You approved the budget. The numbers looked right. And then, somewhere between the purchase order and the invoice, you ran out of money.
If that scenario sounds familiar, the problem probably isn’t your budget. It’s what your budget doesn’t know about yet.
The Gap Between Budget and Reality
Most financial reports show you two things: what you budgeted and what you’ve spent. That seems like enough until you factor in everything that’s been ordered but not yet invoiced. Purchase orders that have been issued. Contracts that are active. Goods that are in transit.
None of those show up as expenses until an invoice is posted. But the money is already spoken for.
That gap between what you’ve spent and what you’re committed to spending is where budget surprises live. And for organizations managing tight margins, grant restrictions, or project-level budgets, that gap can be the difference between finishing a period in control and finishing it over budget.
What Commitments Actually Are
In Sage Intacct, commitments represent obligations you’ve made that haven’t yet hit your financials as expenses. The most common source is purchasing activity: an approved purchase order is a commitment. You’ve told a vendor you’re buying something. The budget impact is real even though the invoice hasn’t arrived.
When you track commitments alongside your actuals, your budget picture changes. Instead of seeing budget versus what’s been spent, you see budget versus what’s been spent plus what’s already obligated. That’s a much more honest number.
How Sage Intacct Handles This
Sage Intacct tracks purchase commitments through a feature called user-defined books. Rather than recording everything in your main accrual book, you set up a separate book specifically for commitments that holds obligations you’ve made without impacting your actual financials yet.
When a purchase order is approved, the committed amount posts to your commitments book. When the vendor invoice comes in and posts as an actual expense, the commitment is reversed so there’s no duplication. With commitments captured this way, your existing budget reports can now reflect what you’ve budgeted, what you’ve actually spent, and what you’re committed to spending. That committed spending view is what most organizations are missing, and it’s usually the one that explains why the numbers don’t add up at period end.
What Gets in the Way
Commitment tracking only works if your purchasing process runs through Sage Intacct. If purchase orders are being created outside the system, approved via email, or tracked in a spreadsheet, that activity is invisible to your budget reporting.
This is one of the most common issues we see during system reviews. The purchasing module is configured, but adoption is inconsistent. Some departments use it, others don’t. The result is budget reporting that looks complete but is missing a significant portion of actual obligations.
Getting full value from commitment tracking usually comes down to process as much as configuration. When the purchasing workflow runs through Sage Intacct consistently, the reporting takes care of itself.
A More Honest Budget Report
The goal isn’t to make your budget look smaller. It’s to make your budget reporting tell the truth. When you can see actuals and commitments together in a single view, you’re making decisions based on what’s really available rather than what appears to be available.
For CFOs and controllers, that’s the difference between proactive budget management and reactive damage control. For operations leaders and project managers, it means fewer surprises when the invoices start coming in.
Sage Intacct gives you the tools to get there. The question is whether your current process is taking advantage of them.
At LBMC Technology Solutions, we help Sage Intacct clients get more out of the modules they already have. If your budget reporting doesn’t reflect the full picture, we can help you figure out why and what it would take to fix it. Reach out to our team to start the conversation.
