Repair Order Documentation and Document Retention

[jjgiardina]

My specific issue is vehicle history files. Ive had the pleasure of dealing with a couple of auditors who have come to our dealership to perform an expense review. On both occasions my new friends took issue with the fact that we file our hard copies by RO number, and contend that we are in violation of P&P. Weve debated P&P articles 1.6.1, 1.6.2 and 1.6.3 intensively. There position is that ROs must be filed by VIN and this file must contain all related and cross-referenced documentation. Our contention has been that since we use R&R which has the ability to access service history by VIN electronically, we are not required to adhere to the guidelines of the Paper RO System. Since we can retrieve vehicle history electronically we are only required to retain the supporting documentation, have it cross-referenced and retained separately. The auditors basically dismiss this. To me, the issue is really about making their job easy for them at our expense by giving them a host of documents that werent an issue in the first place allowing then to review them and potentially charge us back. From our point of view computers were created in order to lessen the need to have additional staff perform menial function such as filing and purging these paper files, in addition to the expense of personal and storage etc, Never mind the fact that in our opinion we are in compliance.

[fburrows]

Jjgiardina:

This is one of my pet peeves. I used a similar system for 15 years in a big Chevrolet dealership (25 techs) with no problems. I made a deal with the accounting office to file the white copies after they were through with counting the money and doing their reconciliation. The hard copy of the repair order became the white accounting copy. It had the technicians writing and the labor stickers. We attached the original copy of the invoice to this copy along with insurance estimates, credit card slip, night drop envelope, customers notes and filed this by repair order number. The other rule we enforced was that nobody could remove an original from the cashiers counter. She would make copies for anybody but the originals stayed there. We kept the pink copy of both documents filed by document number.

Every time we were audited by a new group they went nuts when they first saw it. We gave them a password and a computer terminal to look up histories, which they did not get anywhere else. After lots of threats and a couple of days they realized that my way was actually easier for them. I never got a letter or even a call from the Zone. I left the dealership after 29 years, two years ago. Now my partner and I develop systems for dealerships and we are constantly amazed at the time, space and expense dealers spend on these huge paper file systems. My partner wants us to get into the document scanning business every time we see one of these systems. You would not believe the number of service departments we see that have one person dedicated to filing paper.

I realize that you and I stuck our necks out by not following the P+P exactly but in my view the factories will never change the old systems to benefit the dealers. You can either take an aggressive approach or spend lots of time and money filing tons of paper. I feel that as long as you have what they need and dont purposely engage in fraudulent activities and use common sense you will not have a problem.


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Frank Burrows
Automotive Business Solutions
frank@autobusiness.org

[robc]

The key to this whole thing is what you mentioned - they do this to make their job of auditing dealerships easier. Apparently with no concern for the added clerical burden it might place on a dealership.

My general finding when dealing with auditors is that anything that is outside of the norm to them suddenly becomes "cause for concern" and they wonder what you're trying to hide. When actually we are just trying to get out of filing hard copies. When it comes to record retention, they just seem locked into 1985 and unable to escape. I swear having a new idea about record retention is like selling a TV to the Amish.

That being said, depending on your relative influence in the region, I'd tell the auditor that you're not going to revamp your entire way of retaining system for your bi-annual visit. The P&P in 1.6 opens by saying that retention is "intended to be flexible and adaptive given the potential variables" and what they are suggesting (although technical correct) does nothing to make it flexible. But realize that this can only cause three actions:

(1) They flag you for being in violation of the P&P and charge back all the claims you've submitted for the past two years.

(2) They agree with your logic and wonder why they were being so anal

(3) They begrudgingly work with "your" system and aren't exactly willing to cut you a break on any questionable claims.

Well, choice one isn't likely, and number two is never going to happen - so you are left with item three.

So it's up to every store to make their own decision of what they want to do. Realizing that it's proably going to equal more chargebacks.



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** Rob, Editor WD&S **
Help is only a message post away!
robc@dealersedge.com

[sallen1]

Hey, Rob's right...

The auditors will nail you for not following the P&P. It's the same argument for breaking other rediculous rules, but rules are rules (ask a couple NCAA football players...).

We have gone to the extream of filing by both RO and VIN. We have two 100ft. storage containers full of the stuff (Calif. BAR requires 5 year retention). However, the auditors are impressed by our ability to find stuff when asked.

And never, never, never let the auditors alone with your files. Ask for a list of stuff and get it for them. They tend to 'snoop'.

Trying to argue P&P will get you nowhere fast. Even when you go to arbitration, you'll be scorched. Watch out. Then only thing we can do is get the P&P changed, but that is like trying to turn an aircraft carrier, takes time.

scott

[jjgiaridina]

See the point is if we aren't in compliance then it's our responsiblity to rectify the situation. Don't i see it. Even under the most "liberal" terms we do not have a paper system, so the only reason i can see to follow the requirements of a paper system is to give the auditor access to claims that have nothing to do with why he is there. At most it's what GM refers to as a hybird, and there is no specific guidelines for hybird. Unless of course you use a bit of common sense and realize that the extent that they've gone to outline the electronic system also applies to the hybird. Interestingly enough when i deal with Chrysler auditors at our other location, there first reaction is similar to GM's only they are willing to except the explaination. And one last thing before i shut up, GM has a habit of asking to see the RO's and then when supporting documentation isn't attached they use that to say that you didn't provide them with all the necessary documentation to support the repair. They never asked for it.