David:
“The Zero cheque can be used – providing the negative amount remains. Then the zero cheque is compliant. However if you issue a zero cheque, and remove the negative amount / the offset to the payroll account is not correct. In this context – I was suggesting the zero cheque is not GAAP”

There is no change made to the Original payroll distribution entries. An new line is added to Add Back an amount so the distribution is brought to a zero balance. The cheque line is Zero’d out since NO cheque is actually printed or issued.

There are many transactions where GAAP is not followed to the letter, but the clients are not accountants. They want the figures to reflect things they understand. If someone is overpaid then they want to show the person he did get paid for the hours worked, and they want the balance outstanding to show up on the AR or Advance account (to be deducted off the next cheque).

Post Edited (04-22-04 22:13)