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What is the difference between canceling a PO and releasing the encumbrance?

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What is the difference between canceling a PO and releasing the encumbrance?

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A PO is canceled when goods/services were not received (i.e.. the order was canceled or it is a duplicate PO). Encumbrances are released when the goods/services have been received, but the vendor did not invoice for the total amount on the PO. Sometimes departments have to estimate the dollar amount and end up with money left over. This is when we release the encumbrance. To get encumbrances released, e-mail Rose Coca with the PO number, Vendor name, amount to be released and the account number.

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