Get to know the types of checks and how they are used

checks are one of the securities that have a function as a medium of exchange such as money. To make a check, the customer must first open a checking account with the bank concerned.

The legal basis for regulating checks is regulated in Articles 178 to 229 of the Commercial Code. In addition, there are additional explanations contained in the Circular of Bank Indonesia. In Article 178 of the Commercial Code, where a check must meet the formal requirements as follows.

1. The name ‘Check’ must be contained in the text.

2. Unconditional orders to pay a certain amount of money.

3. Name of the party who must pay (interested).

4. Appointment of the place where payment must be made.

5. Statement of date and place of check drawn.

6. Sign the person who issued the check (withdrawal).

Check Types

Check on behalf of
Is a check issued on behalf of a person or certain legal entity written clearly in the check. For example if in a written check the order pays to: Pay a total of IDR 4,000,000 or pay to PT. Marindo has a total of Rp.2,000,000, so this check is called a check on behalf, but with a note the word “or carrier” behind the name ordered is crossed out.

Top Check Performance
Show checks are the opposite of checks on behalf of. In a check on the performance, there is no written name of a person or legal entity so anyone can exchange checks or in other words checks can be cashed by the checker.

Cross Check
Cross check or cross check is a check in the upper left corner given two crosses. This check is intentionally crossed, so that the check function that was originally cash changed to non-cash or as a transfer.

Reverse Check
Is a check that is dated back from the current date, for example Mr. Budiman received a check on the May 10, 2006 tag, but in the check it was written on May 15, 2006. It means Mr. Budiman can only withdraw the check according to the date stated in the check. This type of check is called a backward check or a check that has not yet matured, this usually occurs because there is an agreement between the giver of the check and the recipient of the check, for example because it does not have funds at that time.

Blank check
Blank checks or blank checks are checks whose funds are not available in the checking account. For example, Mr. Rahman Hakim drew a check worth Rp60 million written in the check, but the funds available in the checking account only had 50 million rupiah. This means a lack of funds of 10 million rupiah, if the customer withdraws. So clearly the check is less in number compared to the amount of funds available.

In the business world, the use of checks as a means of payment is very common. Usually, check payments are carried out by the client or business partner for the sale of company products on credit, which means that they will indirectly be included in the cash receipt account statement from the accounts receivable or vice versa, the use of checks as a company payment tool to business partners that will be recorded in cash expenditure journal account.

In the use of checks as a payment instrument in this business field, the bank will be an outsider who will be involved in recording the transaction. Because of this involvement, the company requires data reconciliation for the bank.

The online accounting software journal , provides a simple and practical way for companies that want to reconcile and get reports on all financial data related to the bank through its cash link feature . Journals are also connected to several banks directly, so that they can receive data on recording transactions from the bank with the company’s approval without having to wait for reports.

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