What is a Statement of Account and how to read it? (2024)

FAQs

How do I read statement of account? ›

To understand your bank statement, review key sections: Bank Information (bank's name, address, contact info), Account Information (your name, address, account number), Statement Period (start and end dates of transactions), Opening/Closing Balance (account activity summary), Deposits (money added to your account), ...

A statement of accounts is a document that reflects all transactions that took place between you and a particular customer for a given period of time. Generally business owners send statements of accounts to their customers to let them know how much they owe for sales that took place on credit during that period.

Statement of account templates usually adhere to the following format: The name, address, and contact information of the company or individual who issued the invoice. The date on which the invoice was issued. A list of all items included in the invoice, along with their prices.

An account statement is a periodic summary of account activity with a beginning date and an ending date. An itemized statement is a document issued by a financial institution to its customers detailing all account activity for a specific period.

Name and Address. Top Half – On the top half of the statement the customer's full business name and address needs to be included, as well as yours, the seller, with contact numbers. Bottom Half – Complete your business name and address on the remittance, and your customers name on the right.

A statement of account: Lists all previous invoice amounts, with invoice numbers and dates, as individual line items. Lists all the transactions that took place in a defined period. Payments or credits are laid out as individual line items.

Account statements provide a comprehensive overview of transactions, balances, and activities in a bank, financial, or other account. They include details such as deposits, withdrawals, interest earned, fees charged, and the current balance (if applicable).

Summary. An account statement is a summary of account activity over the current period which can be a month, quarter, year, or other defined period. The account statement shows a summary of invoices sent, payments received, and other fees associated with maintaining the account.

It's divided into two sides — assets are on the left side, and total liabilities and equity are on the right side. As the name implies, the balance sheet should always balance. The assets on the left will equal the liabilities and equity on the right.

How to check statement of account? ›

You can check your bank statement through your bank's Net Banking portal or mobile banking app. These platforms allow you to keep tab on your account balances at any time. Accessing your bank statement online gives you real-time updates, enables monitoring, helps detect errors, and facilitates financial planning.

Breaking Down a Bank Statement

The closing balance is calculated as Opening Balance + Deposits – Withdrawals. Below the account summary, the bank statement shows every transaction the account holder engaged in, along with the corresponding payees, dates, and amounts of the transactions.

Your bank statement reveals much private information you do not want others to know, such as your income, spending habits, financial position and investment details. If you don't redact this information from your bank statement before sharing it, it can be used against you.

The income statement, balance sheet, and statement of cash flows are required financial statements.

The balance sheet is broken into two main areas. Assets are on the top or left, and below them or to the right are the company's liabilities and shareholders' equity. A balance sheet is also always in balance, where the value of the assets equals the combined value of the liabilities and shareholders' equity.

A personal financial statement shows the individual's net worth—their assets minus their liabilities—which reflects what that person has in cash if they sell all their assets and pay off all their debts. If their liabilities are greater than their assets, the financial statement indicates a negative net worth.

You'll find records of all transactions—both incoming and outgoing—so you know exactly what was going on with your funds during that period. Bank statements are an essential resource for account holders to track their funds, review spending habits, and flag fraudulent transactions or potential payment errors.