box is checked for the first time, contact SGA to run a one-time script to update the encumbered amount for any accounts with existing/open PO’s.
• Financial Statements: Encumbered column indicates the total amount of open PO’s for this G/L account#.
• Detail Report Writer > Open Ledger by Account#: the listing of open PO’s for each G/L account# should equal the encumbered amount.
• Calculation of budget remaining if using encumbrance:
  • Setup > Options > Accounts Payable > Entry. “Show annual budget remaining for budget type” is the setting for the system to calculate budget remaining based on either original Budget or Forecast.
  • If high-level Options is set to use encumbrance, when the system calculates the budget/forecast remaining for a G/L account number entered, the encumbered amount will be considered. Annual budget (or forecast) minus year-to-date actuals minus encumbered amount minus the screen entry amount equals budget (or forecast) remaining.