Cheques and cheque registers

A Cheque Transaction is xMatix's record of one paper cheque, either one you write to a supplier or one a customer hands you, and a Cheque Register is a cheque book that hands out cheque numbers in sequence. You don't usually create cheque transactions yourself: saving a payment with the mode Cheque creates one. Later, when the bank pays or returns the cheque, you set the cheque's Status to Cleared or Bounced, and xMatix moves the money in the ledger to match.

Overview

A cheque payment does not reach the bank on the day you record it. xMatix therefore posts the money side of a cheque payment to the company's Cheques In Hand GL account, not to the bank. The cheque transaction tracks the cheque until the bank settles it:

• Cleared posts a clearing journal that moves the amount between Cheques In Hand and the bank.
• Bounced reverses the payment's journal, so the invoice or bill it settled is open again.
• Issued, Presented and Cancelled only record where the cheque is. They post nothing.

Both records are in the Banking area:

• Cheque Transactions — the list of cheques. The record page has a Details tab with three sections: Cheque Information (Name, Cheque Number, Cheque Date, Cleared Date, Amount, Direction, Status, Owner), Linked Records (Bank Account, Cheque Register, Party Account, Partner Account) and Source Information (Source Entity Name, Source Record). A panel of cards beside it shows the amount, status, direction, cheque date and cleared date.
• Cheque Registers — the cheque books. The record page has a Cheque Transactions tab listing the cheques drawn from that book, and a Details tab with Register Information (Name, Prefix, Label, Status, Is Active, Owner), Number Range (Start Number, End Number, Next Number) and Linked Records (Bank Account, Partner Account). A Register Insights panel beside it shows the start, end and next numbers, the status and the bank account, above an attachments panel.

A bank account's record page also has a Cheque Register tab (see Bank accounts).

When to use it

• You pay suppliers by cheque and want xMatix to number the cheques from your cheque book.
• You collect cheques from customers and need to see which ones are still waiting to be paid by the bank.
• A cheque has cleared and the ledger should show the money in the bank.
• A cheque has bounced and the invoice or bill it paid should be open again.

You don't need a cheque register to take cheque payments. Every cheque payment saved on the web gets a cheque transaction, with or without a register. The register adds automatic numbering for cheques you write.

How xMatix handles it

• Payments create the cheques. When a new payment with mode Cheque is saved on the web and posts, xMatix creates one cheque transaction for it, linked back to the payment. A payment that doesn't post (its company has GL posting turned off) gets no cheque, and a payment never gets a second one. Payments saved in the mobile app do not create a cheque transaction.
• Direction follows the payment. A Payment Given (and a refund you pay to a customer) creates a cheque with Direction Issued. A Payment Taken (and a refund a supplier pays you) creates one with Direction Received.
• Every new cheque starts as Issued. Status starts at Issued for both directions. On a received cheque, Issued simply means the cheque has not cleared yet.
• Numbers come from the register only when you leave them blank. For a cheque you pay, if you leave Cheque number empty on the payment, xMatix takes the next number from an active cheque register of the payment's company, stamps it on the cheque, writes it back to the payment and moves the register's Next Number on. If you type a number, xMatix records it as typed and does not touch the register. Received cheques never use a register.
• Which register is used. xMatix looks for registers whose Partner Account is the payment's company, whose Status reads Active and whose Is Active is not cleared. If there are several, it uses the one with the lowest next number, so books are used up in order. When the next number passes the End Number, the register's Status changes to Exhausted and it is no longer used.
• A new cheque book has no Status until you give it one. A register saved from the New form with Status left empty keeps an empty Status, and a register with an empty Status is never used for numbering. The Status list ships with no values, so an administrator adds them first (see Configuration). An empty Is Active is fine: only a cleared one stops the book.
• No usable register, no number. If no register fits, a cheque you pay with an empty Cheque number is still recorded, but unnumbered: it is named "CHQ-" followed by a date and time, and the payment's Cheque number stays empty.
• Clearing posts one journal. Setting Status to Cleared posts a journal dated on the Cleared Date (today, if it is empty). For a received cheque it debits the bank and credits Cheques In Hand. For an issued cheque it credits the bank and debits Cheques In Hand. The journal is labelled "Cheque clearing" followed by the cheque number.
• Bouncing reverses the payment. Setting Status to Bounced reverses every posted journal of the payment the cheque came from. The settled invoice or bill opens again in the ledger and the ageing. The payment record keeps its Posted status.
• No Cheques In Hand account, no clearing journal. If the company has no GL account of type Cheques In Hand, the cheque payment posted straight to the bank, so clearing posts nothing.

