Statement of Account
A Statement of Account is a detailed report or record prepared by a supplier or service provider which lists all the transactions that have taken place between the supplier and the customer over a specified period. It’s typically used to show the balance of what’s still owed by the customer (or sometimes, what’s owed to the customer in cases of overpayments).
Key features of a Statement of Account include:
- Header Information: The name and contact details of the supplier, the name and address of the customer, the statement date, and any relevant statement number or reference ID.
- Opening Balance: The amount due at the beginning of the statement period. This is usually the ending balance from the last statement.
- List of Transactions: This typically includes:
- Closing Balance: The total amount still owed by the customer at the end of the statement period. It’s computed by adding all the debits, subtracting all the credits, and then adding/subtracting this net amount to/from the opening balance.
- Duration: The statement covers a specific period, like a month or a quarter.
- Payment Terms: Any information regarding due dates for the outstanding balance, interest charges for late payment, or benefits for early payment may also be included.
Example of a Statement of Account
Let’s delve into a more detailed fictional example of a Statement of Account.
Statement of Account
Supplier:
Golden Electronics
123 Tech Avenue, Electron City, EC 12345
Phone: (123) 456-7890
Email: support@goldenelectronics.com
Customer:
Bright Innovations
456 Startup Blvd, Innovate Town, IT 65432
Statement Date: July 31, 2023
Statement Period: July 1, 2023, to July 31, 2023
Opening Balance (as of July 1, 2023): $2,000.00
Transaction Details:
| Date | Description | Invoice/Receipt No. | Debit ($) | Credit ($) |
|---|---|---|---|---|
| July 5 | Purchase – Laptop | INV-0723-01 | $1,200.00 | – |
| July 10 | Purchase – Tablet | INV-0723-02 | $500.00 | – |
| July 15 | Payment Received | REC-0723-15 | – | $1,500.00 |
| July 20 | Purchase – Router | INV-0723-03 | $300.00 | – |
| July 24 | Payment Received | REC-0723-24 | – | $1,000.00 |
| July 28 | Purchase – Mouse | INV-0723-04 | $50.00 | – |
Closing Balance (as of July 31, 2023): $1,550.00
(Opening Balance + Total Debits – Total Credits)
Payment Due Date: August 15, 2023
Notes:
Any payments made after the statement date will reflect in the next statement. Please reference invoice or receipt numbers when making payments or inquiries.
In this example:
- Bright Innovations began July with an amount due of $2,000 to Golden Electronics.
- Over the month, Bright Innovations made purchases that totaled $2,050 (sum of all the debits).
- They also made payments amounting to $2,500 (sum of all the credits).
- By the end of July, Bright Innovations owes Golden Electronics a total of $1,550.
This Statement of Account gives a clear and organized view of all the transactions between Bright Innovations and Golden Electronics for the month of July. Bright Innovations can use this to reconcile its records, understand its outstanding balance, and make necessary payments by the due date.
