should be charged to the general account. Most banks, however,
have a policy of not charging the school accounts for services.
Occasionally, a service charge will be made to a school account
through error. The bookkeeping department of the bank should
be notified immediately. The bank will issue a credit to the
school account, offsetting the erroneous charge. Neither the
charge nor the credit need be shown in the books of record.
 "Bad" Checks-Some checks deposited by the school may be
 returned by the bank for various reasons. The most common
 reason is insufficient funds in the account of the person who
 drew the check. The proper procedures for handling checks of
 this type follow:
 a. If the check is made good immediately, the money should
 be marked as a re-deposit and not considered as an addi-
 tional receipt or expenditure. This re-deposit should be
 deposited as a separate item and marked as a re-deposit
 of check # (number). The charge back of the initial de-
 posit and the credit of the re-deposit by the bank on the
 bank statement should be clearly identified and noted on
 the statement by the school bookkeeper. It is not neces-
 sary to enter the charges or re-deposit in the books of
 record.
 b. If it is found that the check will never be made good,
 the amount of the bad check should be entered in red in
 the "Received" column on Form FA-10-P (Depository
 Ledger) and the appropriate column on Form FA-12-P
 (Distribution of Receipts). The amount of the bad check
 should be deducted from the available balance in the
 checkbook with complete explanation. The bad check
 should be filed with the bank statement for substantiation
 of the above entry.
 Cancelling Outstanding Checks-If the check is cancelled
before the end of the month in which it was issued, it is necessary
to VOID the entries in all places that the transaction was en-
tered. If the check is to be cancelled after the month in which
it was issued, it should be posted in red in the "Totals Paid
Out" column of the Depository Ledger and should also be posted
in red in the appropriate column in the Distribution of Expendi-
tures. The amount of the cancelled check should also be added
back to the available balance shown in the checkbook. Care