Month End Recommendations - Auto-IT - Month End  · Month End Recommendations Pickerings Auto Group…

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  • Month End Recommendations Pickerings Auto Group

    A600 Month End Processes

  • Month End Recommendations Administration Module Process Map - A600 Month End Processes

    2

    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    Contents

    Contents .................................................................................................................................................. 2

    Business Policies ..................................................................................................................................... 3

    Introduction ............................................................................................................................................ 6

    Month End Checklist ............................................................................................................................... 7

    1. Finalise all Debtor Entries by Close of Business Last Day of Month ........................................... 8

    2. Close all Completed Repair Orders by Close of Business Last Day of Month ............................. 8

    3. Close any Parts Invoices that have been Supplied ...................................................................... 8

    4. Run Debtor Statements .............................................................................................................. 9

    5. Run Debtors Month End Process ................................................................................................ 9

    6. Run a Work in Progress Listing for Service ................................................................................ 10

    7. Reconcile Bank Account/s before Processing New Month Bank Entries .................................. 11

    8. Ensure all Deals for the Month are processed .......................................................................... 11

    9. Check that all Creditors Transactions are entered................................................................... 11

    10. Process Fixed Assets Month End ............................................................................................. 11

    11. Process General Ledger Journals ............................................................................................ 12

    12. Process General Ledger Standing Journals ............................................................................. 13

    13. Run General Ledger Reconciliation Report ............................................................................. 14

    14. Reconcile Balance Sheet Accounts that may Affect Profit ...................................................... 14

    15. Run Profit and Loss Reports and Review ................................................................................ 15

    16. Run Month End Reports .......................................................................................................... 15

    17. Reconcile Remaining Balance Sheet Accounts........................................................................ 15

    18. Run BAS Audit Report and Reconcile ...................................................................................... 16

    19. Perform BAS Transfer .............................................................................................................. 17

    20. Close Accounting Period ......................................................................................................... 18

    Appendix ............................................................................................................................................... 19

    Scheduled Account Reconciliations .............................................................................................. 19

    General Balance Sheet Account Reconciliations........................................................................... 21

  • Month End Recommendations Administration Module Process Map - A600 Month End Processes

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    Business Policies

    Business Policy A600-01

    Reporting Timelines

    Day 4: Management Accounts Exec Summary to Dealer Principals

    Day 5: Final Management Accounts

    Day 5: AutoTeam KPI Reporting

    Day 15: OEM Reporting

    Day 21: eProfitFocus Reporting

    Day 21: Business Activity Statement (BAS)

    Process Owner: Financial Controller

    Business Policy A600-02

    Weekly / Ongoing Tasks

    The following tasks are to be completed on a weekly basis, or prior to Month End:

    - Deal processing: within 48 hours of vehicle delivery

    - Intercompany journals

    - Debtor/creditor contra journals

    Process Owner: Senior Accountant / Financial Controller

    Business Policy A600-03

    Pre-Day 1 Tasks (Day 0)

    The following tasks are to be completed on the final day prior to Month End:

    - As at reports (run after hours): Labour Work in Progress Listing, Floorplan Stock Lists

    - Fixed Assets depreciation journal

    - Oil adjustments

    - Download credit card statements

    - Payroll accrual (depending on time of last pay run accrue up to 10 days only)

    - Standing journals

    o Payroll tax

    o Overhead distributions

    Process Owner: Senior Accountant / Financial Controller

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    Business Policy A600-04

    Month End Timeline

    Aim: Reporting of completed Management Accounts on Day 5.

    Day 1:

    - Month End Banking & Bank Statement Reconciliation (backdated)

    - Process deals from previous days deliveries

    - Remaining standing journals: IT, rent, utilities (if not processed pre-Month End)

    Day 2:

    - All (remaining) vehicle deals to be processed by close of business.

    - Floorplan Interest expense

    - F&I Income

    - Payroll Accrual (if pay run during month end period)

    Day 3:

    - Advertising expenses/accruals

    - Final creditor invoices to be posted (communicate cut-off to other departments)

    Day 4:

    - Accrue any remaining F&I income (if income statements not available)

    - Expense Allocation & Review

    - Writedown/provision adjustments

    - DP Executive Summary due by close of business

    Day 5:

    - Review Exec Summary with Dealer Principal

    - Complete any final adjustments

    - Finalise Management Accounts.

    Process Owner: Financial Controller

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    Business Policy A600-05

    Reconciliation Timeline

    Reconciliations must be performed in accordance with the following frequency:

    Daily:

    - Any cash-related account, e.g. Bank Statement, tills

    Weekly:

    - Deal Deposits

    - Wholesale Vehicle Debtors

    - Suspense Accounts

    Monthly:

    - Parts Returns

    - Sublet Clearing

    - Purchase Orders Clearing

    - Holdback accruals and debtors

    - Warranty

    - Factory Claims

    - Cost Estimates

    - Floorplan / Inventory

    - BAS

    - Payroll on-costs

    Process Owner: Financial Controller / Dealership Accountant

    Business Policy A600-06

    Review/Escalation Template

    Dealer Principals must be engaged to be made aware of financial risks to the Dealership. Contribute to regular review and resolution of key ongoing issues.

