Outstanding Checks

What are Outstanding Checks?

Outstanding checks are a result of a time delay between a business writing out a check to pay a supplier, and the check being cleared through the bank account of the business.

The reason for this delay is the time it takes the check to get to the supplier, the supplier to send the check to its bank, the suppliers bank to process and send the check to the bank of the business, and finally for the check to clear the account of the business.

While these checks are in the system they are referred to by the business as outstanding checks. As the outstanding checks have been posted into the cash book but have not yet cleared the bank statement, they form a key component of any bank reconciliation procedure.

It is important for the business to keep track of outstanding checks using the bank reconciliation, as sufficient funds must be maintained in the bank account to cover the outstanding checks as and when they are presented for payment.

For further information see the Wikipedia definition.

Learn a new bookkeeping term

Random bookkeeping terms for you to discover.

Link to this page

Click in the box to copy and paste this outstanding checks definition link to your site.

Return to the Glossary

Outstanding Checks March 23rd, 2016Team

You May Also Like

Related pages

accounts receivable and allowance for doubtful accountsfuture value of annuity in excelbookkeeping spreadsheet excelfv formula excelamortization table calculationstockholders equity calculationdiscount allowed journal entryjournal entry for accrualsfob destination accountingstable monetary unit assumptionamortization table accountingwhat is zero based budgeting definitionretained profit formulaa company that receives an interest bearing note receivable willsimple petty cash book in excelvalue of perpetual bondbank loan accounting entriesexample of stockholders equityaccounting entries for salesexamples of production overheadswhen are closing entries madewhat is unearned revenuewhat are debtors on a balance sheetcredit card expense journal entryexcel calculate interest ratecash float sheetlease calculator excelwhat is the meaning of contra entrybookkeeping examformula for fixed cost per unitretaining earnings formulamultiplier chartsum of years digits depreciation formulacomparative income statement formatexample of a cashbookfinancial ratio calculator excelpayback calculation formuladouble entry for provision for bad debtsbookkeeping trial balanceprofitability index formulagross fixed assets formulacalculate reorder pointtimesheet template pdfexcel debt calculatorroa ratiomarkup ratiooverhead absorption rate calculationstockholder equity formulapv of lease paymentsmark up to marginhow to compute contribution margin ratiopresent value of anuityaccruals and prepayments journal entriescogs definition accountingsimple bookkeeping template for excelsteps in accounting cyclecash book ledger formatdiminishing value depreciation formulainvestment turnover ratio interpretationrequisition form templatewhat is cash float in accountingleverage ratio formula accountingjournalizing entriespetty cash liquidationformula for calculating debt equity ratioformula for nominal interest ratewhen is the balance in a prepaid expense account reducedaccounting for fixed assets gaapsmall business balance sheet template excelhow to calculate wip inventoryaccrual entries in accounts payablevertical analysis and horizontal analysisdifferentiate between trade discount and cash discountaccounting equation pdfcalculate markup formula