The role of accounting automation in handling Uncleared Checks

Although it is normal nowadays to ask non-retail customers to transfer money to your banking account, the practice of issuing a paper check is still in use. If you are an IT staffing company executive and you have a vast customer base, chances are that at least one-third of the customers are sending in a check instead of a direct bank deposit in your firm’s account.

Most accountants consider handling checks a daunting task. It entails work like recording the checks’ numbers, payers’ name and bank names, place of issue, reason for payment, check amount, void date, date on check and date on which to deposit. Sometimes there may be a few special requests too. Often checks are accompanied by a check dispatch advisor letter which may state that this is the final settlement of a series of payments for a particular project.

When a check is written with a particular date and instructed to be deposited on a future date, the accountant will usually store it for safekeeping and deposit it on the date as per instruction. Safekeeping is a reason why many checks are received and forgotten until and even beyond the void date. Over a period of time void checks accumulate but reflect as payments received. Though it can be detected during audit time, failure to realize payments on time will result in negative cash flow.

The best way to handle uncleared checks is by adding an accounting automating software like CONSULT that can be easily integrated with QuickBooks.

How to Automate Check Clearing?

Keeping track of checks that have not been cleared is a difficult job, especially if the accountant has not deposited the instrument at all. QuickBooks’ level of features do not allow IT staffing companies to keep track (reminder services) of checks that have not been cleared and payment realized in the account. Only a specialized invoicing and VMS enabled software like CONSULT (invoicing application add on for QuickBooks) can keep track of each check’s current status and forewarn the accountant to take the right steps to ensure that payments are realized at the earliest.

Handling checks needn’t be so exhausting when accountants integrate CONSULT; it doesn’t require them to go through a long list of checks to deposit or cross verify payment receipts against checks. It also works well for detecting and taking action to get paid against such checks on a timely basis.

How CONSULT Handles Un-cleared Checks

Once CONSULT is integrated with QuickBooks, every operational details pertaining to supplying consultants and conscripting subcontractors comes under the invoicing applications scanner – it ensures that timesheets are received on time and reconciled with the subcontractors and customers; payment is processed for consultants and subcontractors and payments are received from customers.

CONSULT is a rich-feature application and all check receipts are stored in it and you get an alert whenever there is delinquency in the check payment receiving process. IT staffing companies are taking advantage of the application to ensure that not a single payment is ever missed.

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