Unobligated

Unobligated is an adjective describing funds, resources, or duties that have not yet been committed to a specific obligation or binding contract. In finance and budgeting, unobligated funds are those that have been appropriated but have not yet been encumbered or expended. The term helps distinguish money that is reserved for a known liability from money that remains available for future use.

In government budgeting, unobligated balances indicate residual authority to spend. Agencies track unobligated amounts to assess liquidity, plan purchases, or reallocate funding. When funds are obligated, a contract, grant, or order creates a binding commitment; until then the funds are unobligated.

End-of-year handling varies; some jurisdictions require lapse or reobligation. Unobligated balances may be carried forward, redirected, or rescinded under policy. The concept is distinct from unspent funds, which may be unexpended but still obligated or unencumbered, depending on rules.

Etymology and usage: unobligated combines un- with obligated. In procurement and accounting, the distinction between obligated and unobligated funds affects reporting, audit trails, and budget execution.