Outstanding Check

Outstanding Check Definition

An outstanding check is a check that has been written and recorded in your books but hasn't been cashed or cleared by the bank yet. Until the recipient deposits it and the bank processes it, the check remains "outstanding." This creates a temporary difference between your book balance and your bank statement balance.

Outstanding Check in Practice — Example

A landscaping company writes a $2,500 check to their equipment supplier on March 25th and records it immediately in QuickBooks. When the March bank statement arrives, that $2,500 hasn't been deducted yet because the supplier didn't deposit the check until April 2nd. During bank reconciliation, the bookkeeper lists this as an outstanding check to explain why the bank balance is $2,500 higher than the book balance.

Why Outstanding Check Matters for Your Books

Outstanding checks are one of the most common reconciling items between your books and your bank. If you don't track them, your cash balance looks higher than it actually is — and you might accidentally spend money that's already committed.

For small businesses, outstanding checks can also create confusion around month-end and year-end reporting. A check written in December but cashed in January still counts as a December expense. Knowing which checks are outstanding helps you report expenses in the correct period.

Stale outstanding checks (typically over 6 months) create their own problems. You may need to void them, reissue them, or in some states, report unclaimed funds. Keeping a clean list of outstanding checks prevents these headaches.

How Outstanding Check Shows Up in QuickBooks

In QuickBooks Online, outstanding checks appear during bank reconciliation. Go to Settings → Reconcile, select your bank account, and QBO will show uncleared transactions. Outstanding checks appear as uncleared items that reduce your reconciled balance. You can also run the "Reconciliation Discrepancy" report to spot checks that have been outstanding for an unusually long time.

Common Mistakes

Not reconciling monthly — outstanding checks pile up and become harder to track

Spending the "extra" cash — your bank balance looks higher than reality because the check hasn't cleared yet

Letting checks go stale — checks outstanding for 90+ days should be followed up on; 180+ days may need to be voided and reissued

FAQ

Q: How long can a check stay outstanding? A: Most banks honor checks for up to 6 months (180 days). After that, the check is considered "stale-dated" and the bank may refuse to process it. You'd need to void the original and issue a new one.

Q: Do outstanding checks affect my profit and loss? A: No — the expense was recorded when you wrote the check. Outstanding checks only affect your cash balance on the balance sheet and show up as reconciling items.

Related Terms

Reconciliation

Petty Cash

Payable

Undeposited Funds

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