What are the Importance of Bank Statements?

Bank statements are statements which detail the transactions in the bank account of an individual or organization. They must be accurate and clear in order to be authentic and valuable. Bank statements can be requested by an individual or company from the bank or they may be released by the bank periodically as the situation demands it. Bank statements are issued for certain period of time, that is, they often display the transactions in a bank account for a month, or so. Bank statements can also cover the credit card transaction of an individual who possesses the credit card of a particular bank. Some of the important uses to which bank statements may be put to are as follows:

  • A bank statement is invaluable in clarifying the transaction details of a particular bank account. Since most bank statements are now computer generated, the accuracy, speed and accessibility of these statements have increased manifold.
  • A bank statement can also be used in case of any misunderstanding or financial mismanagement. It serves as documentary evidence in such cases and is usually given great weight in clearing cases.
  • A bank statement alludes to the financial status of a company or an individual. It is often used to judge an individual or a company’s worth or standing as well as for purposes of business. It is an indicator of a company’s suitability in many cases.
  • A bank statement which is issued periodically is very useful for keeping track of an account. It is imperative that for the purpose of financial management and order, a bank statement is inevitable and useful.

Thus the importance of a bank statement cannot be overemphasized. In maintaining transparency and smooth transactions, a bank statement’s contribution is invaluable. It must be prepared with the utmost effort and verified before being issued or circulated.

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