How shall we deal with cheques pending in books for six months?

write stop payment letter to the banker & make a reverse entry in the books

Cheques pending in books of account for six months or more is regarded as stale cheques and can not be honured or paid by the bank when presented. There are vairous reasons that accounts for a cheque to be stale example, being misplaced or lost. Whatever the circumstance may be you need to find out from the supplier or vendor with whom the has been issued to in order to ascertain the reasons why the cheque has not been presented for payment. Afterwards you need to reverse the entry thus

Debit Bank Account

Credit Supplier Account

This will indicate that the supplier has not been paid and as such the amount will still be part of the total payables in the books of account.

While issuing Cheque when the purchases are made.

1) Expance A/C Debit

    Creditor A/C          Credit

2) Creditor A/C Debit

     Bank A/C             Credit

Now if the above cheque is lying unprecedented in the books of accounts for more than six months.

Bank A/C          Debit

Creditor A/C              Credit

Treatment of original cheque issued for the first time when the purchases are made.  For example a stationery of $1000 were purchased.  Then the journal entries would be as follows.

1st Entry

Stationery A/C                     Debit

Creditor A/C                                     Credit

2nd Entry

Creditor A/C                       Debit

Bank/Cash                                     Credit

Now if the above cheque is lying unpresented in the books of accounts for morethan six months, the following treatment should be made in the accounts.

Bank/Cash                    Debit

Creditor A/C                           Credit

As my opinion cheques should not be so long outstanding, to avoid such circumstances we should regularly prepare the bank reconciliations and followup with the vendors who are not presented the cheques for payment.