An outstanding deposit is that amount of cash recorded by the receiving entity, but which has not yet been recorded by its bank. All outstanding deposits are listed as reconciling items on the periodic bank reconciliation prepared by the receiving entity. These deposits are subtracted from the book balance of the receiving entity to arrive at the bank balance.
For example, a company receives $1,000 on March 31, a Friday, and records it as having been received in March. The bank will record the receipt in the company's account the following Monday, April 3. The $1,000 is considered by the company to be an outstanding deposit until it is recorded by the bank on April 3.
Deposits are typically only outstanding for one business day, so there tend to be few of these deposits listed as reconciling items whenever a bank reconciliation is prepared.
An outstanding deposit is also known as a deposit in transit.