Suspense account clearance is the process of resolving the entries that have been posted temporarily to a suspense account because their correct destination was not known at the time. Typical items are receipts with no identifiable payer or invoice, payments rejected or returned, differences thrown up by system interfaces, and one side of an entry that could not be completed. Clearing an item means finding out what it is, obtaining any missing information, and transferring it by journal to the proper customer, supplier, income or expense account.
Finance and operations teams review the account daily or weekly and aim to bring it to nil, or to a short list of explained items, before each general ledger close. Controls include a named owner for each account, an ageing report with escalation of old items, journal entry approval for clearing entries, and a regular account reconciliation. Uncleared balances can hide errors or fraud, so auditors examine them closely.