Lost Checks - No Payee - Best Practice

[Eric Siegerman]

On 06/01/2015 09:11 PM, Milton Stern wrote:
 > As you suggested, I was considering not recording the checks at all.
 > But, I thought that the registers would be an good way of tracking if the
 > missing checks are ever used fraudulently?

The requisite I Am Not An Accountant caveat.  That said...

One possibility would be to create a "Lost Checks" account, of type 
Expense, specifically for this purpose.  Then record each check from the 
missing batch as a $0.00 "expense" -- credit the checking account as you 
normally would, and debit Lost Checks.

Obviously, my suggested name, Lost Checks, is just that -- a 
suggestion.  Use whatever name makes most sense to you.

As for the account's type, I don't think there's an obviously correct 
choice.  Any way of entering these zero-amount transactions feels like 
somewhat an abuse of the double-entry paradigm, which is designed to 
record things that *did* happen, not things that didn't :-)  But under 
the circumstances, a debit account feels like a less-bad fit than a 
credit account would.  That means a choice between Asset and Expense, 
and again, the latter feels like a better fit.  But that's only my 
opinion; yours may well differ.

I don't suppose the account type much matters to GnuCash, since the 
account will always have a zero balance anyway.  What's important, then, 
is doing something that you (and your accountant, if any) will find 
least confusing, months or years down the road when you've long 
forgotten the details.

(Speaking of forgetting the details, I'd recommend writing a thorough 
explanation in the Lost Checks account's "notes" field -- and a 
"pointer" to it in the "description" field.  Go into so much detail that 
you're sure you're going totally overboard :-)  Your future self will 
thank you!)

   - Eric