Prerequisites

• GL Posting Enabled turned on for the company (on its account record). Cheques are created only when a payment posts.
• A chart of accounts for the company with a GL account of type Cheques In Hand and one of type Bank.
• For cheque numbering, an active bank account whose GL account is active, and a cheque register for it whose Status is Active. That needs the Cheque Register Status values added by an administrator (see Configuration).
• An open fiscal period for the date you clear a cheque on.
• Access to the Banking list (in the Finance app, or the Banking app) and edit access to Cheque Transaction (see Permissions).

Procedure

Step 1 — Add a cheque book

1. In the Finance app, open Banking, then Cheque Registers, and select New. You can also start from a bank account's Cheque Register tab.
2. Fill in Name (for example the book's serial), Bank Account, Partner Account (the company that writes the cheques), Start Number and End Number. Add a Prefix if your cheque numbers carry one.
3. Leave Next Number empty to start at the Start Number, or enter the next unused leaf if the book is already partly used.
4. Set Status to Active. If the list is empty, ask your administrator to add the Status values first: a book saved with an empty Status never hands out numbers.
5. Select Save.

To check an existing book, open it and read Status in the Register Insights panel. If it is empty, select the pencil next to Status on the Details tab, choose Active and save.

xMatix refuses the register if the start is greater than the end, if the range overlaps another register on the same bank account, or if the bank account or its GL account is inactive.

Step 2 — Record a cheque payment

Record the payment as usual (see Payments) and choose Cheque under How was it paid?. Then:

• For a cheque you pay, leave Cheque number empty to take the next number from the cheque book, or type the number of the leaf you used.
• For a cheque you receive, type the number printed on the customer's cheque.
• Enter the Cheque date. It can't be later than today. If you leave it empty, the payment date is used.

When you save, the cheque appears in Cheque Transactions with Status Issued.

Step 3 — Find a cheque

In the Finance app, open Banking, then Cheque Transactions. The standard view, All Cheque Transaction, shows Name, Cheque Number, Direction, Status, Amount, Cheque Date, Bank Account, Cheque Register, Party Account and Partner Account. Search or filter by Status to see the cheques that have not cleared yet. Select a cheque's name to open its record page.

To see the cheques drawn from one cheque book, open the register and select its Cheque Transactions tab.

Step 4 — Record that a cheque was presented (optional)

On the cheque's record page, select the pencil next to Status, choose Presented and save. This only records progress. Nothing is posted.

Step 5 — Clear a cheque

When the amount appears on your bank statement:

1. Open the cheque's record page.
2. Select the pencil next to Cleared Date and enter the date the bank settled the cheque.
3. Select the pencil next to Status, choose Cleared, and save.

xMatix posts the clearing journal in the same save. If posting fails, for example because the period is closed, nothing is saved and the cheque keeps its old status. Then match the clearing journal's bank line against the statement in the Bank Reconciliation workspace.

Step 6 — Record a bounced cheque

When the bank returns a cheque unpaid:

1. Open the cheque's record page.
2. Select the pencil next to Status, choose Bounced, and save.

xMatix reverses the payment's journal. Check the invoice or bill afterwards: it shows its balance as open again. When the customer pays again, record a new payment. Any charges the bank applies for the returned cheque are not recorded by xMatix. Post them yourself, for example with a journal.

Step 7 — Cancel a cheque

Set Status to Cancelled to record that a cheque was voided. Cancelling posts nothing and does not undo the payment. If the payment should no longer count because the cheque was never handed over, choose Bounced instead, which reverses the payment's journal.

Step 8 — Retire a cheque book

To stop a register being used for new cheques, open it, select the pencil next to Is Active, clear it and save. A register also stops being used on its own when its numbers run out and its Status becomes Exhausted.

Fields

Cheque Transaction

The fields as they appear on the record page.

Cheque Register

Business rules

• Cheque save checks. On every save, xMatix refuses an amount of zero or less, a cheque date later than today, a cheque number already used on the same bank account, and a number outside its register's range. A payment whose cheque fails these checks is not saved either.
• The duplicate check needs a bank account. Cheques with an empty Bank Account (received cheques and typed numbers) are not checked for duplicates.
• Register range check. The prefix is removed before the number is compared with Start and End. Numbers that aren't numeric are not range-checked.
• Register save checks. Start can't be greater than End, ranges on one bank account can't overlap, and the bank account and its GL account must be active.
• Posting happens on a status change. A journal is posted only when an existing cheque's Status changes to Cleared or Bounced. A cheque created by hand with Status already set to Cleared posts nothing.
• Clearing posts once. If a cheque already has a clearing journal, setting it to Cleared again posts nothing more.
• The clearing bank account. The clearing journal uses the company's Bank-type GL account, not the GL account of the cheque's Bank Account. If the company has several Bank-type GL accounts, check which one the journal used and move the amount with a journal if needed. The journal has no branch.
• Bounced reverses the payment only. The reversal leaves any clearing journal alone, and a cheque with no source payment reverses nothing.
• No lock after Cleared or Bounced. The record page lets you change Status again after Cleared or Bounced, and xMatix does not undo what it already posted. Treat both as final.
• Payment and cheque stay separate. Bouncing a cheque doesn't change the payment's status, and deleting a cheque transaction doesn't change the payment or its journals.

