Part 8
Collected & Withdrawn Cheques and Auditing of Bank's Account

a- Collected Cheques:

Article (120)

The cheque shall be accepted, irrespective of the value thereof, if the drawer is a governmental department, municipality or a public shareholding company.

Article (121)

The cheque with an amount not exceeding (1000) Dinars shall be accepted without being certified by the drawee bank. Uncertified or non-banking multiple cheques from one payer shall not be accepted if the total thereof exceeds (1000) Dinars.

- This Article has become in this manner after its ex provisions were superseded by the current provisions pursuant to Instructions No. (1) for the year 1998, as amended. The ex provisions have stipulated as follows: "The cheque with an amount not exceeding (1000) Dinars shall be accepted without being certified by the drawee bank and the uncertified multiple cheques from one payer shall not be accepted if the total thereof exceeds (1000) Dinars."

Article (122)

The cheque withdrawn by individuals or parties other than those mentioned in Article (120) shall not be accepted if the value thereof exceeds (1000) Dinars unless it is a banking cheque or it is certified by the drawee bank. The employee shall assume the penal and civil liability if he violates same upon returning of the cheque.

- This Article has become in this manner after its ex provisions were superseded by the current provisions pursuant to Instructions No. (1) for the year 1998, as amended. The ex provisions have stipulated as follows: "The cheque withdrawn by individuals or parties other than those mentioned in Article (120) shall not be accepted if the value thereof exceeds (1000) Dinars unless it is certified by the drawee bank. The employee shall assume the penal and civil liability if he violates same upon returning of the cheque."

Article (123)

The cashiers and the persons authorized to receive the public funds should audit the cheques prior to receiving same, ensure that they fulfill the required conditions and write down the drawer's address as a precautionary measure in order to reclaim him when necessary.


Article (124)

Uncertified cheque or non-banking cheque shall not be accepted from any payer whose cheque or cheques were previously returned to him for not being cashed.

- This Article has become in this manner after its ex provisions were superseded by the current provisions pursuant to Instructions No. (1) for the year 1998, as amended. The ex provisions have stipulated as follows: "Uncertified cheques shall not be accepted from any payer whose cheque or cheques were previously returned to him for not being cashed."

Article (125)

If a cheque is returned due the non-payment whether due to non- sufficient provision or for refraining from paying it for any reason, it shall be debited to the account of the payer who paid it and shall be sent to the Department which has accepted it. Such Department should call the drawer and request him to pay the cheque's value within one week from the date of forwarding it thereto. If payment is not made, it should be collected according to the laws in force. In all cases, if the drawer of the bounced cheque has obtained a legal discount or no legal fine has been imposed thereon due to giving the cheque, this shall be considered as if it has never happened and the funds shall be collected pursuant to legal procedures including taking penal measures.

Article (126)

A special register for the bounced cheques shall be opened in a manner that would show all the information written on cheques such as a cheque's value, number and date, drawee bank, drawer and the purpose for which it has been collected and the name of Department that has accepted it.

Article (127)

Upon paying the value of a bounced cheque, it shall be recorded in the registers in a reversal manner to the previous entries in order to reflect the discharge of the payer.

b- Withdrawn Cheques:


Article (128)

Public funds shall be paid from the Treasury vide cheques drawn on the approved bank according to the rules determined by issue procedures.

Article (129)

A cheque drawn on a bank shall be recorded in a special register in a manner that shall show the method of delivering the cheque to the beneficiary, provided that the cheque's number, date and value, name of beneficiary, name of the cheque's receiver in three syllables and means of identification shall be stated.


Article (130)

A drawn cheque shall be delivered to the beneficiary by one of the following methods:

1. To deliver the cheque to the beneficiary or to whomever he authorizes in writing to receive it.

2. To deliver the cheque to the person authorized to receive same vide a written authorization from the beneficiary. The cheque shall be crossed by the following phrase: "To be paid to the first beneficiary".

3. To send the cheque by registered post to the address of the beneficiary whereas the cheque shall be crossed by the following phrase: "To be paid to the first beneficiary".

Article (131)

1. The value of a cheque, that could not be delivered to the beneficiary within six months from the date of its withdrawal for any reason, shall be collected and recorded as a trust in the name of the beneficiary in trusts register.

2. The value of the cheque, that has been delivered to the beneficiary but not presented for collecting the value thereof after six months from the date of its withdrawal, shall be collected and recorded as a trust in the name of the beneficiary after notifying the drawee bank not to pay it and return same to the drawer Department if presented for payment.

