Outstanding Check
Definition
An outstanding check is a check the business has written and recorded in the books but has not yet cleared the bank. It is a legitimate timing difference in a bank reconciliation.
Example
The business writes a $500 check on March 28. The bank statement was cut on March 31 and does not show the check yet. It is an outstanding check.
Why It Matters
Outstanding checks explain part of the difference between the bank balance and the book balance during reconciliation.