Example

A distributor pays a supplier 58,000.00 by cheque and receives a customer cheque of 42,500.00 in the same week. Its chart has a Cheques In Hand account and one Bank account, and its bank account "Current Account – Main" has a cheque register "Book 7" with Prefix MN, Start Number 300101 and End Number 300150.

1. On 6 October the accountant records a Payment Given of 58,000.00 to the supplier, mode Cheque, Cheque number left empty. The payment posts AP against Cheques In Hand. A cheque transaction MN300101 appears with Direction Issued, Status Issued, Bank Account "Current Account – Main" and Cheque Register "Book 7". Book 7's Next Number becomes 300102, and the payment's Cheque number shows 300101.
2. On 7 October they record a Payment Taken of 42,500.00 from a customer, mode Cheque, Cheque number 664210, applied to the customer's invoice. A cheque transaction 664210 appears with Direction Received and Status Issued.
3. On 9 October the customer's cheque is credited on the bank statement. The accountant opens 664210, sets Cleared Date to 9 October and Status to Cleared, and saves. A journal "Cheque clearing 664210" dated 9 October debits the bank and credits Cheques In Hand with 42,500.00.
4. On 12 October the bank returns the supplier's cheque. The accountant opens MN300101, sets Status to Bounced and saves. The payment's journal is reversed, and the supplier's bill shows 58,000.00 open again.
5. The accountant issues a new cheque by recording a new payment, which takes MN300102.

Training

Practice exercise

In a sandbox company with a Cheques In Hand and a Bank GL account, an active bank account and a cheque register for it (Start 1001, End 1002, Partner Account set to the company, Status left empty), and with the Cheque Register Status values added by an administrator:

1. Record a Payment Given of 100.00 by cheque with Cheque number empty. Expected result: an unnumbered cheque named "CHQ-" and a date and time; the register's Next Number is unchanged. Now set the register's Status to Active.
2. Record a Payment Given of 1,000.00 by cheque with Cheque number empty. Expected result: a cheque transaction named with the register's prefix and 1001, Status Issued; the register's Next Number is 1002.
3. Record a third one the same way. Expected result: number 1002, and the register's Status becomes Exhausted.
4. Record a Payment Taken of 500.00 by cheque with a typed number and a cheque date of tomorrow. Expected result: the save is refused with "Cheque date cannot be in the future." Change the date to today and save.
5. Set the received cheque's Status to Cleared. Expected result: a "Cheque clearing" journal debiting Bank and crediting Cheques In Hand with 500.00.
6. Set the cheque numbered 1001 to Bounced. Expected result: the first payment's journal is reversed; the payment still shows Posted.

Quick reference

• Menu: Finance → Banking → Cheque Transactions and Cheque Registers (or the Banking app).
• Cheque payments on the web create the cheque; you don't.
• Leave Cheque number empty on a payment to draw it from the cheque book.
• A cheque book draws numbers only while its Status reads Active — set it when you add the book.
• New cheques start as Issued, in both directions.
• Cleared: set Cleared Date first, then Status. Posts Cheques In Hand ↔ Bank.
• Bounced: reverses the payment; the invoice or bill opens again.
• Presented and Cancelled post nothing.
• Treat Cleared and Bounced as final.
• No post-dated cheques: the cheque date can't be later than today.

Permissions

Cheques and registers follow the normal entity permissions in security profiles:

There is no separate permission for clearing or bouncing: anyone who can edit a cheque can change its Status. If that matters, limit edit access to Cheque Transaction or use field permissions on Status.

Configuration

• Cheques In Hand account. Give each company that takes or writes cheques a GL account of type Cheques In Hand, as well as a Bank account. Without it, cheque payments post straight to the bank and clearing posts nothing. See Chart of accounts, books and periods and GL accounts.
• Only one Bank-type GL account per company, if you can. Clearing journals use the company's Bank-type GL account. With several, check where clearing journals land.
• Cheque registers. Create one per cheque book with the right Partner Account and Bank Account. See Step 1.
• Register Status values. The Cheque Register Status field has no list values shipped, so its dropdown is empty. Add the values Active, Exhausted and Cancelled in Setup → Design Studio → Entities → Cheque Register before anyone creates a cheque book. This is needed, not optional: a register saved from the New form with an empty Status is never used for numbering, and without the values nobody can set it to Active. Use exactly these words: numbering only uses registers whose Status reads Active, and xMatix writes Exhausted itself.
• Mode of payment. Cheques are created only for payments whose mode is Cheque. See Payments.
• Cheques console. The page designer includes a Cheques widget (per-account cards, a cheques tab and a cheque books tab). It is not on any standard page. Its Mark cleared button calls a server action, MarkCleared, that isn't set up as an action on Cheque Transaction in a standard installation. Until an administrator adds that action and grants it, use the Status field to clear cheques.
• Form layout. On the Cheque Transaction Edit form, Direction and Status are free-text boxes. Use the record page, where Status is a list. An administrator can change the form in Design Studio (see Design a form layout).

