In the flow of funds, which step comes immediately after Allotment?

• A. Commitment
• B. Obligation
• C. Outlay
• D. Apportionment

Answer: (A)

In the flow of funds, the sequence moves from distributing the budget to reserving funds for specific uses, then to incurring legal liabilities and finally paying them. After funds are allotted to an organization, the next action is to commit those funds. A commitment reserves a portion of the allotted funds for a defined purpose, creating an internal liability and signaling the intent to spend. This sets up the balance for the actual financial events that follow: an obligation (legal liability when a contract is awarded) and then the outlay (the actual cash payment). So, committing funds is the immediate next step after allotment.