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I am a Honda dealer. I have my obsolescense under control, I am at 2.9%. I do however have some non-returnable "treasures". I am told there is way to "cash-in" at 50% if you are below 5%. I have the green light to to this and then scrap on my own, just not sure where to start. It has something to do with letting your SRA "roll- over" I also want to be a little careful not to get too much money back. I can probably only use 2-3K to get rid of the "junk" on hand. Are there any Honda dealers out there that have done this?

Thanks in advance for your help,

John

I am a Honda dealer. I have my obsolescense under control, I am at 2.9%. I do however have some non-returnable "treasures". I am told there is way to "cash-in" at 50% if you are below 5%. I have the green light to to this and then scrap on my own, just not sure where to start. It has something to do with letting your SRA "roll- over" I also want to be a little careful not to get too much money back. I can probably only use 2-3K to get rid of the "junk" on hand. Are there any Honda dealers out there that have done this?

Thanks in advance for your help,

On the Honda IN, when you go to SRA Inquiry, you are given a dollar amounts for "SRA Current Month Accumulated Amount". Do not send a buyback this month, and that dollar figure will move to "SRA Carryover Amount". Do not send a buyback next month either, and 50% of that dollar amount will be credited to you at the end of the following month in Acknowledgements. Then just see your accounting department and ask them to apply appropriately.

I use 50% of my available SRA, accrued from previous month, for SRA returns in current month. Honda will automatically calculate unused SRA and issue credit on the balance forward statement. All I have to do is turn in my monthly SRA statement to our office manager and she applies the credit to an accrual account that I use to scrap non returnable parts. Keep in mind that the unused SRA credit is calculated from 2 months back, meaning the credit I receive in April is from unused SRA in February.

Unless the terms have changed you must also write a letter of intent to American Honda and give it to your DPS M. it's a great thing for those who have little to no obsolescence and once you're in you're in. As the others have stated you'll be able to see from your monthly SRA statements where you stand. However I would caution you not to work to this number as a general manager and owner may come to expect it every month. When you do the right thing the money will come to you.

As far as scrapping goes John, you need to write off with real money regardless of where it comes from. Make this a process monthly and it will hurt a lot less.