Bookkeep uncleared checks

When you reconcile your bank account, Wave compares the total of all transactions entered under that account with the bank statement balance you enter. When the balances match, your account is reconciled. However, if you deposit a check, which then clears after the bank statement closing date, this will cause the account to no longer be reconciled.

One resolution is to change the date on the check transaction to match the date it clears the bank. Alternatively, only use the imported transaction from your bank connection or statement upload as your record, and skip recording the check when you write it.

However, if you prefer to keep a record of the checks you’ve written before they clear and want to ensure they reconcile in Wave, you can use a Money in Transit account. Follow the steps below to bookkeep uncleared checks using this method.

Learn about Money in Transit accounts in Understand how Money in Transit accounts work in Wave.

Add an account for outstanding checks

  1. On the left navigation menu, click Accounting > Chart of Accounts.
  2. At the top right, click Add a New Account.
  3. In the Account type field, select Money in Transit.
  4. Enter a name for the account like Outstanding written checks.
  5. Click Save.

The Money in Transit account currency should be the same as the bank account the checks are written from.

Reconcile a period with an uncleared check

You can continue recording checks you've written by creating expense transactions, using your bank account as the Account. When you have an uncleared check preventing reconciliation, here's what to do:

  1. Identify the outstanding check on the Reconciliation screen. Click anywhere on the transaction line to open the transaction details pop-up box.
  2. In the transaction details pop-up box, click the Account field drop-down, then select the Outstanding written checks account under the Money in Transit section.
  3. Click Save.

    You'll see a warning appear that this transaction will no longer appear in this account, which can be ignored since it is resolved in the steps you take after the check clears.

Now you've successfully reconciled your bank account.

Here's what it looks like on your reports:

The expense is included in your Profit & Loss report

The account balance matches the bank statement balance, while the Money in Transit account balance equals the check that hasn't cleared.

Create a transfer when the check clears

When the check clears your bank account, and the transaction imports into your Wave account through your bank connection or statement upload:

  1. On the left navigation menu, click Accounting > Transactions.
  2. Find the cleared check transaction and categorize it to Transfer to Bank, Credit Card, or Loan, then select your Outstanding written checks account.

Now you can reconcile your bank account, the check is recorded in the proper time period, and the balances in your accounts are correct.

The transactions in your Outstanding written checks account will appear in all of your reports. However, the transfer between this account and the bank account is irrelevant for reporting purposes and won't appear.