Which of the following statements about convenience checks is correct?

Which of the following statements about convenience checks is correct?

• A. Funds must be available to cover the check value and the bank's processing fee
• B. Checks do not need to be secured
• C. The Cardholder cannot stop payment on a check
• D. Checks can be cashed regardless of available funds

Answer: (A)

The statement that funds must be available to cover the check value and the bank's processing fee is accurate because it reflects the essential principle of responsible financial management when using convenience checks as part of the Governmentwide Commercial Purchase Card (GPC) program. When issuing a convenience check, the account must have sufficient funds not only to cover the amount of the check itself but also any additional fees charged by the bank for processing that check. This ensures that the transaction remains within the guidelines set forth for the GPC program and helps to prevent any overdrafts or associated penalties that can arise from insufficient funds. This necessity promotes fiscal responsibility and accountability among cardholders, aligning with the overarching goals of the GPC program to utilize funds efficiently and in compliance with regulatory requirements. Ensuring funds are available safeguards both the agency and cardholder from potential financial mismanagement.

The statement that funds must be available to cover the check value and the bank's processing fee is accurate because it reflects the essential principle of responsible financial management when using convenience checks as part of the Governmentwide Commercial Purchase Card (GPC) program. When issuing a convenience check, the account must have sufficient funds not only to cover the amount of the check itself but also any additional fees charged by the bank for processing that check. This ensures that the transaction remains within the guidelines set forth for the GPC program and helps to prevent any overdrafts or associated penalties that can arise from insufficient funds.

This necessity promotes fiscal responsibility and accountability among cardholders, aligning with the overarching goals of the GPC program to utilize funds efficiently and in compliance with regulatory requirements. Ensuring funds are available safeguards both the agency and cardholder from potential financial mismanagement.