Outstanding Check List
Content
To prevent problems, you should cash or deposit a check promptly after receiving it. Balancing your checkbook is akin to what professional accountants do during reconciliation. It’s a way of making sure that you and your bank agree about your account balance and available funds. It can be tricky to balance a checkbook and we have a worksheet with step-by-step instructions to help you. The Outstanding Checks report lists any outstanding checks that have
not cleared the bank.
If a check remains outstanding for an extended period, it may become stale-dated, and the bank may refuse to honor it. The payee should contact the issuer to request a new check if this occurs. Huntington explains how you can add a person to your account at any time or open a joint bank account together. Unclaimed Property is all un-cashed checks, deposits, bonds, and physical property held by the City where the City has not been able to locate the original owner for three (3) years or more.
Risks of Outstanding Checks
Items more than three (3) years old as of March 1st are moved to the City’s unclaimed property account by July 1st of each year. Outstanding checks and unclaimed property held by the City can be found below. To view property held by the State of Texas, visit the Office of the Texas Comptroller website. This non-editable field displays the total amount of outstanding checks,
expressed in terms of the functional currency. Usually, you will print this report as part of your bank reconciliation before you begin clearing checks. When you receive a check and do not cash it right away, the check is outstanding.
When the payee cashes the check, and their bank tries to pull funds from the payor’s account, the payor will get hit with an overdraft or non-sufficient funds (NSF) fee. The payor can void these fees using overdraft protection on their checking account. A credit memorandum attached to the Vector Management Group’s bank statement describes the bank’s collection of a $1,500 note receivable along with $90 in interest.
How to Write Off Outstanding Checks
Once the check has been deposited or cashed by your vendor, your bank will debit your account and mark it as a cleared check on your next statement. You are entirely dependent on when the vendor decides to cash the check. Bouncing an outstanding check can lead to financial consequences, such as fees imposed by the bank, damage to your credit rating, and potential legal actions from the payee. Be mindful https://investrecords.com/the-importance-of-accurate-bookkeeping-for-law-firms-a-comprehensive-guide/ of what outstanding checks you’ve written before drawing down your bank balance. With banking activity becoming increasingly electronic, another way to avoid writing a check and forgetting about it is to use the checking account’s online bill pay service. This should provide real-time information about the total dollar amount of checks outstanding and the total dollar balance present in the account.
These deposits are called deposits in transit and cause the bank statement balance to understate the company’s actual cash balance. Since deposits in transit have already been recorded in the company’s books as cash receipts, they must be added to the bank statement balance. The Vector Management A Deep Dive into Law Firm Bookkeeping Group made a $3,000 deposit on the afternoon of April 30 that does not appear on the statement, so this deposit in transit is added to the bank statement balance. The ending balance on a bank statement almost never agrees with the balance in a company’s corresponding general ledger account.
Open a Huntington Checking Account
Call or email payees who fail to deposit checks and ensure that the check was, in fact, received. If they have the check, try to persuade them to deposit the check. If that doesn’t work, send a letter informing payees the check has not been presented and officially request they notify you if they have not received the payment. If you write a check and the money never leaves your account, you may develop the false belief you can spend those funds, but the money still belongs to the payee. If the payee finally deposits the check after months of delay, you risk overdrawing your account and bouncing the check.
The payee’s bank will request money from your bank, and the transaction concludes when your bank sends funds to the payee’s bank. Alternatively, if you both use the same bank or credit union, the transaction will conclude when the money is transferred from your account into the payee’s account. When you write a check to vendor, the bank has no idea the check has been written.