transaction date

[Andrew Sackville-West]

On Tue, Mar 11, 2008 at 05:44:56PM -0700, Yogesh Agrawal wrote:
> Hi,
> I have a question regarding the transaction date, I will explain this with
> an example:
> 
> I transfered $100 from Citibank to BOA on 01/01/2008.
> The amount has been debited from citibank account on 01/01/2008, but it got
> credited to
> BOA on 01/03/2008.
> 
> So when I put this transaction on citibank account I put it on 01/01/2008
> at the same time I do a transfer to boa. So on boa the date comes as
> 01/01/2008, but it has
> to be 01/03/2008.
> 
> If anybody knows any better way to do it, please let me know.

This question comes up a lot and I'm not sure why it gives people
difficulty... It is perfectly reasonable for funds to be in transit
for a period of time. It is the same as writing a check. 

When you write a check to pay someone, you record the check on the day
it is written. Now that check may not actually clear your bank for
days or weeks (or even forever). But one generally doesn't go around
changing the dates of checks in their check register to coincide with
the date the check cleared the bank. Also, in this case, there is a
period of time when your records show that you've paid some bill with
a check while that vendor's records show that you haven't paid that
bill (check is still in the mail, for example). This is also perfectly
reasonable. 

The short version is that there is nothing incorrect about having the
dates not match perfectly on both ends of a transaction. You record
your transactions on the day you initiate them. Other parties involved
in the transaction record them on the day they process them. These
dates don't match and that's okay. 

If for some reason you need to keep specific track of the dates money
moves into and out of accounts on both ends of the transaction, then
do as Mike suggested and use an interim account ("Funds in
Transit"). Note though that there will then be a disconnect in the
transaction. THe money out of one account will not directly point to
the other account in which it is deposited.

A
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