Suspense Account
Definition
A suspense account is a temporary account used when the bookkeeper does not yet know where a transaction belongs. It should be cleared as soon as the correct account is determined.
Example
A $2,500 bank deposit appears with no description. The bookkeeper puts it in a suspense account until the owner confirms what it was for.
Why It Matters
A balance left in suspense means the books are not finished. It should be investigated and cleared before the period is closed.