Procurement & finance
Committed Cost
Money legally promised but not yet invoiced — the value of approved purchase orders and subcontracts. It is the leg that budget-versus-actual leaves out, and it is the leg that warns you.
A project’s true position is budget against committed against actual. Track only actuals and you are reading a report about a decision made two months ago.
The reason this matters is timing, not accuracy. The overrun is already real at the moment the PO is approved. Committed-cost tracking is simply the difference between finding out then and finding out when the invoice lands.