When you void a check, QuickBooks:
- changes the original amount of the check to 0.00
- adds the text VOID: to the beginning of the Memo
- sets the cleared flag, Clr
When you’ve specified that your books are closed through a given date, in addition to performing the above steps, QuickBooks gives you the option of automatically adding reversing general journal entries so that accounting reports for the closed period are not affected. However, this option to automatically add a reversing general journal entry comes with a big stipulation: the accounts associated with the check must be expense accounts. If they’re other account types, you’ll have to construct reversing general journal entries on your own.
A bill payment check is similar to a check, but it is actually a different transaction type. QuickBooks only provides the option to automatically reverse voided checks, not bill payment checks. Later in this article, we’ll describe how to manually make the reversing general journal entries when voiding a bill payment check from a closed period.
To see this process in action, first verify your Closing Date. You can find it by clicking on the Company->Set Closing Date… menu selection.
For our sample company, the Closing Date has been set to 11/30/2013. If you void any check dated on or before this date, QuickBooks will give you the option of automatically creating well-documented reversing general journal entries that will maintain the accuracy of your accounting reports for the closed period.
To void a check, you can either right click on the check in the bank account register to invoke the context menu and select Void Check or you can select the check in the register and choose Void Check from the Edit menu. Both paths take you to the same destination.
Since check # 5244 is dated before the Closing Date, voiding it will bring up this warning:
You have the option of simply voiding the check and not having QuickBooks create the reversing general journal entries. Just click the No, just void the check button. However, unless you manually create reversing general journal entries, financial reports from the closed period will no longer be accurate, since the check amount was just changed to 0.00. Even if you intend to modify the reversing general journal entries (such as to add more information to the Memo), it’s a good idea to click the Yes (Recommended) button.
Clicking the Yes (Recommended) button causes QuickBooks to automatically perform these steps:
- create a reconciled general journal entry on the date of the original check
- create a reconciled, reversing general journal entry on the date you voided the check
- add additional text to the Memo of the voided check to refer to the journal entries made
The general journal entry on the date of the original check:
The reversing general journal entry on the date the check was voided:
The updated memo on the voided check that refers to the general journal entries:
Note that QuickBooks automatically sets the Clr flag for both journal entries, just like it does for the voided check. By doing so, voiding the check and recording the reversing journal entries will not interfere with your bank reconciliation.
Recording these journal entries preserves the accuracy of your financial statements for the closed period. If you simply voided the check and didn’t record these entries, rent expense for the closed period would be lower than previously reported on your financial statements or tax returns. That inconsistency can lead to questions about the reliability of accounting information and cause time to be spent trying to reconcile the difference. Well-documented general journal entries eliminate the potential for inconsistency.
The reversing general journal entry puts a credit to rent expense in the current period. If you were voiding the original check because it was never cashed and you now plan to issue a replacement, the credit and the replacement check will offset. That way, your expenses (or the accounts on the original check) are not overstated in the current period. If you were voiding the check and you don’t plan to reissue it, expenses for a closed period were overstated, and they’ve been adjusted in the current period – when the overstatement was discovered.
QuickBooks did a lot of work once you clicked on the Yes (Recommended) button. But don’t forget that the entire process is triggered by setting your Closing Date. If you haven’t done that, QuickBooks won’t go through these time-saving steps because it lacks the information to do so.
For bill payment checks, QuickBooks won’t automatically perform the steps described above, so you’ll have to go through them manually when voiding a bill payment check in a closed period. Those steps are:
- void the bill payment check, noting the vendor; voiding the bill payment check will turn the bill into an outstanding A/P balance
- record a general journal entry on the date of the original bill payment check with the first line on the journal entry as a debit to accounts payable; record the vendor in the Name column on this line; the second line of the journal entry is a credit to the bank account from which the bill payment check was written
- record a general journal entry on the date the bill payment check was voided with the first line on the journal entry as a credit to accounts payable; record the vendor in the Name column on this line; the second line of the journal entry is a debit to the original bank account
- use the Vendors->Pay Bills function to use the older general journal entry to pay the original bill
- pay the newer general journal entry in the normal course of business
It’s important to note that the procedures described here cover voiding – but not re-issuing – a check. If you need to re-issue a check, you’ll have to do so in the current accounting period. Voiding a bill payment check leaves a current accounts payable balance for you to pay in the current period. If you want to void a bill payment check in a closed period and cancel the original bill, you’ll need to record a bill credit in addition to the steps outlined above.
