Characteristics of the Automotive Sector
Whether your company is a dedicated automobile dealership for one or multiple brands, a car broker, or engaged in vehicle repairs as a multi-brand garage, as a chartered accountant, we identify several key factors for your business’s economic activity in the automotive sector;
- Efficient management of new and second-hand vehicle stocks and spare parts.
- Quality of the relationship between the dealer and the manufacturer whose brand is being marketed.
- Personnel management.
The available stock of spare parts reduces vehicle turnaround time. A stock of demonstration vehicles is necessary for the sale of new vehicles. A stock of second-hand vehicles is also necessary to build up a clientele that regularly entrusts their vehicles for maintenance and repairs. However, these stocks require significant working capital and tie up unproductive cash-flow. Additionally, they entail costs for their maintenance, regardless of their composition.
The quality of the relationship with the manufacturer is also decisive if the company is a dealership. Indeed, the dealer is dependent on the commercial policy established by the manufacturer and the exclusive geographical area entrusted. Finally, the quality of the personnel in the sales and repair teams is a success criterion for your business, as well as the supervisory capacity of the team leaders, with customers ultimately being the judge of the quality of service provided..
We work with a wide range of compagnies in the automotive sector: highway breakdown service, road freight transport firms, automobile dealerships, and garages, etc. Whether they are mechanics, dealers, or transporters, our clients trust us to handle their accounting, taxation, and payroll matters, allowing them to focus on managing their businesses.
Relations with manufacturers, regulatory changes, competition from other stakeholders, digitalization, financial resources, securing margins, we master the specificities and issues that drive the sector.
We have many clients whose activities are involved in the automotive sector, and as their chartered accountant or statutory auditor, our multidisciplinary approach allows us to offer you a comprehensive service that addresses your concerns.
As a chartered accountant or statutory auditor, various skills at the service of your garage or automotive dealership
Beyond our mission of bookeeping accounting or auditing revision, as a chartered accountant, we offer you a personalized service, anticipate your needs, and inform you of evolutions in social and tax regulations that affect your activity, in order to implement suitable solutions.
As a statutory auditor, we adopt a constructive and flexible approach, based on substantive tests but also and above all on the review of your various processes, in collaboration with your teams, in order to build a relationship of trust with them and provide recommendations for continuous improvement of these processes.
Our development in terms of accounting expertise and statutory audit relies on the technical support of our versatile and regularly trained team, the proximity and availability of experts-accountants and associated auditors who are available and attentive when you need them.
Support for the company and its executives as a chartered accountant for your garage or car dealership
Accounting Management
Our mission of bookkeeping or auditing for your car dealership or garage is above all an accompaniment intended to :
- create or take over a car dealership or vehicle repair garage,
- secure your margins through regular and accurate accounting tracking,
- analyze your performance by implementing analytical accounting if necessary,
- optimize your financial resources, particularly external financing.
In order to ensure the reliability of the established financial information, we assist you in implementing an effective internal control, as well as the appropriate tools, management software or dashboards, allowing the monitoring of the margin by nature of products sold by your car dealership or your vehicle repair garage.
If your car dealership or garage is a subsidiary of a foreign group or a company held by venture capital firms, as a chartered accountant, we produce periodic reports for the fund providers..
Tax management
As a chartered accountant,, we take care of the preparation of recurring and occasional tax returns. We study your eligibility for tax credits that may be applicable to your company in the automotive sector. We accompany you during tax audits and keep track of changes in tax legislation regarding the different Finance Laws. We master the tax specificities of your sector.
Social Management
On the social level, Houdart A&C has an expert knowledge of the collective agreement applicable to the automotive sector, thanks to numerous companies operating in this field of activity among its clientele; car repair garage, specialized company in sales of spare parts, automotive dealership, road transport companies, etc. We master the specificities of the provident institution IRP AUTO, which covers employees in the automotive distribution and repair sector.
We establish the payrolls of our clients’ employees attached to the automotive sector, assist them throughout the control of URSSAF (Unions for the Recovery of Social Security Contributions and Family Allowances), establish the DSN (nominative social declarations ) and can take care over the dispatch of employees’ payslips and salary transfers.
We take care of affiliations to the competent provident institutions according to your company’s activity sector.
We advise you in case of difficulties with one or more employees and put you in touch with a lawyer that we are ready to recommend in case of labour disputes.
Legal assistance
Our legal department offers you assistance in common and extraordinary legal missions of a company’s life. We are also available to provide you with all the advice that you, as a director of a company involved in the automotive sector, may need in the conducting your business.
Our legal mission includes : the annual legal secretariat, the drafting of certain acts, the drafting of the minutes of ordinary and extraordinary general meetings, convocations, statutory modifications (transfer of the company’s registered office, company name…), formalities with the clerk’s office of the competent commercial court, etc.
We finally assist you in carrying out operations such as contribution, company transformation, merger and demerger.
Due diligence
When an opportunity for external growth arises, as an advisor or as auditor, we are able to conduct an acquisition audit of the target company prior to your decision-making process.
Guidance to business leaders in the automotive sector
Our mission extends beyond the mere preparation of your company’s financial statements. For our family-owned business clients, we go further by providing support to the company director on matters of patrimonial management. This ensures that decisions related to the business, which may impact both the director’s assets and those of their family, are optimized for their overall benefit.The diversity of our skills allows us to assist you primarily in your personal tax declarations. We prepare your income tax returns in France, as well as your potential real estate wealth tax return.
We assist you in the choice of your individual and collective health care and heavy risk insurance contracts. We verify that the formalities for setting-up the contracts cover the risk of fiscal and social adjustment.