Article (132)

In the event that a drawn cheque is lost and the drawer Department is notified thereof, the Department shall carry out the following:

1. To put out a circular on the lost drawn cheque through the administration of the drawee bank or the Central Bank requesting its non-payment if presented for payment, and to return thereof to the drawer Department, mentioning the name of the bank, drawee's account number, the cheque's number, date and value and the name of the beneficiary and that the cheque shall be considered cancelled.

2. To issue another cheque instead thereof (in lieu of the lost) after the expiry of not less than one month from the date of requesting the bank to put out a circular on the cheque, provided that the last statement of the bank's account is received by the Department and to ensure that it is still suspended.

3. To record the cheque drawn in lieu of the lost one in the general journal as well as in the bank account book at the Department stating all information on the cheque except the value, which should be left blank. In their description fields, the following should be written: "Instead of the lost cheque No. (-----------), date (--------------)".

4. To write down in the description fields of the general journal and the bank account book, opposite to the lost cheque, the following: ''Cheque number (----------), date (---------------) is issued instead thereof."

5. Upon stating the value of the drawn cheque (in lieu of the lost one) in the bank's statement, the value thereof shall be crossed out from the statement against deleting the value of the lost cheque, which was issued as a substitute thereof.

c- Bank Account Auditing (Bank Settlement Memorandum):

Article (133)

Auditing of the bank account shall be vested in an employee other than the cashier who shall carry out his work in the following manner:

1. Upon receiving the bank's statement at the end of each agreed upon period, the competent employee (bank account auditor) shall reconcile the sums stated therein with the amounts recorded in the bank account in the general journal at the Department as follows:

   1. To reconcile the sums appearing in the credit side in the bank's statement with the sums recorded in the debit side in the bank account book at the Department (the bank account of the general journal) and previous suspensions.

   2. To reconcile the sums appearing in the debit side of the bank's statement with the sums recorded in the credit side in the bank account book at the Department and previous suspensions.

   3. The reconciliation shall be done by placing a distinctive sign on the reciprocal sums in each of the bank's statement and the bank account book at the Department.

2. Upon the completion of the reconciliation process at the end of each month, the bank account auditor shall prepare statements in the sums which have no contra in the following manner:

   1. Sums appeared in the bank's statement but having no contra in the bank account book at the Department, namely:

      1. Sums recorded in the bank for the Department's account as a deposit, but are not recorded in the bank account book at the Department.

      2. Sums paid from the bank against the Department's account but are not recorded in the bank account book at the Department.

   2. Sums recorded in the Department's books but having no contra in the bank's statement, namely:

      1. Sums recorded in the bank account book at the Department as withdrawals, but did not appear in the bank's statement (withdrawn cheques which have not been submitted to the bank for cashing).

      2. Sums recorded in the bank account book at the Department but did not appear in the bank's statement.

Article (134)

The bank settlement memorandum represents an equal two-side accounting statement. The right side of which includes the book balance of the bank's account at the end of the period (out of the general ledger) plus the value of the total withdrawn cheques by the Department but have not been submitted to the bank for cashing (suspended cheques) plus the total sums recorded in the bank to the credit of the Department account and are not recorded in the bank account book at the Department. The left side, on the other hand, includes the bank balance at the end of the period plus the value of the sums paid from the bank against the Department's account and are not recorded in the bank account book at the Department plus the sums recorded in the bank account book at the Department but have not appeared in the bank's statement. This should be prepared according to the established form which represents the following formula:

Article (135)

The succession of suspensions mentioned in Article (133/b) for the purposes of settling same during the subsequent month, shall be as follows:

1. To refer to the principal of each sum recorded in the Department's books but are not recorded in the bank's books from the Department's files and records. The bank shall be contacted to investigate the reason for the non-recording thereof in due course and to ascertain that it has been recorded in the bank's books at the subsequent period.

2. As to the sums recorded in the bank's books and are not recorded in the Department's books, the bank shall be contacted over all the information appearing in the bank's statement concerning such suspensions so that the bank shall refer to the principal of each sum and shall provide the Department with sufficient particulars and documents pertaining to these records in order to make the accounting entries thereon at the Department.

3. If it is discovered that one of the suspended entries, whether in the general journal at the Department or in the bank's statement, has resulted from an error, the entry in the same book in which the error occurred should be reversed.