It’s way easier and more reliable to keep track of money in an accounting system than in random tiny pieces of paper. Money is safer in a bank account than as a tiny piece of paper.

In terms of business process, it’s better to have one single standard procedure of depositing (not cashing, ha) every check right away. Rather than asking any person handling a check to go through some sort of decision tree on the spot.

If you need to return the money later you can always cut your own check.

If you deposit a check for which you have no receivable or sale, what entry do you make in the accounting system?

You use a suspense account.

It is typical in the health insurance billing world where the check is sent separately from the explanation of benefits which details how they are paying for everything. You may get a random check in the mail that is paying for claims described in a separate letter or fax you received weeks earlier.

Or later! As a patient I've received both payments from insurance providers and overpayment reimbursements from medical providers before the explanation of what the check is for. Usually just a day or two if that, but if something gets missed and has to go through a reconciliation process I could easily see that EOB letter going out a month or more later.

It's corporations dealing with a private person though, they don't care.

Because the people with letter openers in the mail room aren’t accountants?

Right, they open the mail and give the check to the accountant, who deposited it.

And we still want to know why.

Cashflow and Revenue are two separate concepts.

You can cash a check today for revenue you accounted for 90 days ago.

You need to reconcile it but it doesn't have to happen at the same time. It's very normal to reconcile months later.

The minimum wage employee who stamps the check and deposits it at the bank with the hundred others in the pile isn't an accountant either.

The accountants just go "huh, this one doesn't match up with anything" later on.

> The minimum wage employee who stamps the check and deposits it at the bank with the hundred others in the pile isn't an accountant either.

That’s not how any of this works lol

It is exactly how all of this works

In Canada, one of the main players in the space is INTRIA

https://www.cibc.com/en/cibc-websites/intria.html

They have an office full of people processing cheques, cash etc etc. In the old world, all cheques were processed by hand but in the new world, all cheques are processed by a combination of electronic imaging and MICR: people only look at the ones where tech processes fails. Which are a lot of them.

This area of finance is called "Corporate Cash Management" - a bit of misnomer because it is not just cash and is primarily electronic these days. It is essentially about the processes that need to be in place to physically and electronically move money around.

Here are some examples of what the biggest bank in Canada offers in this space.

https://www.rbcroyalbank.com/business/paying-and-receiving/m...

The do not explicitly mention cheques because that space is really well automated these days but it is mostly done really well by technology and most banks are trying to move away to electronic payments. But if you ask for it, you will get it at specially quoted per customer rates.

Nice article on declining cheque usage in Canada: https://www.bankofcanadamuseum.ca/2023/09/a-checkup-on-chequ...

> That’s not how any of this works lol

How does it work?

Probably, they open the mail and send checks directly to the bank. Then the bank sends the deposit information to the accountants.

They certainly have all kind of strange things they must send to all kinds of people.