A bank statement is a sheet that contains every transaction carried out in an account, within a specified time frame. It contains several transactions, mostly revolving around credit and debit actions. If you issued a check, and it was skipped on your bank statement for that month, then it simply means the person you issued it to has not cashed or deposited the check.
Reconciling a bank statement
The act of reconciling a bank statement is a monthly activity for businesses and also financial institutions that handle their account. Basically, it collates a summary of every business and banking activity and reconciles it with the appropriate entity’s financial records for that month.
The statement outlines all the activities including withdrawals, deposits, and others that involved a transaction on that back account. A bank reconciling statement is a very good tool for tracking financial records and clamp down on fraudulent activities as a result.
Bank statement reconciliation and its correlation with skipped checks
A bank reconciliation statement keeps track to ensure that payment requests have been completed and cash collected or deposited to the bank, depending on the transaction. For credit requests, it ensures the money has been paid to the account, while debit ensures the money has gone out of the account to the appropriate channel.
It is useful in identifying the difference between the book balance and bank balance, in order to process and make appropriate adjustments in case of a mismatch. Bank statement reconciliation is usually done monthly.
Now, relating to skipped checks, when a check is skipped after you write it out, it would not appear as a transaction in your bank statement. This is because every money in the bank is noted, book balanced and reconciled. Instead, it would cause a disparity between the bank and book balance, since you might have recorded a debit in your book, but the sum still remains in your account.
To make up for the disparity, the bank would skip the check in your account statement and only include it after the check is deposited.
What is the implication of a skipped check on a bank statement?
When a check doesn’t appear on your bank statement, it simply means it has not been deposited or cashed, therefore no sum was debited from your bank account. There are a number of reasons why this could happen, which are:
The check has not been deposited
In this case, the check was not deposited at all, meaning that the person is still holding on to the check to cash some other time. A check that has not been deposited is like a pending debit that drops whenever the person decides to. However, checks usually have a life span, and if it’s not deposited within that duration, it is declared null and void.
It was written for sums more than was available in the account
On the other hand, skipped checks in a bank financial statement could also mean that the check was written for more than what was in the account at that time. Therefore, the person may have tried to deposit it, but it was not successful or bounced due to insufficient balance. Today, writing such a check is considered a crime in many countries, and punishable by the law, therefore, it’s best to abstain from such practice.