Stocking loan reconciliation explained

Every dealer with a stocking facility gets a statement, usually monthly, from the manufacturer’s finance arm or an independent funder: VWFS, Ford Credit, Black Horse, Lombard, and so on. It lists the vehicles they are funding, the balance on each, and often the date each was funded. It is the funder’s view of what you are holding.

Reconciling it means answering one question: does the funder’s view agree with ours? "Ours" is two things: the stock list (what is physically here) and the creditor ledger (what our books say we owe them). When all three agree, month end is easy. When they do not, the differences fall into a small number of buckets, and each one costs money in a specific way.

Sold, not settled

The car has been sold and delivered, so it is off the stock list or marked as delivered, but it is still on the statement. The funder is still charging interest on it. This is the most expensive bucket, because the fix is a settlement that should already have happened, and every day it sits there is interest paid for nothing.

It usually happens when the sales admin process and the settlement process are separate. The car goes, the invoice is raised, and nobody tells the funder until the statement arrives.

On the statement, not in stock

Similar, but the car is not on the stock list at all. Nine times out of ten it is a sold-not-settled unit that has dropped off the list entirely. Occasionally it is a typo on the statement, or a car funded on the wrong site. Either way, you are being charged for something you cannot show.

Funded stock, not on the statement

The stock list says the car is funded, the statement does not mention it. Sometimes the funder has stopped charging (good, but check why). Sometimes it is funded on a different facility and the stock list is wrong. Sometimes it was never funded and the list is wrong. The cash effect goes the other way, but the control point is the same: the list and the funder disagree about a car.

Amount differs

The car is on both, but the balance does not match the cost price, or the ledger. Part repayments, curtailments after the car has been in stock a set number of days, interest capitalised to the balance, or simply a wrong cost on the stock list. Small differences are normal; a pattern of them is worth a conversation with the funder.

Adding the ledger

The stock list tells you about cars. The creditor ledger tells you about money. If you export the funder’s account from Xero, Sage, Kerridge or CDK (one line per vehicle, with the VIN or registration in the reference), you can run the same comparison against the books: lines the funder is charging that are not posted, lines still in the ledger that the funder has stopped charging (settled, not cleared), and amounts that disagree. That is the reconciliation an auditor wants to see, because it agrees the statement to the balance sheet.

Doing it monthly rather than annually

The value is in the rhythm. Compared with last month’s statement, which units are new, which have gone, which balances moved? An ageing table from the funded dates shows how much is sitting past 90 or 120 days, which is when curtailments bite. A manager notes each exception (settled on such a date, payment in transit, disputed), signs the month off, and the CSV goes in the accounts file.

Forecourt does this in its Manufacturer rec: upload the statement and, optionally, the ledger export, and the buckets above are produced automatically with the exposure figure at the top.