The concept of forgiveness actually originates in the financial world. Forgiveness occurs when a debt is cancelled by the lender, with the result that the borrower is no longer required to repay the debt. The primary usage of forgiveness in the Bible is as a description of what God does for us. Because of our sin, it is as if we owe Him a debt that we are unable to repay. Because Jesus paid the debt for all sin by His crucifixion, God forgives that debt to all who trust in Jesus.
Accordingly, when a person sins against us, it is as if they are indebted to us. When we forgive, we are forfeiting our right to claim payment for that debt. By forgiving, we release our claim to repayment or revenge against the person who wronged us, and leave the matter to be dealt with between them and God.
Our society often combines the acts of forgiving a sin and forgetting it. However, to the best of my knowledge, Scripture never commands Christians to forget their neighbors’ sins--only to forgive them. Our minds simply aren't capable of forgetting something at will, especially in cases where that event has been traumatic or highly stressful. Additionally, there are many instances where forgetting a particular sin could be quite dangerous, because it would leave a person at risk for loss or injury. (for example, an abusive spouse or a dishonest employee).
Additionally, our society also tends to combine the concepts of forgiveness and reconciliation, while this is not always the case in Scripture. When we forgive, we give up our right to repay a sin or take revenge for it, but it does not always mean that the relationship becomes completely reconciled to its former state. For example, it may be necessary for a wife not to reconcile with an abusive husband for the sake of her children, even though she forgives his sin against her. Or it may be completely appropriate for an employer to terminate a dishonest worker, even though he forgives the sin of theft.
Likewise, forgiveness does not mean that one gives up legal recourse against the person. For the safety of our neighbors and society, someone such as a victim of assault should not hesitate to testify against her attacker in court, even after she has forgiven his sin.
In light of these things, it is not necessary that a person be present in order to forgive them. If you have abandoned the desire to repay that sin or to seek revenge and have left it to be judged against that person by God, you have done what is necessary to forgive them. It is certainly good when forgiveness can be expressed verbally to the other party, but when that is not possible, forgiveness can occur anyway.
The same idea would apply for forgiving a person who has died. Even if we failed to forgive them during their physical life, their eternal condition is determined by their trust in Jesus (or lack thereof), and not by whether those they wronged in their life have forgiven them.
Our own spiritual condition is similarly determined, not by our own actions (even the action of forgiving others), but based on whether or not we trust Jesus to forgive our sins. Our forgiveness of others is not the cause of God's forgiving us. Instead, Christians forgive others as a result of having first received forgiveness from God. Even if our forgiveness is imperfect, we rely on His actions, and not our own as the bases for our salvation, and we daily seek to live our lives in light of that forgiveness, which includes our desire and effort to forgive those who have sinned against us.