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A post dated check is a check on which the issuer has stated a date later than the current date. A post dated check is used in the following situations:
From the perspective of the check issuer, there should be no journal entry to record the reduction in cash until the date listed on the check. From the perspective of the recipient, there should be no entry to record the increase in cash until the date listed on the check. Thus, the date on the check effectively postpones the underlying accounting transaction.
For example, ABC International receives a $500 check payment from a customer for an unpaid invoice on April 30. The check is post dated to May 15. ABC should not record the cash receipt until May 15, nor should it reduce the related accounts receivable balance until May 15. Thus, the post dated check has no impact on the financial statements of ABC International until the date listed on the check.
Realistically, the recipient of a post dated check may never notice that the check has been post dated, and so will record and deposit it at once. The bank is also unlikely to notice the date on the check. In this situation, the check is considered a negotiable instrument, irrespective of the date, and it is likely that the recipient will receive cash from the bank prior to the date on the check. In such a situation, it is allowable for the check recipient to record a post dated check upon receipt of the check.
From the perspective of the payer, the best way to ensure that funds are not released early is to notify the bank not to release funds against this check any earlier than the date stated on the check.
Auditors do not like to see post dated checks, since it implies that the payer is short on cash, and is attempting to pay bills later than it should. If an auditor sees an ongoing pattern of check post dating, there would be an inclination to delve more deeply into company finances, and perhaps state a going concern issue in the audit opinion that accompanies the financial statements.
Post dated cheque is cheque issued to suppliers on a future date or cheque received from customers on a future date.
If we receive a post dated cheque from customer:
Accounting Treatment:
Create a PDC received account under current assets and Debit PDC received account and credited to customer account. When cheque is cleared from bank Pdc account credited and debited to bank account.
PDC cheque issued to suppliers:
Create PDC issued account under current liabilities
Debit supplier account and credit to PDC issued account
When cheque is cleared from our bank account. PDC issued account debited and credited to bank account
The Post Dated Cheques are those cheques which are issued for the future dates and it could not be cashed before the date which is present on it.
post dated cheque are received by the debtors by mentioning the cheque date as future date .
Hence after the cheque is matured , bank - debit and debtor - credit
we can treat the cheqeue as laibility
make one list in excel, and update the post date cheque receivable. deposited cheque remove from the list
PDC Called Post Dated Cheque: When you ordering goods suppliers may asked you Advance cheque in future dated like 30 days after or 60 days after based upon agreed terms with them.
Supplier asking PDC Cheque for their Security purpose. We have to make sure whenever we are releasing cheque we have monitor and show as payable in our account.
Once its due we have consider as Paid.
Post dated cheques are cheques written by a drawer to be cashed in a date in the near future and are supposed to be kept until the date that they are supposed to be cashed and can be entered into your cashbook the same day they are supposed to be cashed
