Glossary
What is a statement of account?
A statement of account lists every invoice, payment and credit between you and a customer over a period. See what it includes and a worked example.
Updated · By PayToMe Editorial
A statement of account is a document that summarizes all transactions between a business and one customer over a set period. It lists invoices, payments, credits and adjustments, and ends with the balance the customer owes. It is a summary, not a request for a single job.
How it works
Where an invoice covers one sale, a statement shows the whole relationship. It starts with an opening balance, adds each new invoice, subtracts payments and credits, and arrives at a closing balance. The customer can compare it with their own records and spot a missed payment or a duplicate charge.
A useful statement includes:
- Your business name and the customer’s name and account number.
- The statement period, such as October 1 to October 31.
- The opening balance carried from the last statement.
- Each transaction with its date, reference number and amount.
- The closing balance and the due date.
- How to pay, and who to contact about differences.
Statements help in three situations. First, customers with many invoices often prefer one monthly payment against a statement. Second, a statement is a gentle way to chase overdue amounts, since it shows what is outstanding without sounding accusatory. Third, it speeds up reconciliation when the customer’s accounts payable team says their numbers differ from yours.
Internally, the list of balances you hold across all customers is your accounts receivable, and the aging report groups them by how late they are. A statement is the customer-facing slice of that data.
Example
A print shop supplies a restaurant. Here is a sample statement for October.
The restaurant sees that the opening $450.00 was paid, and the remaining $555.00 is made up of two invoices less one credit. To keep your own invoices tidy, use the invoice generator. PayToMe is in public beta and you can sign in to PayToMe to send invoices today. Smart reminders are in development, and you stay in control of what is sent.
Related terms
- Accounts receivable: the money customers owe you, in total.
- Aging report: an internal view of overdue balances.
- Remittance advice: the customer’s note about what a payment covers.
- Credit memo: a credit that appears on the statement.