Your orders can be in the following states:
Not confimed/Shopping cart
Order that the customer still has to confirm, or that is still in the shopping cart.
Order is confirmed when the customer enters his invoice information, the shipping address (if needed) and the payment mode
You can manage all the orders confirmed by the customer, you can choose to wait for a payment confirmation or to immediately proceed with shipment. When an order is taken under management, the customer will not be able to modify it anymore.
An order becomes executed when you decide that it's been processed and (if needed) shipped.
An order is completed and then closed when you have payment (and delivery if needed) confirmed and registered.
An order can be canceled by the customer until it's taken under management by administration.
Order is open until you complete it, registering also the payment.