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“For our sample company, the Closing Date has been set to 11/30/2013. If you void any check dated on or before this date”. Don’t you mean “on or AFTER this date”? Thanks so much for this article.
Hello, I need help with a bill that was entered twice in 2014. The bill was paid in 2014, however, the second entry continues to remain outstanding as a receivable in current year. How can I reverse this in the current year? Thanks for your help. Hansa
I have QB 2012 non profit edition and am trying to void a check in a closed period. I am not getting the option for QB to automatically add reversing journal entries. I am voiding checks attached to expense accounts so I \’m not sure why I’m not getting that action from QB. If I void checks from previous closed periods, my reconciliations will all be incorrect.
Thanks for your help.
I have QuickBooks Enterprise Solution 15 and I am having the same issue as Shirley. I am not getting the option for QB to automatically add reversing journal entries. The transactions ARE attached to expense accounts only, so I am not sure why I am not getting this option that the instructions mention. Is my only option to make manual journal entries?
Re: step 4) use the Vendors->Pay Bills function to use the older general journal entry to pay the original bill. How do I use a journal entry to pay a bill? My QB is set up so that I can only select my savings or checking account to pay bills.
Did you try it?
Liabilities such as A/P are credits on the balance sheet. When you record a GJE that is a debit to A/P, you’ll see an available credit (reduction in A/P) for that vendor when you use the Pay Bill functions. You’ll be able to select that GJE to pay the bill, which will result in no cash outlay if it pays it in full.
Does the date of the bill payment in step 4 matter since it is a zero dollar transaction?
I want to void the check but not the voucher as I need to reissue the check. The check was generated in Jan 2014 and the period is closed. I want to void the check in June and reissue the check. Can I void the check with a June date and reissue. It is only the A/P and cash accounts that are affected?
Thanks,
Richard
Is Jan 2014 in a different fiscal year than June 2014? The notion of a closed period in QB only applies to fiscal years, not months. Yes, voiding a bill payment check will only impact cash and A/P. The original bill will be unpaid, allowing you to pay it with a new check.
When you void a check dated in a closed period, QuickBooks warns that it could affect the accuracy of your prior period reports and account balances. – I am not getting this warning even though my periods are closed. Can someone shed some light on how we get this to show because when I void cheques from a closed period, it changes it in the closed period and does not do the journal entries which the above suggests should happen automatically.
Take another look at our article. We added a clarification near the top that covers your issue. For more information, see this Intuit support article. If the accounts associated with the check were not expense accounts, then the behavior you observed is the norm. Based on your spelling of “cheque”, it’s not clear that you’re running the US version of QB, and our comments here only apply to US versions; the version in your country may function differently.
If I get a prompt from Quickbooks advising me to click on “Yes (Recommended),” that would allow it to create an automatic journal entry to a voided check dated for a future date but in the same month. What should I do? Is QB interpreting the future dated check as after the closing period?
Is the check merely a date in the future or is it in a new closing period? It is possible for your future date to be a date that is in a new closing period. Normally, you’ll only see those prompts when voiding a check in a prior period. If that’s not the case, then it sounds like something unexpected is happening.
I had to void a check after the closing period, so I did a journal entry (debit bank acc – credit expense acc) but what do I do with the bill as it stays there and I can not amend it to issue another, so i can print another check with the correct amt? If I create another bill it will show up as an traditional amount on my bill report.
pls advise
Your method to voiding the check wasn’t ideal. That’s why the bill is marked paid. Instead, follow the steps outlined in this article. Start by deleting or voiding your general journal entry. Then, void the bill payment check and let QB create a reversing entry. That way, your bill will be unpaid and you can issue a new check to pay it.
CHIEF, THANKS FOR YOUR FAST REPLY!
CAN I VOID THE CHECK FROM THE REGISTER AND THEN REISSUE IT FROM THE SAME BILL?
You should be able to void the check from either the register or by navigating to the vendor in Vendor Center.
