Editing Encumbrance (section)

==Other uses==

===Colleges===
It is also a term used by [[college]]s and universities to describe limitations placed on a [[student]]'s account due to late payment, late registration, or other reasons stated by the institution. An encumbrance can prohibit students from registering for [[Class (education)|classes]], affect the release of their transcripts, or delay the reception of their [[diploma]]s.

===Accounting===
In [[management accounting]], ''encumbrance'' is a management tool used to reflect commitments in the accounting system and attempt to prevent overspending. Encumbrances allow organizations to recognize future commitments of resources prior to an actual [[expenditure]].  The term is frequently used in [[fund accounting]], especially among governmental entities.

;Pre-encumbrance: Amount expected to spend, but for which there is no legal obligation to spend. A requisition is a typical pre-encumbrance transaction.
;Encumbrance: Amount for which there is a legal obligation to spend in the future. A purchase order is a typical encumbrance transaction.  At this point, the amount of the encumbrance will be entered in the financial records.
;Expenditure: Amount for which there has been an expenditure of funds. An expenditure is recorded in Commitment Control for both vouchers payable and journal entries.  The encumbrance will be removed from the records when the expenditure is recorded.

=== Intellectual property ===
An example of [[Intellectual property#Criticisms|Intellectual property]] encumbrance is "encumbered code", software that cannot be freely distributed due to intellectual property rights.

=== Real Estate ===
In certain parts of the world, such as India, an Encumbrance Certificate is issued prior to the sale of a home in order to ascertain whether the title of the home is free and clear.