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Hello
Ina situation where there outstanding cheques which cover a period of 5 to 6 years for different items such as payables, donations, loans from the entity, and many others,
I would like to know what should be done to correct it.I am a bit unsure since the period is for years before the current year and also there are so many other accounts besides the cash account (which form the double entry).
Thanks in advance.
Outstanding cheques are cheques that our business has written that have not been paid into the bank by the people we sent them to.
If they are old, then they will no longer be valid, and so the original entry that was made when the cheques were sent just need reversing.
However, I fail to see how this could possibly happen. If our payables had not banked the cheque that we sent to them then it would suggest that the cheque got lost in the post and they never received it – in which case they would have been pressing for payment.
This could not possibly be relevant for the Paper F3 exam.
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