Commitment processing is a future feature for the General Ledger system. The commitment subsystem is used to track significant orders that will not appear as expenses through the normal channels, e.g. Account Payable, for a prolonged period. This situation often occurs when ordering large custom-made equipment. The delivery can take months, however the commitment to pay for the expense was made when the order was placed. These outstanding cost items must be factored into management planning long before the expense is recorded for accounting purposes.
The commitments are recorded in a separate unit of the database in much the same way that detail accounting transactions are recorded. A commitment is viewed as a document representing one or a series of related commitments. A series could be a purchase that involves progress payments. Each item of the commitment can be assigned to a particular G/L Account for the year and period in which it is expected to occur.
For reporting purposes a commitment is ignored if it is in a period preceding the reporting period or if it has been marked as fulfilled. If the effective date of the commitment is after the end of the reporting period it is also not shown. In the case of full-year reports only commitments after the year-end will be shown. On a detail report the commitments are shown in a separate group following the posted and unposted transactions.