Tag: Year End

“Must-Dos” for Year-End Excellence and a Fresh Start to 2020

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This article originally appeared in Digital Dealer here.

By Susan Moll and Matt Hurst

A new year and a new decade means new opportunities for your dealership. But with the new, comes closing out the old. From completing 1099s and W-2s to updating model lines and account numbers, finding balance after the end of the year requires a combination of efficiency, organization, and partnership with your DMS provider.

The following are some “must-dos” to help you take control and ensure a clean slate for 2020.

1. DO repeat after us – January 31, January 31, January 31. Make sure that date is in your calendar and that you have alerts set far in advance because January 31 is when your W-2s, 1099s, and 941s are all due. Start getting these forms ordered, printed, and filed as early as possible, to keep your dealership running smoothly and on schedule.

2. DO create a year-end checklist. When asked what her secret to a successful year-end process was, Lori Garrison’s response was clear and concise – build a checklist. Garrison, who is the controller at Huffines Auto Group, uses the same checklist year after year and modifies it with notes or memos when anything important about the process changes. Whether it’s updating tax tables, ordering forms, or filing and paying vehicle inventory taxes (VIT), everything she needs to close out the year is found on the checklist.

3. DO conduct an annual physical inventory count and reconcile any discrepancies. It’s critical to count your physical inventory at least once a year to make sure your parts inventory value matches what is actually on the accounting books. This count will help ensure that all necessary adjustments are made so you don’t carry any deficits into the new year.

4. DO only what you can do. “As a controller and manager, it’s important to make sure you’re always empowering your staff rather than micromanaging them,” explains Garrison. “You should only do what only you can do.” In other words, delegate the work and entrust as many tasks as possible to your staff rather than trying to touch everything yourself. By doing this, your staff can broaden their understanding of the business and you can focus on the responsibilities that fall strictly on you.

5. DO remember there are ways to stay on top of year-end reporting all year long. Lisa Feagin, the controller at Tom Bush Family of Dealerships, recommends running your month-end process like your year-end process. “By reconciling account accruals and write-offs every month, you’ll be able to spend more of your time focusing on the minute details at the end of the year, such as putting accounts under a microscope to catch any errors or discrepancies,” she explains.

About the Author

Susan Moll, Senior Director of DMS Field Services, Cox Automotive. Matt Hurst, Senior Director of Client Services, Dealertrack DMS.

This article originally appeared in Digital Dealer here.

Must-Dos to Score an A+ on Your Dealership’s Month-End Processes

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This article originally appeared on Digital Dealer here.

By Susan Moll and Matt Hurst

Can you hear the pencils sharpening, expo markers squeaking, and fresh new backpacks zipping? While it’s back-to-school season across the nation, at the dealership, September is also a great time to start anew by giving your strategy a refresh, beginning with your approach to month-end processes.

Whether you sell 10 or 100 cars per month, you should always take a step back to grade your month-end approach to ensure you’re setting yourself up for success. Are you maximizing efficiency, or do you feel like every month is a scramble to close out? Is your DMS provider helping to ease the process and streamline the workflow for you, or are they making it more difficult? What’s working well and what’s holding you back? Are you accounting for all of your sales and expenses?

It’s a lot to consider, which is why we recently connected with Karli DeVall, CFO of Tim Dahle & Red Rock Auto Groups and former automotive accounting consultant, to help put together some of the must-dos to make sure you ace your next “month-end report card.”

Create a Checklist

For Karli, who has worked with dealerships of all different shapes and sizes, the number one must-do heading into month-end closing is to create a checklist. Your checklist should outline the tasks that need to get accomplished on each of the four key days associated with month-end closing (usually the first four days of the following month). If you already have a checklist ready to go, make sure it’s up-to-date and covers all bases. Staying organized throughout the month-end process is essential to maintaining accuracy and efficiency, not to mention ensuring you have all the necessary information to effectively calculate KPIs.

So, how should you break out your checklist and what are the must-dos for each day?

Day 1 Must-Do: Count Your Physical Assets.

From new and used vehicles to service and parts, every department should use Day 1 of the month-end process to take inventory of their physical assets. Over the following three to five days, your accounting team will take this information and reconcile it against the books, so the sooner you get this data into the system the better.

Day 2 Must-Do: Count the Sales.

Day 2 is for reconciling and counting all the sales for the month. To do this successfully, it’s important to first ensure all sales are completed and verify that none of your assets are missing or out of place.

Day 3 Must-Do: Do an Expense Trend Analysis.

On Day 3, make sure all expenses are in and then conduct a trend analysis to see if you are missing anything. For example, did rent post on the first and 31st of the month or is there a particular utility that has been trending high over the last few months? Doing an expense trend analysis will help you get to the bottom of these questions. Ultimately, you want to make sure your dealership survives and thrives every single month, and getting those expenses submitted is a crucial piece of this.

Day 4 Must-Do: Add Statistical/Memo Postings to the Financial Statement.

Use Day 4 to confirm all your managers’ commissions are properly accounted for. Once payroll has been completed, take the time to ensure your statistical/memo postings are added to your financial statement. This step is vital bbut often skipped by controllers. While Karli notes that the majority of a financial statement is often pulled right from the books, the rest is usually a compilation of little statistical/memo postings that give you a more detailed look into your business and how you’re stacking up against your KPIs. Without these postings, you don’t have the insight needed to measure KPIs. Period.

The role of a dealership controller is critical. You’re responsible for the financial condition of the dealership and you know all the ins and outs of the business. But when it comes to month-end, chaos can quickly break out across departments. While modern, open technology has made the process easier, it still takes all hands-on deck and a structured plan of attack to close out the books properly and on time.

Look to your new checklist and DMS provider to help guide you through the smoke. You want to end each month seamlessly, so take advantage of your DMS provider’s various resources, from training sessions and webinars to peer-to-peer learning exchanges. With the right provider and approach on your side, you’ll take a lot of that weight from the month-end process off your shoulders.

Stay tuned for more as this is part II in a monthly series of must-dos to keep your dealership running efficiently all year long.

About the Authors

Susan Moll is Senior Director of DMS Field Services for Cox Automotive and Matt Hurst is Senior Director of Tech Client Support for Dealertrack DMS.