Sometimes you need to cancel a cheque. The cheque may have got lost, or a customer's cheque may be rejected by the bank.

To cancel a cheque:

· Process the cancellation in the same entry type as the one in which you entered the cheque.

· Use the same reference as you used on the cheque. This will ensure that your reconciliation balances.

· To remove the cancelled item from the reconciliation, reconcile that reference number which should be zero.

· If you are using an open item account, leave the allocation as unallocated. Once you update the batch, use the Process...Open Item Re-allocation menu option, and allocate the reversal to the original invoice. You will then, at a later stage, be able to allocate a payment to that invoice.