Banking Category Banking: the easy, simple banking guide

Difference between an invoice & a statement

In everyday language, the words "invoice" and "statement" are often used interchangeably. Many times this is correct. An invoice is a type of statement, but a statement is not always an invoice. There are dozens of examples where a business document can serve as a combined invoice and a statement of account.


A simple definition for invoice can be a "request for payment." In this instance it means a bill, or statement of money owed. An invoice will show charges for services provided or goods purchased. A 'paid invoice" can be used as a proof of purchase or partial statement of account. A statement, as a business document, means a report. Often a statement will report credits and debits in an account along with a request for payment, in which case it doubles as an invoice.


Examples of invoices that are simple bills the average American consumer receives on a regular basis are an invoice for electric service, i.e., the electric bill, invoices for water and sewer, trash bill, cable TV bill, phone, Internet, laundry, dry cleaning and so forth. Examples of commonly used statements that are simple reports, or "statements of accounts," that do not normally include a request for payment, are bank statements and brokerage account and insurance statements. A combination invoice/statement example that most consumers are familiar with is the monthly credit card statement.


Statements like those sent from banks to account holders function as an ongoing record of debit and credit transactions in one particular account. For instance, if a consumer holds a current account, savings account, and one or more CDs (certificate of deposit) with one financial institution, the common procedure is for the bank to issue regularly scheduled reports (statements of account) on each account separately to the account holder. None of these examples are invoices because they do not request payment.


In comparing a simple invoice and a simple statement, the difference can be distinguished more easily. A common invoice for electric service will show previous and present meter readings, kilowatt hours used, the service address where the electric was used, billing address, billing date, amount owed and date due, among various other miscellaneous taxes, charges and personal information. A simple current account statement from a bank will show a beginning and ending balance for the period reported and all deposit and withdrawal transactions that have occurred during the reported period.


Unfamiliar statements can be misleading as to whether or not the sender is requesting payment. One example is a statement for medical services provided. The report may list itemised charges for services rendered and supplies, along with provider charges billed. It may state that these charges are pending insurance approval. In which case, the business is simply letting the consumer know the amounts being requested from an insurance provider. Or a statement of itemised charges may be received with the words "This is not a bill" in prominent lettering. If the consumer is uncertain as to which they have received, a statement or a statement as an invoice, contacting the sender directly is a means to clarify the matter.