Standing order
What is a standing order?
A standing order is a regular payment out of a bank account.
The payer tells its own bank to pay a fixed amount on fixed dates. Only the payer can change it.
It suits an amount that stays the same.
Example
A shop pays its landlord £650.00 on the first of every month by standing order. Over 12 months that is £7,800.00, in 12 payments that each have to be entered in the cash book.
Why it matters
No document arrives on the day it is paid. The bookkeeper still has to enter it in the cash book, from a list of regular payments or from the bank statement.
Practise it
Practise it nowStanding order or direct debit
Ledger Drill is practice, not tax or accounting advice. If this looks wrong, tell us at [email protected].