A statement of account is a report sent to your customers to show how much money they owe. It is a list of all the invoices and credit notes that are outstanding. An invoice is issued to a client when goods or services are sold on credit.
The report will show the following information, invoice date, reference number, details and amount due. The amount outstanding may also be split between current invoices (not due for payment), 30-60 days overdue, 60-90 days overdue and 90 days and over.
It is important to ensure that you put on all your contact details, so if they have a problem, they know where to get in touch. Include the Business name, address, telephone number, email address and any other contact details that you may have.
A customer will use a statement to check that the invoices and credit notes they have on their accounting system match the details on the report.
When to send out a Customer Statement
Issuing statements of account should be completed at least once a month. A good time to send them out is at month end, but if you know when a customer has a payment run it is worth sending it out before the run so that they can check their records.
Some businesses will only pay their account after they have received a statement, which can be a delay tactic to make payment, but also ensures their records are correct and they do not have to issue a second payment for missing invoices.
Statement of Account Template
If you are using an accounting software package like QuickBooks, Xero or Sage, the report will be available within the software. It is possible to email it directly from the software to the client, to save time and postage.
If you are using a manual system, we have created a statement of account template which is free to download.
Features of our template:
- Brand with your own logo
- Enter all your business contact information
- List all invoices and credit notes outstanding
- Automatically totals amount outstanding
- If customer ticks invoice paid it will total amount up
- Remittance advice
Most Statements include a remittance advice. It can be detached and sent back with payment. It is an easy way of advising which invoices are paid.
If payment is very overdue and you have tried to contact the customer, provided a statement of account and a letter, the next step is to issue a 7-day debt collection letter. Attach a copy of their statement to the letter, or list the invoices and credit notes in the letter. It will make sure that they have all the details.