The box asking if I would like to create a general journal or just void the check does not appear. Can you tell me how to set that as a preference. It just voids the check, even prior to the close date. (after asking me for the password of course)
I have Quickbooks Pro 2011
Perhaps this Intuit support article on voiding checks can shed more light.
The box asking if I would like to create a general journal or just void the check does not appear. Can you tell me how to set that as a preference.
Can you provide more info on your QB installation – Pro, Premier, or ES? Version (year)? Release? You can press F2 within QB to get this info.
what s the difference between reversing and voiding a General Journal
Voiding a transaction, such as a general journal entry (GJE), sets the amount to 0 and puts “VOID:” in the memo. Reversing a GJE takes the debits and credits and swaps or reverses them in the next year. For example, let’s say you credit cash and debit an expense account in 1 accounting period, and opt for that GJE to be reversed. On the first day of the next year, QB will generate a transaction that debits cash and credits the expense account, so that after the date of the reversal, there is no impact on any of the accounts in the GJE. Voiding a GJE wipes out the original impact of the entry on that date. Reversing a GJE only wipes out the impact after the reversal is recorded, which is in the year following the original entry.
I am using QB Enterprise. I voided a Bill Pay Check from the Check Register. QB show me a message that this would show the invoices involved as open. I cannot find those invoices.
This is in a current period.
I think you mean “bill” instead of “invoice”. Open Vendor Center, scroll down to the vendor to whom you issued the bill payment check, and the bills you paid with that check should appear in the vendor’s account with an open balance equal to the amount that was included on the bill payment check.
I followed your directions for voiding a bill payment check in a closed period. I am not sure what you mean by steps 4) and 5).
Step 4) says “…use the older general journal entry to pay the original bill”. Does that mean to use the Journal Entries Acct 1099 as the payment Account? That leaves the Journal Entries account with a negative balance.
Step5): “Pay the newer general journal entry in the normal course of business.” I don’t know what that means. Can you give more detail?
We are a church using QB Premier Nonprofit Edition 2009.
Thanks!
I wrote a check in qb and balanced the statement, but never attached the bills. I cannot delete the bills and I cannot attached them to the cleared check what do I do?
Kay – Can you clarify your question? You say that you “never attached the bills” – are you referring to making use of QB Attached Documents? Are you using online or local storage? Are you trying to attach a vendor bill to a check that you’ve already written? With a little more information, we can probably point you in the right direction.
Thanks. It is helpful. I will follow this way.
Chief Mechanic,
Can I void a bill payment check like this:
Don’t void the check in a closed period. But make notes.
Make a reversing deposit in current period.
Enter a replacement bill in current period. (If the original bill is canceled, don’t need to enter the replacement.)
Pay the new bill in the future.
Thanks.
I wouldn’t do it exactly as you described, but you’re suggestion is pretty close. You could: 1) don’t void the check in the closed period but make notes (as you wrote), 2) make a general journal entry with a credit to the bill’s expense account and a debit to the bank account on which you wrote the bill payment check; I would not use a deposit, as you suggested, 3) enter a replacement bill, 4) pay the replacement bill in the future. The key difference is to use a general journal entry as opposed to a deposit, and be sure to take advantage of the Memo field to describe why you’re recording the general journal entry. This highlights that in accounting, as in QuickBooks, there is often more than 1 method to achieve the same goal, sometimes with little advantage from one method to the next.
I followed your directions here for voiding a bill payment check from a closed period and reissuing a new check. However, the vendor account now has a credit balance in the amount of the voided check. My BS accounts payable and bank account balance checks out but I cannot clear this credit balance.
Thank in advance.
John – Just to clarify, you did note that the steps for voiding a bill payment check – which is different from a regular check – are at the bottom of the post? Can you relate what steps you performed, even using dummy names and amounts? If you followed those steps, you should observe the following: 1) after this step, your vendor has a balance, since you just voided the bill payment check, 2) after this step, the vendor’s balance as of the closed period is back to $0 (assuming no other transactions), 3) after this step, your vendor is owed the original balance as of the date you voided the bill payment check, 4) after this step, the original vendor bill and the 1st general journal entry are matched, so they will no longer appear on A/P reports, and finally 5) after this step, your vendor’s balance should be back to the level before you voided the bill payment check.
Try following the transaction after each step and let us know where the breakdown occurs.