A cheque is an important document that an individual, companies, governments and many others use to transact their business. By definition, a cheque can be termed as a negotiable document to transfer money either in physical form or to effect inters account transfer.
Cheques are a form of payment that is recorded by accountants on your receivables ledger. While you may record the payment instantly upon receipt, there will be a lag time between when you record the payment and when the check clears the bank and is posted to your account.
Unless or otherwise stated, a cheque is a signed unconditional order addressing the bank to credit it by the issuer. The issuer of the cheque will have an account with the bank to which it is connected. The account can be either savings type or a current account. A cheque transaction is one of the safest ways of conducting the business because it leaves an entry against the cheque honored by the bank in the banking transactions conducted by you which can be traced back in case of necessity.
A cheque is a vital negotiable tool which can be transferred by simple hand delivery. It is used to craft secure and suitable payment. It is less risky and the hazard of loss is reduced. It is a document in writing drawn upon a particular banker to pay a particular amount to the person named in it and payable on demand.