What Is a Statement of Account and Why Use One?

Learn what a statement of account is, what it includes, how it differs from invoices, and why businesses benefit from issuing them.

Statement of Accounts: Meaning, Purpose and Benefits

A statement of account is a financial document summarising the transactions between a business and a customer over a specific period. It’s commonly used in business-to-business (B2B) settings to keep track of outstanding balances and encourage timely payments. While not a legal requirement in most cases, statements of account are a key part of professional credit control and account reconciliation.

What Is the Statement of Account?

A statement of account is a running summary of a customer’s account with your business. It lists invoices issued, credit notes applied, payments received, and the remaining balance due. It’s typically issued monthly, showing all activity during that period.

A Statement of Accounts (capitalised) may also refer more broadly to a formal set of statutory financial statements filed by limited companies in the UK. This includes the balance sheet, profit and loss account, and notes to the accounts submitted to Companies House.

So while the terms sound similar, one refers to customer transaction summaries, and the other to full company accounts filed annually.

What Is Its Purpose?

The purpose of a statement of account is to:

  • Remind customers of outstanding invoices

  • Provide a record of account activity

  • Help both parties reconcile their books

  • Maintain transparency and reduce disputes

  • Act as a soft prompt for overdue payments

Statements of account are particularly useful for companies that invoice regularly or operate on credit terms. They offer a consolidated view, rather than sending reminders for individual invoices.

What Is the Content of the Statement of Account?

A standard statement of account includes:

  • Customer name and address

  • Your business details and contact info

  • Statement date and period covered

  • Invoice numbers and dates

  • Credit notes (if any)

  • Payments received (with dates and references)

  • Running balances

  • Total outstanding balance at the bottom

Some statements may also include due dates, terms, or a note about interest charges for overdue accounts.

What Is the Difference Between the Statement of Accounts and a Statement of Account?

The Statement of Accounts (plural, capitalised) typically refers to the formal financial statements of a company—required for statutory reporting. These are filed with Companies House annually and include the balance sheet, income statement, and supporting notes.

A statement of account (singular, lowercase) is a customer-facing document used in routine business operations to show what they owe. It’s internal to trading relationships and isn’t a public record or legal filing.

Is a Statement of Account Different From an Invoice?

Yes. An invoice is a single request for payment for a specific sale. A statement of account, on the other hand, summarises multiple invoices and payments over a time period. While an invoice tells the customer how much is due for a particular transaction, the statement tells them what they owe in total and how their payments have been applied.

A statement may include a list of several invoices, some paid and some unpaid. It helps the customer see the full picture.

Example of a Statement of Account

Here’s a simplified example:

Statement of Account
Customer: XYZ Ltd
Statement Period: 1 March – 31 March 2024

01/03/24

  • Invoice No.: INV001

  • Description: Website Design

  • Amount: £1,000.00

  • Payment: –

  • Balance: £1,000.00

  • 10/03/24

    • Description: Payment Received

    • Amount: –

    • Payment: £1,000.00

    • Balance: £0.00

  • 15/03/24

    • Invoice No.: INV002

    • Description: Hosting (Annual)

    • Amount: £600.00

    • Payment: –

    • Balance: £600.00

  • 28/03/24

    • Invoice No.: INV003

    • Description: Support Retainer

    • Amount: £300.00

    • Payment: –

    • Balance: £900.00

Outstanding Balance: £900.00

Should Every Company Give a Statement of Account?

Not every company must, but it’s strongly recommended for those offering credit terms or managing multiple invoices per customer. Statements reduce missed payments, clarify accounts, and improve client communication.

For small businesses, sending a monthly statement shows professionalism and encourages timely payment. Even if you issue invoices, a statement helps consolidate everything into a single document for easier client reconciliation.

What Are the Benefits of a Statement of Accounts?

Issuing regular statements offers several key benefits:

  • Speeds up payment by reminding customers what they owe

  • Reduces disputes by providing a clear audit trail

  • Makes credit control more efficient and structured

  • Encourages regular communication between accounts teams

  • Builds trust through transparency and professionalism

  • Simplifies account reconciliation for both sender and recipient

By helping customers stay organised, statements also make it easier for you to forecast incoming cash and spot late payers early.

Conclusion

A statement of account is a simple yet powerful tool for keeping customer balances clear and ensuring smooth credit control. It’s not a substitute for invoices, but it pulls everything together in one view, making it easier for both parties to stay on the same page. For companies issuing multiple invoices or offering payment terms, sending regular statements can significantly reduce delays and improve cash flow.