What is an Uncleared Check?

An uncleared check is a check that has not yet been paid by the bank on which it was drawn. Such a check has already been recorded by the payee and presented to its bank. There is a clearing cycle that must then be completed that lasts several days. During the clearing cycle, the payee's bank presents the check to the payer's bank, which then forwards the cash amount stated on the check to the payee's bank. During the clearing cycle, the payee does not have use of the cash.

Terms Similar to Uncleared Check

An uncleared check is also known as an outstanding check.

Example of an Uncleared Check

International Hats imports unique hats and then sells them to its discerning clientele within the United States. Anna, the controller, writes a $2,500 check to her freight forwarding company on March 1. She records this in the company’s accounting software on that date, which reduces her cash book balance by $2,500 and eliminates the related payable obligation.

At month-end, Anna conducts a bank reconciliation and notes that the check has not yet been deducted from the company’s bank balance. This means that the check has not cleared the bank, so the check can be classified as an uncleared check. She records the uncleared check on her bank reconciliation as a reconciling item. She also contacts the freight forwarding company to see if they ever received the check, since such a long delay in check clearing could mean that the check has been lost in the mail.