Encumbrance Management enables funds to be reserved from a budget when a purchase order is created. The creation of encumbrances reduces the risk of overspending and ensures that funds will be available when payments become due. This module is often used by non-profit organizations as a part of their budget and fund accounting.
Encumbrances and PO Commitments are very similar in form and function, but there are differences in how Dynamics GP handles them. The basic differences are: