Why compare at all
Bills get lost in the mail, entered twice or recorded for the wrong amount. Payments may be applied by the vendor to the wrong invoice. Credits can be forgotten. A statement is a quick way to spot all of these in one look.
It matters most for vendors with many invoices each month, such as suppliers, subcontractors and utilities.
Request and prepare
Ask key vendors for a monthly statement showing open invoices, payments and credits. Run your own vendor ledger or open bills report for the same date. Print or open both side by side.
Match line by line
Tick off each invoice that appears on both. Note items on the statement that are not in your records, which might be missing bills. Note items in your records that the statement lacks, which might be unrecorded by the vendor or duplicates on your side.
Check amounts, dates and invoice numbers. A small difference may be a discount, a freight charge or a typo.
Resolve differences
For missing bills, request copies and enter them if valid. For duplicates, delete or void yours, or ask the vendor to correct. For payments not credited, send proof such as the check image or transfer confirmation. For disputed prices, compare with the quote or purchase order and ask for a credit memo.
Record the outcome in the bill notes and keep the email trail.
Watch credits and timing
Unapplied credits are money you are owed. Apply them to the next bill or request a refund. Also consider timing: a payment mailed late in the month may not show on the statement yet.
Reconcile the difference by listing items in transit, so the remaining gap is truly unexplained.
Make it routine
Do the full exercise monthly for your largest vendors and quarterly for the rest. Keep a short log of vendors reconciled and dates. Before year end, confirm balances with every vendor you owe a meaningful amount.
If your payables balance includes old amounts with no matching statement, investigate. They may be paid items entered wrongly or bills that should be written off with documentation. Your bookkeeper can handle the process if you send the statements.
A supplier statement lists an invoice you never entered, a payment you made last month that was not applied, and a credit for returned goods that has not been used. Your records, in turn, show one invoice entered twice. After sorting this out, you gain a missing bill to record, proof of payment to send, a credit to apply and a duplicate to remove. Four small fixes, found in ten minutes, that would otherwise appear as an argument months later.
Common questions
Do I need statements from every vendor?
Focus on those with frequent or large activity. Small one-off vendors can be skipped.
What if the vendor will not send statements?
Run your own ledger report and ask for an account summary on request.
Can a statement be wrong?
Yes. Statements are generated from the vendor's records, which have errors too.
This guide is general information, not tax, legal or accounting advice. Rules, fees and due dates change; check with the IRS, the NJ Division of Taxation or a licensed professional for your situation.