Bank statement

Definition

A bank statement is an official document provided by a financial institution, such as a bank or credit union, that outlines the financial transactions and activities of an account over a specific period of time. It serves as a record of the account holder’s financial interactions, including deposits, withdrawals, transfers, and other relevant details.

What is a bank statement?

Here are the key components in bank statement:

1. Account information: A bank statement typically includes details about the account, such as the account holder’s name, account number, and the period covered by the statement.
2. Transaction history: It provides a comprehensive list of all financial transactions related to the account during the specified time period. 
3. Date of transactions: Each transaction is recorded with a date, allowing the account holder to track when specific activities occurred.
4. Description of transactions: Alongside each transaction, there’s typically a brief description or reference. This can include the payee’s name, deposit source, or a transaction code indicating its nature.
5. Interest and fees: Bank statements may also include information about interest earned on deposits or charged on loans, as well as any fees or charges associated with the account.
6. Overdrafts and insufficient funds: If there are instances of overdrafts or insufficient funds, they will be clearly indicated on the statement, along with any associated fees.

Bank statements are important documents for various financial and legal purposes. They can be used as proof of income, for tax reporting, in loan applications, and in legal proceedings.

Example of a bank statement

Account holder: John Doe
Account number: 123456789
Statement period: January 1, 2023, to January 31, 2023

Beginning balance: £5,000.00

——————————————————————–
Date                   Transaction Description               Amount
——————————————————————–
01/05/2023      Deposit – salary                       +£3,000.00
01/10/2023      ATM withdrawal                       -£200.00
01/15/2023      Debit card purchase               -£150.00
01/20/2023     Online transfer                         -£500.00
01/25/2023     Check #1234                            -£100.00
01/31/2023      Service charge                        -£5.00
——————————————————————-
Ending Balance: £7,045.00

Actual bank statements may include additional details, such as interest earned, fees, and other information specific to the account.