Glossary

Committed cost

Committed cost is money the project has obligated through purchase orders, subcontracts, or other binding commitments, even if the invoice has not been paid yet.

Worked example

A hypothetical steel package awards a $1,200,000 subcontract. Until work is billed, that amount sits as committed cost against the cost code, not as spent cash.

Related terms

• Cost to complete
• Estimate at completion
• Billed vs complete percent

Keep reading: Why 77% of construction projects exceed budget.