Understanding Statements & Transactions

Making sense of your financial records in the digital age

The Anatomy of a Financial Statement

Financial statements provide a comprehensive record of your account activity. Understanding how to read these documents helps you maintain awareness of your financial situation, identify errors or fraudulent transactions, and track your spending patterns over time.

Account Summary

This section provides an overview of your account status, typically including:

  • Beginning balance: Your account balance at the start of the statement period
  • Ending balance: Your account balance at the end of the statement period
  • Deposits/credits: Money added to your account during the period
  • Withdrawals/debits: Money taken from your account during the period
  • Interest earned: For interest-bearing accounts
  • Fees charged: Any fees applied to your account

Transaction History

This detailed record lists all transactions during the statement period, usually including:

  • Transaction date: When the transaction occurred
  • Posting date: When the transaction was processed by the bank
  • Description: Information about the merchant or transaction type
  • Reference number: Unique identifier for the transaction
  • Amount: How much money was involved in the transaction
  • Running balance: Your account balance after each transaction

Decoding Transaction Codes

Understanding the abbreviations and codes on your statement

Common Transaction Type Codes

ACH
Automated Clearing House electronic transfer
ATM
Automated Teller Machine withdrawal
POS
Point of Sale transaction (debit card purchase)
DIR DEP
Direct Deposit
EFT
Electronic Funds Transfer
INT
Interest earned or paid
PMT
Payment
XFER
Transfer between accounts

Note: Different financial institutions may use varying codes and abbreviations. Most online banking platforms provide a glossary or key to help interpret these codes on their statements.

Digital vs. Paper Statements

Understanding the differences and benefits

Digital Statements

Accessibility: Available immediately through online banking, often with several years of history
Searchability: Can search for specific transactions or amounts
Environmental: Reduces paper waste
Security: Eliminates risk of statements being stolen from mail
Integration: Can often be downloaded and imported into financial management software

Paper Statements

Physical Record: Tangible copy for your files
No Login Required: Access without internet or remembering account credentials
Attention: May be more likely to be reviewed thoroughly when received in mail
Documentation: Often accepted as official proof for legal matters
Accessibility: Available to those without consistent internet access

Effective Statement Review Practices

How to review your statements systematically

1

Verify Your Basic Information

Check that your name, address, and account number are correct. This is especially important after moving or changing contact information.

2

Reconcile Transactions

Compare transactions on your statement with your personal records or receipts. Flag any transactions you don't recognize for further investigation.

3

Check for Fees

Review any fees or charges applied to your account and verify they're legitimate. Question any unexpected fees with your financial institution.

4

Verify Deposits

Confirm that all expected deposits, including direct deposits, transfers, and interest payments, have been properly credited to your account.

5

Balance Check

Verify that the ending balance matches your own calculations. This simple step helps catch mathematical errors or missing transactions.