Outstanding checks and deposits in transit, explained

Short answer: they're timing differences. You recorded the transaction in your books, but it hadn't reached the bank by the statement date. They're normal, they explain part of the gap between your bank and book balances, and they should clear on next month's statement.

Outstanding checks

A check you wrote and recorded, but which the recipient hasn't cashed yet, or which the bank hadn't processed by the statement date. Your books already show the money gone; the bank still shows it there.

In the reconciliation: subtract outstanding checks from the statement balance to get the adjusted bank balance.

Deposits in transit

Money you deposited and recorded, but which the bank hadn't added by the statement date, typically a deposit made on the last day of the month or after the bank's cut-off time.

In the reconciliation: add deposits in transit to the statement balance.

Example

Item	Amount
Statement ending balance (Sept 30)	$34,760.15
− Check #1051, written Sept 27, not yet cleared	−$340.90
− Check #1052, written Sept 29, not yet cleared	−$1,367.61
+ Deposit made Sept 30, not yet on the statement	+$1,845.00
Adjusted bank balance	$34,896.64

This adjusted figure is what you compare with your book balance (after recording any bank fees or interest from the statement).

When an old one needs attention

A check outstanding for several months may have been lost, never delivered, or voided without being recorded. Contact the payee. If it really won't be cashed, it may need to be voided in your books. Unclaimed funds can have legal reporting rules, so ask your accountant.
A deposit in transit older than a few days is not normal. The deposit may never have been made, may have gone to another account, or may have been recorded twice.
The same item showing as "outstanding" month after month is usually a mistake hiding in plain sight.

Common mistakes

Adding outstanding checks instead of subtracting them (or the reverse for deposits).
Treating every unmatched book line as "timing" without checking its date.
Recording an entry to make an old outstanding check "go away" without finding out what happened.

See your timing items automatically. RecProof lists every line that's in your books but not on the statement, and the reverse, with dates, so old items stand out. It's free and runs in your browser, so nothing is uploaded. Open the free self-check →

General guidance, not accounting or tax advice.