What does 'executed obligations' refer to?

• A. Pre-commitments with no liability
• B. Future commitments that have not yet recorded liability
• C. Obligations that have been validly recorded; goods/services with a liability
• D. Budgets that are under-spent

Answer: (C)

Executed obligations are those that have moved beyond planning and have become a real financial responsibility: goods or services have been received (or accepted) and a liability is recorded, typically in accounts payable. This means the organization has officially recognized the obligation in its books and owes payment to a supplier. That is exactly why the best description is that obligations have been validly recorded and carry a liability for the organization.

Why the other ideas don’t fit: pre-commitments with no liability are encumbrances or commitments not yet converted into an actual debt. Future commitments not yet recorded liability have not created a payable. Budgets that are under-spent speak to remaining funds, not to the existence of an already incurred and recorded obligation.