Commitments
A Commitment is a recorded financial obligation within a project. It represents the transition from estimated cost to confirmed cost — a committed amount for materials, subcontractor work, equipment, or other procurements.
Commitment vs. Baseline vs. Actual
Section titled “Commitment vs. Baseline vs. Actual”| Concept | Meaning |
|---|---|
| Estimate | Predicted cost based on cost logic and market context |
| Baseline | Approved estimate that governs cost tracking |
| Commitment | Actual financial obligation entered into (purchase order, contract award) |
| Actual Cost | Final invoiced amount |
A commitment exists between the baseline (what was planned) and the actual cost (what was paid). It captures confirmed obligations before final invoices arrive.
Commitment Model
Section titled “Commitment Model”Each commitment includes:
- Commitment line items — individual cost entries with quantity, unit price, and total
- Status — lifecycle state reflecting the commitment’s progress
- Linked cost groups — association with project cost groups for variance tracking
- Source evidence — purchase orders, contracts, or subcontractor agreements
- Bid proposal ID — link to the winning proposal when created from a bid award
Status Lifecycle
Section titled “Status Lifecycle”Draft → Issued → PartiallyConsumed / Consumed → ClosedA commitment in any state can also transition to Cancelled (blocked if approved linked actuals exist). Consumed is auto-calculated: when all lines are fully consumed by linked actual costs.
Three-Layer Variance
Section titled “Three-Layer Variance”Commitments enable a three-layer variance analysis:
- Baseline → Commitment — procurement variance: did we buy at the planned price?
- Commitment → Actual — execution variance: did final costs match the commitment?
- Baseline → Actual — total project variance
Business Rules
Section titled “Business Rules”- Commitments can only be created against a project with an active baseline
- Issuing a commitment requires at least one line item
- Linking an actual cost from a different baseline to a commitment line is blocked
- A commitment line with linked actual costs cannot be removed
- Cancellation is rejected when approved linked actual costs exist
Workflow Role
Section titled “Workflow Role”- An approved baseline defines planned costs by cost group
- As procurement happens, commitments are recorded against those cost groups
- Bid awards automatically create draft commitments linked to the winning proposal
- When invoices arrive, actual costs replace or refine commitment amounts
- Variance reporting compares actuals against both commitments and baseline