DoD Financial Management Regulation Volume 5, Chapter 14
ËMarch 2009
local financial institutions in the area to secure the most beneficial banking agreement.
1404 VOIDED AND SPOILED LIMITED DEPOSITARY CHECKS
140401. General. Treat original LD checks that are not to be issued as voided or
spoiled. The DO maintaining the LDA accounts for all LD checks. Void checks because of
errors in writing the check (e.g., wrong name, amount.), withdrawal of the voucher by the
applicable entitlement area, or because the check is physically damaged during preparation.
Mark these checks conspicuously to prevent their negotiation, either in error or through fraud.
Prepare separate listings of voided and spoiled checks monthly and attach them to the Statement
of Designated Depositary Account (SF 1149).
140402. Voided Checks
. The functional area authorizing the payment of a voucher
may request voiding of a check. The DO’s decision is based on the payee’s nonentitlement to
the payment, or an error in the way the check is drawn. Do not report voided checks as issued in
the DO’s check report. Upon determination to void a payment, render a check nonnegotiable by
stamping, marking or writing the words, “VOID - NOT NEGOTIABLE, NO CHECK ISSUED
UNDER THIS NUMBER” on the face of the check in large prominent letters. Do not store
voided checks in the safe or vault of the DO or any deputies or agents. Prepare a listing of
voided checks, entitled “Voided Checks,” showing the accounting month, the name of the LD,
and the LDA number at the end of each month and forward it with the monthly SF 1149. Include
the originals of all voided checks with the listing.
140403. Spoiled Checks
. A DO issuing a check determines when to report a check
as spoiled, basing this decision on the physical appearance of the check, e.g., mutilated, torn, not
whole, smudged, or unreadable; or upon the discovery of an error in the preparation of the check,
e.g., voucher correct but the check data does not match the voucher. Prepare a separate listing of
spoiled checks, entitled “Spoiled Checks,” in check-number sequence at the end of each month,
showing the accounting month, the name of the LD, and the LDA number. Send the listing and
the original spoiled checks with the monthly SF 1149. Replace a spoiled check with another
serially-numbered check, using the next available check. Except for the check serial number and
the check issue date, enter the same information that appeared on the original check. Date the
replacement check on its issue date. Render the original check nonnegotiable by writing,
marking, or stamping “SPOILED – NOT NEGOTIABLE, REPLACEMENT ISSUED UNDER
CHECK NO. DATED ____” on the face of the check. Inscribe “Issued to Replace Check
No.
” on every replacement check in the lower left-hand corner of the face of the check.
Show this same information on the detailed record of checks issued.
1405 TRANSFERRING PROCEEDS OF LIMITED DEPOSITARY CHECKS
140501. General
. Occurrences after a LD check has been issued may require
transferring the check proceeds to Treasury or the original appropriation. The most frequent
occurrence of transferring the proceeds of LD checks is when outstanding check amounts are
transferred to Treasury as uncurrent. An uncurrent LD check is one that has not been negotiated
through the LD one fiscal year after the fiscal year after its issuance. The transfer of LD check
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