Running an auto dealership means coordinating several interconnected departments — sales, parts, service and financing — all moving at high speed. Without a solid month-end close, it’s easy for financial accuracy to skid off course. A disciplined close process keeps your numbers reliable, your team accountable, and your dealership positioned for year-end success. THE IMPORTANCE OF A DISCIPLINED MONTH-END CLOSE A clean and timely month-end close is the foundation of dealership financial management. Management decisions, factory reporting and lender relationships all rely on accurate numbers. When accounts are reconciled and each department’s performance is accurately captured, leadership can act with confidence. Regular reconciliations also prevent costly surprises. Small discrepancies that go unchecked can snowball into major accounting issues, or worse, missed opportunities. Just as importantly, strong month-end habits reduce the chaos of year-end audits and tax preparation. A dealership that closes well every month closes the year with less stress, fewer adjustments and better results. CORE MONTH-END CLOSE PROCEDURES Reconciling the Balance Sheet Start by confirming that all cash accounts, including F&I reserves and manufacturer incentive accounts, are reconciled. Review receivable schedules against the general ledger and evaluate aged customer and warranty receivables for collectability. Match vehicle inventory subledgers to physical counts in your DMS and ensure used vehicle valuations make sense. Payables require equal attention: Confirm that invoices, floorplan payoffs and trades are fully recorded. Don’t forget to verify payroll and accruals by ensuring that commissions and bonuses are complete and properly timed. Reviewing the Income Statement Each department’s gross profit should be compared to prior months and budget expectations. If something looks off in new, used, parts or service, investigate early. Align factory incentives with the period when revenue was earned and double-check that prepaid expenses or allocations haven’t been spread incorrectly across months. Schedule Review and Clean-Up Identify stale or unexplained balances and utilize exception reports to flag issues that require attention. Intercompany and dealer group balances should be reviewed regularly to ensure they’re cleared and properly recorded. Documentation and Sign-Off Every dealership accounting team should maintain a month-end checklist with preparer and reviewer sign-offs to ensure accountability and maintain audit readiness. Storing supporting documents electronically is a simple way to keep records organized and accessible when questions arise. LEVERAGING TOOLS AND TECHNOLOGY A structured checklist remains one of the most effective tools for month-end accuracy. Assign tasks to multiple roles to create built-in review points. Most dealer management systems (DMS), such as CDK, Reynolds or Dealertrack, offer automated reports that simplify reconciliations and reduce manual errors. Consider integrating accounting automation tools or AI-based reconciliation software to handle recurring entries and flag anomalies. Dashboards can also help track close status across departments, ensuring visibility and accountability throughout the process. PREPARING FOR YEAR-END Conduct a “Pre-Year-End” Close Treat November as a trial run for year-end. Address any lingering issues, clean up suspense and clearing accounts, and confirm balances with manufacturers, especially floorplan, warranty and rebate accounts. HOW A STRONG MONTH-END CLOSE DRIVES FINANCIAL SUCCESS FOR DEALERSHIPS BY ERIKA GAGNE, CPA ALBIN, RANDALL & BENNETT 24
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