Figure 44

STATEMENT

 

Rather than requiring immediate payment of invoices, suppliers may offer credit in the form of open account facilities for an agreed period of time, usually a month but sometimes a quarter (three months). At the end of the period a statement of account is sent to the customer, giving details of all the transactions between the buyer and seller for that period. The statement includes the balance on the account, which is brought forward from the previous period and listed as account rendered. Invoices and debit notes are added, while payments and credit notes are deducted.

Statements of account rarely have letters with them unless there is a particular point that the supplier wants to make, e.g. that the account is overdue, or that some special concession is available for prompt payment, but a compliments slip may be attached.

Note the expression as at (e.g. as at 31 March), which means up to this date.

Figure 45