Common problems

"Cheque date cannot be in the future."

The cheque date, or the payment date when the cheque date is empty, is later than today. xMatix doesn't accept post-dated cheques. Record the payment on or after the date on the cheque.

"This cheque number has already been used for this bank account."

Another cheque on the same bank account already has this number. Check the cheque book's register for the leaf, or correct the number.

"Cheque number '…' is outside this cheque register's allowed range (…)."

The number doesn't fall between the register's Start Number and End Number. Correct the number, or the register's range.

"Cheque amount must be greater than zero." or "Amount cannot be 0 or Negative"

The cheque's amount is zero or negative. Enter the amount as a positive figure.

"Cheque register range is exhausted."

The register's Next Number is past its End Number but its Status still reads Active. Set its Status to Exhausted or clear Is Active, and add a new register for the next book.

"This cheque number range overlaps an existing register for the same bank account."

Another register on the same bank account already covers some of these numbers. Change Start or End so the ranges don't overlap.

"Start cheque number cannot be greater than the end cheque number."

Swap or correct the Start Number and End Number.

"The selected bank account is inactive; a cheque register cannot be created against it."

Choose an active bank account, or reactivate the account (see Bank accounts). The similar message about the bank account's GL account means its GL account is inactive.

A cheque payment didn't take a number from the cheque book

You see a cheque named "CHQ-" followed by a date and time, and the payment's Cheque number is empty. The most common cause is a register whose Status is empty: books saved from the New form without choosing a Status are never used. Open the register, set Status to Active and save (if the list is empty, your administrator adds the values first, see Configuration). Also check that the Cheque number was empty on the payment, that the register's Partner Account is the payment's company, and that Is Active isn't cleared. Received cheques never take a number.

Fixing the register doesn't number cheques already recorded: xMatix creates a payment's cheque only once. Only payments saved after the fix draw from the book.

My cheque payment has no cheque transaction

It was recorded in the mobile app, its mode isn't Cheque, or it was never posted: the payment has no company, or the company's account record has GL Posting Enabled turned off. Cheques are created only when a payment posts. Record cheques that need tracking through the web payment form, for a company with GL posting enabled.

I cleared a cheque but no journal was posted

The company has no Cheques In Hand GL account, so the payment already posted to the bank and there is nothing to clear. It also happens when the cheque has no Partner Account, or when it was created by hand with Status already Cleared.

"Fiscal period '…' is Closed — posting is not allowed."

The Cleared Date (or today, if it is empty) falls in a closed period. Use a date in an open period, or ask your administrator to reopen the period.

Common questions

Do I have to create a cheque transaction for each cheque?

No. Record the payment with mode Cheque on the web and xMatix creates the cheque transaction when the payment is saved. Creating cheques by hand is possible from the list's New button, but a hand-made cheque has no link to a payment, so bouncing it reverses nothing, and clearing it moves money between Cheques In Hand and Bank that no payment put there. Use payments.

Why does a cheque I received show Status Issued?

Every new cheque starts with Status Issued, whichever way the money goes. Direction tells you whether you wrote it or received it. For a received cheque, Issued means it is still waiting to clear. Move it to Presented when you deposit it if you want to track that step, and to Cleared when the bank credits it.

Can I record a post-dated cheque?

Not as a cheque payment. xMatix refuses a cheque date later than today, on the payment and on the cheque record. Keep post-dated cheques outside xMatix until their date, then record the payment on that day. The invoice stays open in the meantime, which matches the fact that you haven't been paid yet.

What happens to the invoice when a cheque bounces?

Setting the cheque to Bounced reverses the payment's journal, so the money the payment applied to the invoice or bill is taken back and the document shows the amount open again in the ledger and the ageing. The payment record itself still shows Posted. Take a new payment when the customer pays again.

Can I undo Cleared?

Not automatically. The record page lets you change Status after Cleared, but the clearing journal stays posted. If a cheque was cleared by mistake, reverse its clearing journal from the journals list and leave a note on the cheque.

Related topics

• Payments
• Bank accounts
• Bank reconciliation
• Reconciliation worksheets
• Journals
• Banking in xMatix Finance
• Cheque Transaction entity reference
• Cheque Register entity reference