    Work in Progress aged items and/or customer issues

    Factory/fleet claims ensure Bulletin details are distributed/available

    Purchase Orders outstanding

    Inventory / Floorplan reconciling items

    Cash inflow: aged debtors/warranty

    1. Alert

    2. Critical

    3. Write Off

    Process Owner: Financial Controller / Dealer Principal

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    Introduction Because UNITS is driven by date entry, there are a few processes which we strongly recommend be done on the last day of an accounting period (after all daily processing) or at least, as soon as possible into the next month. With the exception of debtors there is no month end roll over to be processed. However, there are many accounting functions that need to be performed in order to finalise your month end. This document is not intended to be a comprehensive list and your dealership requirements may need to be added. If necessary, you should seek advice from your accountant.

  • Month End Recommendations Administration Module Process Map - A600 Month End Processes

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    Month End Checklist 1. Finalise all trade debtor entries by close of business last day of month.

    2. Close all completed open Repair Orders by close of business last day of month.

    3. Close any Parts invoices that have been supplied.

    4. Run Debtors statements.

    5. Run Debtors month end process

    6. Run a Works in Progress (WIP) listing for Service

    7. Reconcile Bank Account/s before processing new month bank entries.

    8. Ensure all deals for the month are processed

    9. Check that all creditors transactions are entered

    10. Process fixed assets month end

    11. Process General Ledger Journals

    12. Process General Ledger Standing Journals.

    13. Run General Ledger Reconciliation Report.

    14. Reconcile Balance Sheet Accounts that may affect profit (e.g. Stock, Vehicle Debtors, etc.)

    15. Run Profit and Loss Reports and review

    16. Run Month end reports

    17. Reconcile remaining Balance Sheet accounts.

    18. Run BAS Audit Report and reconcile

    19. Perform BAS transfer

    20. Close Accounting period.

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    1. Finalise all Debtor Entries by Close of Business Last Day of Month All debtor entries should be processed by the end of the last business day. However, It is possible to back date transactions by changing your log in date if necessary. Before running statements and end of month roll over all debtors transactions must be processed. These include:

    Repairs orders closed

    Parts invoices completed

    Sundry Invoicing

    Rental Invoicing

    Standing Journals

    Debtor Journals

    Before closing the debtors, check for the following;

    Internal debtor accounts that should be cleared

    Finance charges on overdue accounts

    Allocation of credits / payments not completed

    Write offs to be processed

    2. Close all Completed Repair Orders by Close of Business Last Day of Month Repair orders should be closed as they are completed. However, in reality this does not always happen. A WIP report should be run several days before the end of the month. All open repair orders should be accounted for. Any open repair orders that have been completed should be closed prior to the end of the month.

    3. Close any Parts Invoices that have been Supplied As with Repair orders, parts invoices should be closed when completed. However, there may be some that have not yet been finalised. Ensure all parts invoices are closed before the end of the month.

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    4. Run Debtor Statements When all debtor transactions have been completed the Debtor statements can be run and/or saved to file. There are 2 options to run statements; 1) Statement Print - this will print statements as at now. 2) Statement Print As At this will print statements as at a selected date. Statement Print must be done either last thing on the last day of the month or first thing the next morning before any processing commences. Alternatively you can use Statement Print As At. You can run this a couple of days into the month using the as at date of the previous month end.

    5. Run Debtors Month End Process This process ages each transaction by one increment. E.g. current transactions become 30 day, and 30 becomes 60 etc. BEWARE THE FIELD NAMES Next Month Start Date this is the first day of the new month. Archive Transactions - all transactions with a zero balance will move from the Current Transactions tab to the Archived Transactions tab. Archive Transactions To Date This should be last day of the month you are processing. Please note that the default is the first day of the next month. Perform Year End only do for the last month end of your financial year

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    6. Run a Work in Progress Listing for Service This report is used to calculate the journal required to move the unapplied time expense from the Labour Clearing general ledger account. It cannot be run retrospectively. The WIP Month End Journal Entry has the following ingredients to consider;

    - Payroll Journal and completed weeks. For example, a Pay Run may finish on a Monday with the Month-end Wednesday you may

    consider accruing those 2 days.

    Not recommended if on Weekly Payroll cycle.

    - Ensure anyone clocking to ROs has their Payroll going to Labour Clearing Account in UNITS For example, a Service Manager that is clocking to ROs for 50% should have the proportion

    going to Labour Clearing GL Account with the

    balance going to Service Manager Wage Expense Account.

    - Hourly Cost in Technician Maintenance should be Prime Labour Cost for the Technician not loaded.

    - On-Costs, Payroll Tax, Superannuation, Work Cover etc. should be directly expense and not put through Labour Clearing Account.

    - Ensure any overtime that is done and paid to Technicians is setup in Cost Factor in Technician Maintenance.

    Please remember no posting to Labour Clearing occur until the RO is Invoiced. DR. Cost of Labour Sales CR. Labour Clearing Account Payroll Entry. DR. Labour Clearing Account CR. Bank/Creditors With a KPI of 85% RRF => you must expect 15% Loss Time per Technician per month on average.

    This value of the Labour Clearing account should be journaled to equal this total. Any excess is probably represented by unapplied time. Extremely large values should be investigated.

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    Month End Recommendations for UNITS Auto-IT Pty Ltd | All rights reserved

    7. Reconcile Bank Account/s before Processing New Month Bank Entries Bank Accounts must be reconciled daily. The final bank reconciliation at the end of the month should be kept on file for future reference. Also the matched transactions can be cleared, once the final reconciliation is completed for the month. It is recommended that matched transactions only be cleared monthly. The month end bank rec...