This document explains how to report and reconcile remitted customer checks or drafts that remain unpaid.
Customer checks and drafts can remain unpaid for the following reasons:
For regular checks and preliminary postdated checks (type 2), the bank report is the final confirmation that the customer payment is made or cannot be made. However, definite postdated checks (type 1) are managed like drafts in M3.
Bank remitted but rejected customer checks or drafts are reported to the system as unpaid. An accounting journal and a customer payment journal are printed.
Since invoices covered by the rejected checks or drafts are reopened, you can allocate those invoice records to later payments in 'Payment Received. Record' (ARS110).
Accounts receivable and the general ledger are updated. See the respective instruction for more information.
When you receive the bank report, contact the payer to find out why the payment document was rejected. You can then decide how to proceed:
Report Customer Check/Draft Rejected by Bank
Report rejected checks and drafts in 'Draft/Check. Report Unpaid' (ARS340). This includes checks that have been remitted to bank as well as checks that were rejected by the bank when you tried to cash them manually.
The drafts reported can be rejected before or after having been reconciled, although it is more common to use (ARS340) for reporting discounted and already reconciled drafts.
Report Remitted Draft/Definite Postdated Check Rejected by Bank before Collection
An alternative way to make it possible to remit the payment document again for collection is to remove the payment documents that have not been reconciled from the list of remitted payment documents in 'Bank Remittance. Update Payment' (ARS351); the program is called from (ARS350). The documents are automatically returned to their initial not remitted status and can be included in a new bank remittance statement.