Uncashed checks, also called outstanding checks, are checks issued by the university that have not been cashed by the intended payee. If a check remains uncashed for 180 days or longer, it becomes stale and is referred to as a stale-dated check, and banks will decline the check if the payee tries to cash it. If the check remains uncashed for a period of time, it becomes unclaimed property, also known as escheatment.
Taking action to follow up on an uncashed check (to a supplier or a visiting speaker, for example) in a timely manner supports proper stewardship of Stanford’s funds, and decreases the time and effort needed to track and resolve stale checks.
For stale dated or misplaced payroll checks, submit a support request.
Checks processed by FMS’ Accounts Payable team include payments related to purchase requisitions, purchase orders, expense reimbursements, and non-PO payments.
A check may remain uncashed if the payee did not receive the payment (for example, the payee lost the check, the check may have been sent to an incorrect mailing address or it was lost in the mail), or if the payee has already been paid by a different method, such as an electronic funds transfer between banks via Automated Clearing House (ACH).
Departments should allow approximately 14 business days after the payment has been sent to reach out to a payee to follow up on the uncashed check. Departments that have confirmed they have an uncashed Accounts Payable (AP) check, or have been notified by AP about an uncashed check, can submit a support request and select one of the following options.
- If Stanford does not owe the payment to the payee, select Void and Do Not Reissue, and provide a reason for the void, to cancel the check and the invoice. Please note that canceling a check cannot be reversed.
- If the payee is owed this payment
- Select Void and Reissue with No Change to cancel and reissue the check to the same mailing address.
- Select Void and Reissue with Change to cancel and reissue the check to a new mailing address or other relevant information.
Each year, the university is required to identify checks issued that remain uncashed. The Office of the Treasurer partners with schools, departments, and affiliates to identify any unclaimed payments, such as checks issued to vendors, payments to human research subjects, and reimbursement checks, among others that have not been cashed or stored value card balances that remain unused.
If a department issued checks from a department checking account or issued stored value cards that may have balances that have not yet been turned over to the state, contact the Office of the Treasurer. For stale dated or misplaced payroll checks, submit a support request.
Due diligence process
If a check remains uncashed for a period of time, and the payment is valid, the university distributes due diligence letters to payees at their last known address as the uncashed check approaches the remittance deadlines established by their respective states.
The due diligence notice will include information such as the amount of the check, the check number, and instructions on how the payee can claim the funds. This letter serves as a final effort to encourage the recipient to confirm that the funds are not owed before the unclaimed property is remitted to the state.
The State of California, all other states, and the U.S. territories of Puerto Rico, Guam and the Virgin Islands, require that unclaimed property be turned over to the state if the property remains unclaimed, typically three years, though it varies by state and purpose of the check. This requirement applies to all checks issued by the university, including foreign checks.
Transition to unclaimed property (escheatment)
If the payee does not respond to the due diligence notice, the university must transfer the value of the check to the state, specifically to the State Controller’s Office, as unclaimed property. This process is also known as escheatment.
After the unclaimed funds are reported, the state becomes the custodian of the unclaimed property in perpetuity, and the original payee must file a claim to that state to retrieve their money.