Account Analysis Statement

An account analysis statement is a periodic report, usually monthly, that a bank sends to a business customer showing the average balances held in its accounts, each service the customer used with its volume and unit price, any earnings credit given for those balances, and the net amount the customer owes. It is the main way banks bill for cash management services such as wires, ACH, lockbox, controlled disbursement and online banking, and it is most widely used in the United States.

The statement is separate from the ordinary bank account statement, which lists transactions and balances. Account analysis turns that activity into a bill. Treasurers use it to check fees, compare banks and negotiate pricing. In the US, most banks code services using the AFP Service Codes maintained by the Association for Financial Professionals, and many deliver the data electronically in the ANSI X12 822 format or the ISO 20022 camt.086 Bank Services Billing message.

Picture a gym that charges for each class you attend, but gives you credit for every month your membership deposit sits with them. At the end of the month you get one sheet: classes taken and their price, minus the credit for your deposit, equals what you pay. If your deposit is big enough, you might pay nothing.

An account analysis statement is that sheet for a business bank account. The bank lists everything it did for the company, puts a price on each item, then subtracts a credit based on how much money the company left with the bank. The company sees exactly why it is being charged and can spot services it no longer needs.

• Balance summary. Average ledger balance, average float (uncollected funds) and average collected balance, often with a deduction for a reserve requirement.
• Service detail. Each service by code, with volume, unit price and total charge, for example 1,250 ACH credits at 0.08 each.
• Earnings credit. A credit calculated on the collected balance at the bank's earnings credit rate (ECR).
• Balance-based charges. Pass-through costs such as the bank's deposit insurance assessment, often shown as a fee per 1,000 of balance.
• Settlement. The net charge, debited from the account, or an unused credit, which in most arrangements expires at month end.

Many companies with several accounts receive a relationship-level analysis that combines all accounts so that balances in one offset fees in another.

The earnings credit is usually calculated as:

• $\text{EC}$ is the earnings credit for the period.
• $\bar{B}$ is the average collected balance.
• $r$ is the reserve deduction the bank applies, as a decimal (some banks use zero).
• $\text{ECR}$ is the annual earnings credit rate, as a decimal.
• $D$ is the number of days in the period (some banks use a 360-day year).

A company with an average collected balance of 2,000,000, a 10% reserve deduction and an ECR of 1.5% earns, over a 30-day month, $2{,}000{,}000 \times 0.9 \times 0.015 \times \frac{30}{365} \approx 2{,}219$. If its service charges for the month are 3,000, it pays about 781. To cover the fees entirely it would need roughly 2.7 million in collected balances at the same rate.

For decades US federal rules (Regulation Q) banned interest on business demand deposit accounts. Banks compensated companies instead with earnings credits that could only be used to offset fees. The Dodd-Frank Act repealed the ban with effect from 21 July 2011, so banks may now pay interest on business current accounts, but the earnings-credit model persisted because it suits both sides: banks keep stable operating balances, and companies pay fees with balances they hold anyway. Earnings credit rates tend to move with market interest rates but lag them and are set at the bank's discretion. Since the Federal Reserve cut reserve requirements to zero in March 2020, the reserve deduction is a bank pricing choice rather than a regulatory cost.

Treasury teams review analysis statements to:

• Check pricing. Confirm unit prices match the agreed fee schedule and spot new or increased bank charges.
• Optimise balances. Decide whether surplus cash is better left to earn credits or moved into a sweep or money market fund at a higher yield.
• Compare banks. Standard service codes and camt.086 data loaded into a treasury management system allow like-for-like comparison, which matters in multi-bank cash management.
• Cut unused services. Dormant accounts and unused service modules often keep accruing monthly maintenance fees.

Outside the US, banks more often bill business customers through a tariff with direct debits and pay or charge interest on balances, but large international banks increasingly provide camt.086 billing data to multinational clients.

• Association for Financial Professionals
• ISO 20022
• Board of Governors of the Federal Reserve System