PSA L&P - Checks: How to correct or edit a line item (account) used in a bill or a check

How to correct or edit a line item (account) used in a bill or a check

A check records a credit to the bank account and an offsetting debit to one of the following account types: (recorded on the invoice date for accrual users and the check date for cash users)

  • Expense Account 
  • Dedicated Account

Once a check has been printed or created through the assign check number feature, it can not be edited. It may be possible to delete the check if certain criteria are met such as user permissions allows this and the check has not been marked on a bank reconciliation.

This article assumes you cannot delete the check and that the only thing wrong with the check is that an incorrect distribution account was selected.
check_distribution_and_transaction_dates.jpg

How to determine the date of the correcting transaction

The transaction date for the correcting journal entry will be different depending on if you are under an accrual system of accounting or under a cash system of accounting.

  • When under an accrual system of accounting, the date of the correcting transaction will be the bill date.
  • When under a cash system of accounting, the date of the correcting transaction will be the check date.

How to determine what to debit and what to credit in the correcting transaction

The journal entry must reverse the original transaction and add the new transaction. The original transaction debits the distribution account. To correct the distribution account you must:

  • Credit the original distribution account
  • Debit the correct distribution account

 

Bringing it all together

To make a correcting journal entry for the check above assuming it was created on an accrual system of accounting, the following entry will be made.
entry_when_accrual.jpg

To make a correcting journal entry for the check above assuming it was created on a cash basis of accounting, the following entry will be made.
correcting_entry_on_cash_basis.jpg

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