Which statement best describes an Unliquidated Obligation (ULO)?

• A. transactions where obligation > liquidation and dormant after 90-179+ days
• B. liquidation > obligation
• C. travel orders that have been liquidated
• D. obligations automatically canceled after 60 days

Answer: (A)

Unliquidated obligations are commitments that have been recorded but not yet paid in full. They exist when the amount originally obligated remains higher than the amount that has actually been liquidated, leaving an outstanding balance. In many systems, these lingering commitments are flagged as dormant after a lengthy idle period—typically around 90 to 180 days—prompting review or action before funds are canceled or adjusted. This combination—obligation greater than liquidation and dormancy after a long idle period—best describes an unliquidated obligation.

Over-liquidation would mean disbursement exceeds the obligation, which isn’t an ULO. Travel orders that have been liquidated are already settled, not unliquidated. Automatic cancellation after a set period describes a different policy and doesn’t define an active ULO.