Pub. 60 2019-2020 Issue 4

17 SUMMER 2020 be completed and resolved (e.g., earned return reserve and ARP returns not yet done, such as TIM returns). • For special order parts, consider requiring upfront deposits or payments on special order parts needed to perform service work. 6. Warranty Reimbursement Increases Make sure you have submitted proper documentation to the manufacturer to get retail rates on parts and service warranty work, if applicable in your state. 7. Expenses • Manage supplier credit terms. Do not pay early if there is not a financial incentive. • Secure supplier rebates if available. • Make sure there are preferred vendors and back-up vendors for major expense categories. Consider negotia- tions where appropriate. • Extend payment terms or ask for discounts from sup- pliers and vendors. • Have all managers perform an expense line item analysis. • Consider an overtime or hiring freeze. 8. Tax • Evaluate the estimated tax status with your trusted advisor. The first two quarters of 2020 may result in very low, or perhaps no, profitability. You may be able to hold on to some cash you otherwise thought you might have to pay to the taxing authorities. • Visit the DHG COVID-19 web page for updates to tax law changes to take advantage of the government stimulus opportunities. • Re-evaluate the amount of distributions being taken out of the dealership. 9. Reinsurance • Consider the opportunity to take a loan, advance or distri- bution from one or more of your reinsurance companies. • Consider taking an advance payment on any available retro-arrangements. 10. Capital Expenditures and Special Projects Consider halting, or at a minimum have management re- evaluate, all significant capital expenditures and special projects. 11. Digital Solutions Evaluate the effectiveness of your advertising dollar spend and your digital presence. For more information, visit https://www.dhg.com/article/adapting-your-dealership- marketing-strategy-during-times-of-uncertainty. Conclusion In uncertain times, the low-hanging fruit or the basic block- ing and tackling can help locate cash quickly. Most of the points mentioned above should be items of continual focus but may easily be forgotten when business is going well. Paying attention to these items today is critical now as dealerships conduct business during the impact and effects of COVID-19.  For more information, visit dhgdealerships.com or contact the author listed below. DHG Contact: Thomas England , DHG Dealerships thomas.england@dhg.com DHGDealerships is one of the largest professional service teams provid- ing assurance, tax and advisory services to dealers across the country. We collaborate with key industry stakeholders to enhance the insights we bring to our clients and provide them access to valuable resources. Now more than ever, billers and finance and insurance (F&I) producers need to work extra closely in getting the appropriate documents in order to get the deals funded. The importance should be placed on getting the deals booked and funded as quickly as possible. E-contracting and e-signing should be considered during this discussion, especially in light of potential remote purchases and deliveries.