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Neglecting a Small Task Now, Will Turn into a Big Task Later

By Courtney Becton

Have you ever had so much clutter around, you couldn’t identify something right in front of you? It became lost and camouflaged in the shuffle. Or, maybe you lost something and didn’t realize it was missing until you had a reason to look for it. High volume dealerships are more likely to have irregular balances in their accounting schedules. If these schedules have not been reviewed, researched, and reconciled routinely, and in detail, they are more likely to have a significant and costly mess to clean up later. As tedious as this task may seem to some, we can’t stress enough the importance of having a reconciliation process high on the list of the accounting department priorities. Schedule reviews and account reconciliations should be at the top of the “To Do” list, at a minimum, on a monthly basis. For best practices, we recommend making it a habit of reviewing schedules when the transactions impacting the schedule are current.  This could be as simple as a billing clerk reviewing the inventory, and vehicle settlement / receivable schedules after all deals are posted for the day so errors can be corrected right away. Staying ahead of potential issues is a good practice in monitoring daily activities and correcting issues before they get out of control or find it’s too late to correct and worse, too late to COLLECT. Controllers and departmental managers should be aware of any anomalies, aged items, and exceptions. There is a RISK in NOT KNOWING what you don’t know. A single dollar amount camouflaged in the shuffle could be the one transaction that gets away and cannot be found until there is a reason to look for it.

The disadvantage of not staying on top of this task outweighs the small headache of just doing it when it should be done.

Neglecting schedule reviews may subsequently lead to issues like:

  • Decreased visibility of irregular transactions and susceptibility to fraudulent activity.
  • Time-consuming reconciliations chasing aged items and exceptions.
  • Excess dedication of resources or overtime dedicated to historical transactions.
  • Losses through write-offs that could have been avoided with routine schedule reviews.
  • Inaccurate and unreliable financial statements.

In part, these are just some of the issues a dealership can be exposed to if consistent and frequent schedule review and reconciliation processes are placed on the back burner. You don’t want your schedules to get so far out of control that you end up with a massive mess to clean up and having to use extra personnel resources to do so. It is more costly of a road trip when chasing questionable balances when you have to retrace the entire route back to the beginning of the transaction. Eliminate the clutter, stay focused and have complete visibility to the potential future problems which are right in front of you.

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