Set-Off Statement

A Set-Off Statement is a document used in financial transactions that shows the net amount owed between two parties. When two businesses owe each other money, instead of paying both amounts separately, they can offset their mutual debts. The statement details how much each owes and calculates the final amount payable after subtracting the smaller debt from the larger one. This process simplifies payments, reduces cash flow movement, and clarifies the exact balance due, making it an efficient way for companies to settle accounts when there are existing obligations on both sides.