Legal Definitions - account statement

An account statement, also known as a statement of account, is a formal document provided by an organization (such as a bank, credit card company, or utility provider) to an individual or entity that holds an account with them. This document summarizes all financial transactions that occurred within a specific period, typically a month or a quarter. It details the opening balance, any deposits or credits, any withdrawals or debits, and the resulting closing balance for that period. The primary purpose of an account statement is to inform the account holder about their account activity, current status, and any outstanding obligations or available funds.

Here are some examples illustrating an account statement:

• Personal Checking Account: Imagine receiving a document from your bank at the beginning of each month. This document lists your checking account balance on the first day of the previous month, followed by every deposit you made, every check you wrote, every debit card purchase, and any ATM withdrawals. It then shows your final balance at the end of that month.

  This document is an account statement because it provides a comprehensive record of all financial movements in your checking account over a defined period (one month), allowing you to track your money and verify transactions.

• Credit Card Account: When you use a credit card, you receive a monthly bill that itemizes all your purchases, any payments you made, interest charges, and fees. It also clearly states your previous balance, your new balance, the minimum payment due, and the payment due date.

  This monthly bill serves as an account statement because it details all financial activity on your credit card account for a specific billing cycle, showing how your balance changed due to spending, payments, and charges.

• Investment Brokerage Account: A brokerage firm sends its clients a quarterly report showing all the stocks or funds bought and sold, any dividends received, and the overall performance and value of their investment portfolio during that three-month period. It also shows the starting and ending value of their investments.

  This quarterly report is an account statement as it summarizes all transactions and changes in value within an investment account over a specific quarter, providing the investor with a clear overview of their portfolio's activity and status.