Case Study. Accounting for the automotive industry
Accounting in the automotive industry involves a specialist, more complex approach that differs from the standard accounting practice due to the dynamic and complex nature of this sector. From inventory management (unusual settlement of production costs against inventory, calculation of finished goods), settlement of costs of servicing and repairs, to trading in vehicles – each of those aspects requires a precise and dedicated financial analysis.
Very often, it requires from the accountant deep knowledge in the scope of detailed settlements of taxes such as VAT, excise tax (in case of import of cars, purchasing fuels used in the production process), income tax (this industry often utilizes tax exemptions and B+R reliefs) and the ability to settle governmental subsidies.
Choosing the accounting firm for an automotive company
Choosing the correct accounting firm is crucial for ensuring an effective cooperation. One should seek for a firm with experience in the automotive industry, offering comprehensive accounting services, including support in tax consultancy and optimization of operating costs.
An independent accountant at an automotive company must perfectly understand regulations which are specific for the industry; they must be up to date with legal changes and effectively manage the company’s financial documentation, which is of key importance for its proper functioning. This sector often utilizes relevant tax reliefs and exemptions that can contribute to reducing the burden of an automotive company.
Financial management in the automotive industry
Financial management does not only include the ongoing accounting but also strategic financial planning, forecasts of future expenses and investments in new technologies and solutions that may increase the company’s profitability. In the case of this industry, costs serve a specific role.
An effective cost analysis at an automotive company requires segmentation of costs by individual departments and projects, analyses of margins on vehicles, as well as monitoring of the operational effectiveness of servicing facilities and sales departments.
Financial management in an automotive company: best practices
The best practices in financial management in the automotive industry involve continuous improvements of the accounting processes, the use of advanced tools for data analyses, as well as application of financial risk management methods.
Financial reporting constitutes an indispensable element of the proper assessment and monitoring of the financial condition of an automotive company. Financial reports in the automotive industry should be interpreted with regard to the seasonal character of sales, market trends and changes in legal regulations that might affect the company’s financial performance.
Accounting for various sectors of the automotive industry
Accounting for the automotive industry varies depending on the sector – production, sales, servicing of vehicles or fleet management require different strategies and specialist knowledge.
Accounting for a repair shop.
Repair shops must be particularly focused on managing costs of repairs and parts, as well as optimizing the purchase and storage processes in order to remain profitable.
Car repair services: financial aspects
The finances within the scope of vehicle repairs are concentrated on a precise settlement of costs of labor and spare parts, which is of key importance to maintain competitiveness in scope of prices and quality of services.
Sales of vehicles: financial and accounting aspects
Sales of cars requires scrupulous bookkeeping in the scope of revenue, costs and margins, both in the case of new and used vehicles, as well as a strict compliance with VAT regulations.
Modern solutions in automotive accounting
Thanks to advanced solutions, such as online accounting and automation of the accounting processes, automotive companies may manage their finances more effectively and accurately.
Online accounting offers quick access to financial data, a possibility of integration with other operating systems, as well as automation of many accounting processes, which greatly speeds up the work and reduces the risk of errors.
Automation of accounting processes in an automotive company
Automation of accounting helps reduce the time needed for routine tasks. It also increases data accuracy and allows better financial management in the dynamically changing automotive industry.
Well-managed accounting in the automotive industry requires specialist knowledge and adjusting to the characteristics of the sector. Choosing the right accounting firm that knows the specific challenges of the industry is very important for the sake of effective financial management and supporting the company’s development. Advanced tools and technologies can greatly facilitate the accounting processes which will translate to better financial and operational performance of the company.
Our offer for companies in the automotive industry
At our accounting firm, we perfectly understand the specific nature and expectations of medium-sized companies, both in the production as well as the service sector. Thanks to the long-term experience and orientation at the needs of the automotive industry, we offer many services adjusted to the challenges of the modern market.
Accounting services for the automotive industry are provided both through our MDDP Outsourcing system as well as the systems used by the customer. As a result, we ensure the most effective approach to financial management, which will be fully adjusted to the individual needs and objectives of every company.
We also handle professional reporting to shareholders, partners and investors. Our financial reports are clear, in line with the applicable standards and adapted to the specific nature of the automotive sector to allow a more efficient business management.
We provide comprehensive services within the scope of HR and payroll administration. We support automotive companies in management of employment, from recruitment processes, payroll settlement, to handling of related legal obligations.
Our accounting firm offers access to advanced information systems that facilitate the circulation of documents and management of employee documentation. The said systems are scalable and can be easily parametrized, which allows making effective adjustments to the growing needs of the company.
Thanks to the rich experience and specialty in the automotive industry, our accounting firm is able to offer the highest-quality accounting services that will help in efficient financial management and company growth. Our approach is always tailor-made to match the customer’s needs while our team of experts is available to provide support at each stage of the cooperation. We encourage you to contact us in order to learn more about the ways in which we can help develop your company.
