Cheque is Presented at Bank for a Different Amount in Strata Master
Cheques that are presented for an amount that is different to the amount entered in STRATA Master can arise for the following reasons:
- Mistake made when issuing a manual cheque and the amount written on the cheque differs from the amount entered into STRATA Master.
- The bank misreading of the amount written on the cheque.
- Fraud, where someone changes (usually increases) the amount written on the cheque.
Mistake When Issuing Manual Cheques
The most common reason for the difference is mistakes made when using manual cheque books. Entering the cheque details in STRATA Master first, printing the remittance advices prior to writing the cheques and then careful checking during signing of the cheques should reduce these errors.
Bank Misreading Amount of the Cheque
Misreading of the amount on a cheque by the cheque processing bureau can occur with incorrect alignment of computer generated cheques, cheque stationery, and alignment of cheque stationery in the printer. Checking the alignment of printed cheques from time to time can reduce the incidence of this problem, but it is understood that misreading can still occur if a cheque is accidentally damaged after it is sent to the creditor. It may occur that the cheque is manually encoded by Bank staff and a damaged cheque is misread..
In some cases it may be necessary to obtain the processed cheque from the bank. This would be necessary if fraud is suspected as the Payee as well as the amount may have been fraudulently entered. Fraud should be pursued with the bank and the Police This, however, may take some time. Journal adjustments may need to be made to reflect this situation and it is suggested that clients call Strata Master Support for assistance.
If You Use Bank Download
The automatic processing of downloaded bank statements will not present a cheque in STRATA Master if the amounts do not agree. The download exception report will flag such cheques for attention.
Steps To Correct A Mistake or Bank Misread of the Amount.
Firstly it is necessary to identify the cause of the incorrect amount. The cheque should remain Unpresented until the cause is identified as a mistake or Bank misread and can be corrected. in Strata Master. Note that the Bank is unlikely to correct a misread of a cheque, so it is necessary to match the Banks read.
The correct procedure to follow when a cheque has been presented for a larger amount than entered on STRATA Master and the bank is not expected to make good the difference is as follows:
- Present the cheque in STRATA Master,
- Use the add function under the Manual bank reconciliation screen Withdrawals section for the additional amount clearly identifying the cheque that this relates to and selecting an appropriate expense account (usually the account used for the original cheque).
- If a single (general) trust account is operated it will be necessary to create a journal to debit an appropriate expense account and credit the Cash at Bank.
- This will now reconcile the bank.
- If the creditor has been overpaid either request a refund from the creditor or issue a credit note that will reduce the next payment to that creditor
If a cheque is presented for a smaller amount than the amount entered on STRATA Master the following procedure applies:
- Present the cheque in STRATA Master.
- Create a Journal entry to debit-- Cash at Bank and credit--the original expense account.
- Enter the amount as the figure that is the difference between the Bank statement figure and Strata Master figure, where doing so deducts this amount from the Strata Master record and reflects the amount paid to the creditor by the Bank.
- This will now reconcile the bank.
- Reissue a new cheque to the creditor for the amount that was short paid by the Bank.