We accompany you if necessary in the context of your personal tax audits.
The acquisition of his company’s real estate is often an interesting way for the head of the company to reconcile the interests of his company with the development of his personal assets.
We accompany the business manager since the initiation of the project, the decision-making process for real estate investment, the choice of investment structuring, and even the preparation of necessary documents to apply for funds from financing institutions.
We have a significant network of professionals specialized in insurance brokerage, notary, and lawyers specialized in social or tax law that we can mobilize to supplement our support for the concessionaire company or the automobile garage.
Lastly, we accompany and study with our clients the different possibilities of social regime and remuneration modes in order to optimize the entrepreneur’s remuneration on the fiscal and social level.
MyUnisoft, a digital, collaborative and innovative accounting software
Our accounting production tool is innovative, efficient, collaborative and is intended to be a real market place with an open API, to which most of the current apps used by entrepreneurs can be connected, whether it is digital neobanks, tools for monitoring sales, CRM, EDM, data analysis or payroll software.
Thanks to agreements with most banking institutions, we can set up with your bank an automatic recovery of your bank flows in EBICS format.
We can provide your accounting teams with our software to collaborate on your financial data in real-time. We can also fully take care of your bookkeeping if you don’t have an accounting service.
We can make our software available to your accounting teams in order to work together on your financial data in real time. We can also fully take care of your bookkeeping if you don’t have an accounting service.
Common automotive dealership and garage sector
How do Year-End Discounts (YED) work?
Year-end discounts (YED) refer to discounts based on the quantities ultimately purchased by a dealer. They are commonly calculated on the basis of purchase volume over a given period. YED allows the adjustment of pre-negotiated rates based on actual purchase volumes not known at the time of contract signing.
YED must be included in a contract concluded between the distributor and the supplier. According to Article L. 441-7 of the Commercial Code, there can be no YED if there is no contractual document between the parties explicitly stating the year-end discounts and the conditions for determining them, such as purchase volume constituting the trigger threshold, % discount by purchase level, the period for calculating the YED base, etc.
Should year-end discounts (YED) be provisioned?
Year-end discounts (YED) are usually recorded by both the paying company and the beneficiary company when the conditions for granting the discount are met. In the case of a year-end discount granted on the basis of sales volume, an accrued expense at the payer’s (and an accrued income at the beneficiary’s) must be recorded, at the closing balance sheet date, according to the contractual stipulations. A liability on the part of the payer (income on the part of the beneficiary’s) must be recorded as soon as the contractually fixed turnover volume is reached.This liability can only be settled through payment, set-off against receivables, or by the beneficiary waiving his right to YED, or by commercial prescription.
What is the insurance organization for the automotive sector?
L’IRP AUTO is the complementary social organization referenced by the branch of companies involved in the distribution or repair of cars and motorcycles and the technical control of vehicles. IRP AUTO’s contributions and services cover prevention, supplementary retirement, providence, complementary health, employee savings and social action for employees and non-salaried workers in the automotive sector, throughout the metropolitan territory.
How is VAT determined in companies selling automobiles (dealerships or agents)?
The sale of new vehicles is subject to VAT at the standard rate of 20% on the total sales price.
Buyers who resell second-hand vehicles may opt for the VAT margin scheme. In this case, VAT is applied only on the margin realized (sale price including VAT – purchase price including VAT) and not on the total resale price. The practice of the VAT on the margin is only possible on second-hand goods which have not been eligible for deduction.
Buying a vehicle abroad, what is the Tax Clearance?
The tax clearance (or tax certificate) indicates that the vehicle acquired is in a regular situation with regard to value added tax (VAT). It is essential for obtaining a car registration document if the new or used vehicle was acquired in an EU country other than France.
In order to combat VAT fraud, Article 21 of the amending finance law for 2014 imposed the obligation to justify the VAT regime applied by the initial taxable seller located in an EU country other than France in order to obtain the tax certificate.
What is the difference between a car broker and a dealership?
A car broker acts as an intermediary between dealerships and individuals wishing to buy a car. He is a trader who buys vehicles from dealerships in order to resell them to private individuals.
Legally independent, the dealer is bound by a dealership contract to a manufacturer for the distribution of cars of the brand owned by the manufacturer. He benefits from the manufacturer’s financial and commercial support for the sale of new vehicles as well as for all or part of the after-sales service.
Is cost accounting required in a dealership or garage?
Analytical accounting allows the company’s products and expenses to be accounted for by function or service, whereas general accounting is based on a classification by nature. This makes it possible to transcribe into accounting the result by service (workshop, sale of new vehicles, sale of used vehicles), by breaking down the products but also the purchases of parts, direct and indirect workforce costs, etc, etc.
What is the collective agreement applicable to car automobile dealerships and repair companies?
The national collective agreement for the automobile, cycle and motorcycle trade and repair and related activities, as well as for the automobile technical control of January 15, 1981 (n° IDCC 1090) applies to all employees working for companies, groups and professional organizations whose activity is related to the sale, maintenance and control of vehicles.
Why use an accounting firm specialized in the automotive sector?
The choice of legal structure to carry out your business, the anticipation of tax risks, the rigour in determining the VAT system applicable to vehicles sold, compliance with social regulations and contractual provisions, the formalism of the implementation of the life insurance policies,the accompaniment of the manager in a deeply changing environment, the establishment of relevant dashboards, the implementation of efficient processes for regularly updating accounting records, are all topics on which a chartered accounting firm extensive experience working with companies in the automotive sector will be able to assist you beyond the scope of simply monitoring your accounting and preparing your balance sheet and income statement.
