Canceling Checks 
You can cancel a check that was received as an incoming payment together with the incoming payment document, whether the check is deposited or not.
To view the status of a check, select the check in the Check Register window, and select the Check Status tab.
Procedure
Non-Deposited Check Cancellation
To cancel non-deposited checks, follow the procedure below:
From the SAP Business One Main Menu, choose
Banking 
Incoming Payments Check Register 
.In the Check Register – Selection Criteria window, specify the required parameters and choose OK.
In the table, right-click the check you want to cancel, and choose Cancel Check.
When asked whether to cancel the check, choose Yes to complete the cancellation.
NoteIf the current system date is not the original document date, the Cancellation Options window appears.
Select one of the following:
Current System Date – to assign to the transaction resulting from the cancellation the current date
Original Document Date – to assign to the transaction resulting from the cancellation the same date (posting date, due date, and document date) as is assigned to the canceled document
Choose OK to complete the cancellation.
End of the note.
Deposited Check Cancellation
To cancel deposited checks, follow the procedure below:
Note
You cannot cancel checks that are deposited through the Postdated Check Deposit window.
From the SAP Business One Main Menu, choose
Banking Incoming Payments Check Register .In the Check Register – Selection Criteria window, specify the required parameters and choose OK.
In the table, right-click the check you want to cancel, and choose Cancel Deposit and Payment.
When asked whether to cancel the check, choose Yes to complete the cancellation.
NoteIf the current system date is not the original document date, the Cancellation Options window appears.
Select one of the following:
Current System Date – to assign to the transaction resulting from the cancellation the current date
Original Document Date – to assign to the transaction resulting from the cancellation the same date (posting date, due date, and document date) as is assigned to the canceled document.
Choose OK to complete the cancellation.
End of the note.
Result
A reverse journal entry is created in order to cancel the journal entry created when the incoming payment was added. The date assigned to this transaction is according to the selection you made in the Cancellation Options window. The Remarks field of this journal entry indicates that this is a reverse transaction for a specific incoming payment.
If the check is the only payment means related to the incoming payment, the Journal Remarks field in the related incoming payment displays the text: Canceled.
For deposited check cancellation, a reverse deposit document of negative amount is created. The date assigned to this deposit is according to the selection you made in the Cancellation Options window. It contains only the check you have chosen to cancel.
For deposited check cancellation, in the deposit document in which the check is canceled, the Canceled column for the canceled check displays the text: Yes.