Pad to Book Reconciliation.

[CroweChizek]

I am looking for information from the parts managers perspective on reconcilement between the parts pad and the general ledger. Do you perform monthly reconciliations? Do you make an adjustment to the general ledger after the physical inventory? If there are variances what are the first things you or the accounting department check?

[dodgeboy]

funny you should bring that up. I posted a similar question a few months ago. The past few years (4-5) after each inventory we have realized a substantial write-up in parts inventory. The first few years the dealer principal kind of rolled with it. our inventory co. agreed with it, and even suggested that he would expect no less than a write-up (not including appreciation) in his parts dept. Well, I guess the owner has gotten nervous about just accepting the fact that the parts dept has ways of making extra money, and you all know how. he now has us doing a monthly, and sometimes bi-weekly reconciliarion to see how that parts dept is doing. we have started keeping track of how some of theses larger overages happen. Pre-paid SOP's never picked up, damaged cores that actually were credited back from chrysler. some times you just make extra money by accident! but regardless, we are doing recon at least monthly, no adjustments are being made until after this years final inventory, and once again we will be ahead of the GLB. Variances can be caused by many things, a posting error in parts or by the office, missing packing slips, etc.. you have to be very thorough with documents. We do perpetual inventory year round, so if we have a physical parts variance at inventory time, it is usually a inventory counters mistake.


[This message has been edited by dodgeboy (edited 06-26-2003).]

[This message has been edited by dodgeboy (edited 06-26-2003).]

[Richard]

This is what we use. Not sure how it will look on here, if you want a copy in WORD format, email me rgarrison@wilsoncomtrs.com

Monthly Parts Inventory Reconciliation Report

oMonth ____ Year ____

oSystem Generated Inventory Value (GM Only)$_________
Obtained from DMS at close of business, after Parts and Service Batches are applied and as many invoices posted to Accounting as possible.
oCore Returns In Process (Cores sent, but not Credited)$_________
Obtained from GM Credit Log, and from AC-Delco vendor credit pending file.
oMRs In Process (Parts Sent, but not credited)$_________
Obtained from GM Credit Log.
o659s In Process (Damage and shortage/overages)$_________
Obtained from GM Credit Log.
oWork In Process (Service and Body Shop ROs)$_________
Obtained from DMS at same point as System Generated Inventory Value.
oDirty Cores (Cores Waiting to be Returned for credit)$_________
Must be counted manually.
oMiscellaneous Parts (Other than GM)$_________
Hardware, and Misc. (Use KR, and OT stocking groups Counter Pad amounts)
oGM Packing Slips Pending (Received, but not invoiced)$<_____>
Face Value Cost, manually costed.
oGM Invoices (Invoiced, but Parts not received Yet)$_________
Cost, manually accounted *Rare.
oOutside Purchases (Parts Sold, but not enter in acct yet)$_________
Must be manually counted.
oAdd Ons $_________
Any Credit, or Parts not otherwise listed.
oPending Batches (ROs and Parts Inv Closed, but not applied)$________
Pulled from Batch Edit Sheets the next day after a cutoff.

oAdjusted Inventory Balance$_________
All above lines combined.

oGeneral Ledger Balance (Acct 242)$_________
Obtained from DMS at the same time as the System Generated inventory Value.
oAppreciation/Depreciation (Price Tape Update)$_________
Obtained from DMS hold file when Price Tape is applied (Monthly)
oAdjusted General Ledger Balance$_________
General Ledger Balance and Appreciation/Depreciation combined.

oDifference$_________
Adjusted Inventory Balance versus Adjusted General Ledger Balance.




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[tjsmith]

We do it monthly. Reason being if there is a mistake you only have to go through a month of paperwork, & not a year, & believe me it is a lot easier. But we do not make any adjustments, until final inventory is done, unless there is a huge mistake that needs corrected.

[This message has been edited by tjsmith (edited 06-27-2003).]